YoY funding into companies that target ads based on past web behavior has risen 62% with YoY deal growth jumping 32%.
Providing tools to display ads based on previous online activity from search history to website visits, a number of venture-backed companies now occupy the ad tech space known broadly as retargeting. And retargeting has become big business: Google offers its own dedicated retargeting platform, Google Remarketing, and Twitter is now rumored to be prepping an ad retargeting exchange similar to Facebook Exchange. Given that retargeting covers a variety of different forms and functions, we divided the space into three sub-categories, as described below, along with sample companies for each.
Search Retargeting – Companies that leverage data on a consumer’s previous search habits to target ads. This includes companies like Chango and Simpli.fi.
Site/App Retargeting – Companies that target ads based on past website or app visits which are displayed as the consumer navigates other sites. Examples include AdRoll, Criteo and Tapad.
Social Retargeting – Companies that mine social data including social networks and blogging activity in order to target ads. This includes companies such as Perfect Audience and RadiumOne.
Over the last year, venture investors have placed nearly $217M into retargeting companies across 25 deals. The leap in YoY funding growth was spurred by several large fundings in Q2’12 and Q3’12 including Rocket Fuel’s $50M Series D round and a $39M Series D round by Criteo, a tech IPO pipeline company.
Close to 30% of deal activity in retargeting in the past two years went to mid-stage financings at the Series B stage. While Seed/Angel rounds only captured close to 14% of all deals, YoY deal growth has advanced 300% with recent financings including Admazely and Y Combinator-backed Perfect Audience.
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California saw the highest amount of deal activity in the retargeting space with more than 38% of overall deals, followed by New York, which is known for its strong ad tech presence, at 19%. International markets also saw a number of venture-funded companies within the retargeting space such as MyThings and Struq, based in the UK, and France-based Criteo and Next Performance.