Peter Kafka

Recent Posts by Peter Kafka

App Advertisers TapCommerce Raise $10 Million

iphone_appsIPad and iPhone users have downloaded 60 billion apps. Android users have downloaded 50 billion.

But just because a bunch of people have downloaded your app doesn’t mean they’re going to use your app.

Hence a new ad market that has appeared in the past year: App “engagement” ads, designed to get mobile users to re-open apps they’ve already got on their gadgets.

Facebook, which already makes a lot of money selling app install ads, started rolling out engagement ads last month. Now TapCommerce, a startup that only sells app engagement ads, has raised a $10.5 million Series A round, led by Bain Capital Ventures and RRE Ventures. Earlier investors Metamorphic Ventures, Eniac Ventures and Nextview Ventures, which had previously put more than $1 million into the company, are back as well.

App retargeting/reengagement ads have the most obvious payoff for app makers who sell stuff, and TapCommerce lists retailers like Fab, eBay and Jackthreads among its customers. CEO Brian Long said his company places ads on phones and tablets using nine mobile ad exchanges.

The open question for app advertisers is whether the market is a permanent one, or something that will deflate as app publishers get a better handle on what their apps are really worth.

The other question for TapCommerce is how it’s going to play with Facebook, which has found app advertising to be a surprisingly fruitful revenue stream. It will be interesting to see if they want to let outsiders play along.

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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