NEW YORK Online ad broker BlueLithium said it has closed an $11.5 million funding round led by WaldenVC and 3i.
BlueLithium said it would use the funds to expand in the United Kingdom and to improve its ad-targeting technology. The financing is BlueLithium's first venture capital infusion since it was founded 14 months ago.
The San Jose, Calif., company competes with ad brokers like Advertising.com and Fastclick. Ad brokers buy remnant ad inventory from publishers, then re-sell it to direct-response marketers while using optimization technology to target ads to customers likely to respond. BlueLithium said it reached 100 million Internet users through 1,000 network Web sites in December 2004. In November 2004, it bought ad-serving and optimization technology specialist AdRevolver.
"Online ad networks are already an important part of the online advertising ecosystem," said Rich LeFurgy, a partner at WaldenVC, who will join BlueLithium's board of directors. "It speaks to advertisers recognizing that networks play an important part to round out an online media plan."
BlueLithium founder and CEO Gurbaksh Chahal ran an early cost-per-click banner ad network, ClickAgents, which ValueClick bought in 2000. "Five years ago, our value proposition was reach and bulk traffic," Chahal said. "Nowadays it's evolved into who has the best technology and distribution."
The success of online ad networks spurred AOL to pay $435 million for Advertising.com last June. Fastclick has filed for an initial public offering that could net it $92 million. Claria, an adware company, said recently it plans to launch an ad-broker network in April that will buy up to $100 million of online ad space in a year.