Peter Kafka

Recent Posts by Peter Kafka

Word-of-Mouth Ads, for a Fee: Dynamic Signal Raises $13 Million From Venrock, Time Warner

No one’s quite sure how social networks like Facebook will mesh with advertising.

But everyone is convinced they’re going to be important, which has meant good things for a bunch of companies that help brands manage their social presence — ask the guys writing checks at Salesforce and Oracle, for starters.

Here’s another: Dynamic Signal, which describes itself as a “social CRM” platform, has raised a $13.3 million B round led by Venrock. Time Warner’s venture arm is also getting into the deal, and previous funders, who put $8 million into the company, including Trinity Ventures and Cox Enterprises, have re-upped.

Plain-English definition of “social CRM”: Dynamic Signal offers a white-labeled community-management platform, which helps brands find and recruit online fans, and gives them tools that will let fans evangelize on behalf of their favorite products, across the Web.

Another way of thinking about it: Remember the brief vogue for “street teams,” which were supposed to push stuff for record labels and other youth-liking brands at the end of the late ’90s? This is a more formalized way of generating that “earned media,” available via a software-as-service model.

Adify CEO Russ Fradin says he’ll charge his largest customer north of $5 million next year, while his smallest will pay around $75,000.

Here, for instance, are some examples of stuff that fans of Oakley’s women sports clothes have been posting about their favorite bras, swimsuits, yoga pants, etc. Among other things, Dynamic Signal helps Oakley and other brands run fan sites that make it easy to share that stuff (note the button on the top right), and push it out to platforms like Facebook and Twitter and blogs; it will also help them track the impact all those shares have.

There are a bunch of companies that take on some of the stuff Dynamic Signal is doing here, but the company is still worth paying attention to, at the very least because of its leadership. Fradin and his co-founders are best known as the guys who built and sold ad network Adify to Cox for $300 million in 2008, and Fradin commands a lot of respect from ad tech folks.

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