Peter Kafka

Recent Posts by Peter Kafka

Yieldbot Raises $5 Million More to Marry Search Buyers With Display Ads

magnifying glassWeb advertising is still primarily about search advertising, which is a problem for many people who don’t work at Google.

Jonathan Mendez thinks this is an opportunity: The CEO of Yieldbot pitches his startup as a way to connect search advertisers with Web publishers who sell display advertising.

Mendez isn’t the only one out there making claims — you could argue that Google’s AdSense does something similar — but at the very least he is getting traction with investors.

He has just raised a $5 million round led by RRE Ventures, which doubles his funding to date; Mendez said his company is now doing a “mid-seven figure” run rate, up from essentially zero in the last year.

Yieldbot’s big-picture pitch is straightforward: It promises to help traditional Web publishers, who are seeing their ad rates decline as more and more display inventory comes on board, by getting them better-performing ads. And it tells search advertisers that it can open up new pockets of inventory for them.

I know genuinely smart people who tell me they have a hard time following the technical parts of Mendez’s story. So I feel a little less bad about not understanding exactly how Yieldbot is supposed to work.

But in essence, Mendez said he can figure out what a Web surfer is trying to find, without seeing an actual search query, by tracking their behavior once they get to a Web site; he also said that unlike ad tech that relies on “retargeting,” his technology doesn’t use third-party cookies to track Web surfers’ behavior before they get to the site.

That claim may be particularly helpful as cookies come under increasing scrutiny.

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I think the NSA has a job to do and we need the NSA. But as (physicist) Robert Oppenheimer said, “When you see something that is technically sweet, you go ahead and do it and argue about what to do about it only after you’ve had your technical success. That is the way it was with the atomic bomb.”

— Phil Zimmerman, PGP inventor and Silent Circle co-founder, in an interview with Om Malik