Peter Kafka

Recent Posts by Peter Kafka

A Sheriff for Web Ads Gets $10 Million

Web advertising is a big business, but it’s a young and rowdy one, too. Does it need a sheriff?

That’s the job DoubleVerify wants. And the start-up just raised more money to help it get the gig. Institutional Venture Partners led a $10 million B round for the company, with earlier investors Blumberg Capital, First Round Capital and Genacast Ventures all reupping after a $3.5 million A round last May.

DoubleVerify’s basic pitch is directed at advertisers: It promises to make sure they are getting the media buys they paid for. The company says it can confirm, for instance, that a marketer that only wants to reach a U.S. audience on Yahoo (YHOO) doesn’t have its ads displayed to visitors in France–or that an ad network isn’t running invisible ads no one can see. It also promises to maintain “brand safety” for advertisers–to keep, say, a Jet Blue ad from running next to a story about the underwear bomber.

This stuff sounds small-time, but it’s a big enough concern for advertisers–and publishers that want to court them–to turn into a real business for DoubleVerify and a host of competitors.

DoubleVerify won’t disclose revenue, but says that since November, it has been generating enough to cover costs for a 45-person staff. My back-of-the-envelope math translates that into something like a $5 million run rate. (CEO Oren Netzer says I’m way low. Think “several multiples” of that, he says.)

The problem for DoubleVerify is the same one facing all start-ups that want to carve off a piece of the online ad market: There are a lot of start-ups that want to carve off a piece of the online ad market.

In DoubleVerify’s case, it is either getting paid directly by advertisers, in which case its fee gets tacked on to the ad buyer’s media spend, or by an advertising network, in which case its fee comes out of the ad buyer’s media spend. Either way, it is taking another slice of a piece that is already getting sliced quite thin.

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Another gadget you don’t really need. Will not work once you get it home. New model out in 4 weeks. Battery life is too short to be of any use.

— From the fact sheet for a fake product entitled Useless Plasticbox 1.2 (an actual empty plastic box) placed in L.A.-area Best Buy stores by an artist called Plastic Jesus