TellApart Raises $13 Million to Help Online Retailers Nab Waffling Customers

Burlingame, Calif.-based TellApart has raised $13 million in a second round of funding to support something it calls “transactional retargeting.”

In practice that looks a little like this: Someone browses online for a particular product — perhaps a bike trailer. Later, when they are on a separate site, they see the same trailer being advertised in an ad. [See photo below.]

The second round of funding was led by Bain Capital Ventures. To date, TellApart has raised $17.75 million.

The company was founded in 2009 by former Google product and engineering executives Josh McFarland and Mark Ayzenshtat.

Other investors include Greylock Partners and several well-known angels, including Ron Conway, Twitter CEO Dick Costolo, LinkedIn’s founder Reid Hoffman and OpenTable’s former CEO Jeff Jordan.

The new financing will go toward supporting additional customers.

The company says it has the ability to “tell apart” the best customers from the rest. By identifying the most likely customers to target, it says it can generate an average 7.5 percent user click-through rate and an average 4.5 percent conversion rate from the ads it places on other sites.

By retargeting, TellApart claims its clients end up seeing an average of three to five percent lift in revenue.

TellApart only charges for its platform when a prospective customer clicks on a TellApart ad and makes a purchase.

Customers include, eBags, and Hayneedle.

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Just as the atom bomb was the weapon that was supposed to render war obsolete, the Internet seems like capitalism’s ultimate feat of self-destructive genius, an economic doomsday device rendering it impossible for anyone to ever make a profit off anything again. It’s especially hopeless for those whose work is easily digitized and accessed free of charge.

— Author Tim Kreider on not getting paid for one’s work