5to1 Lets Publishers Regain Control Over Unsold Ad Inventory

5to1, a startup with a high-profile founding team that includes former Fox Interactive execs Jim Heckman and Ross Levinsohn, has raised $4.5 million
in seed funding to work on a solution that can turn remnant advertising
into premium advertising. The company’s breaking out of stealth mode
today at TechCrunch50 with a service that could rid both publishers and advertisers of the extremely ineffective ad campaigns that are basically only beneficial to the networks selling them.

The 5to1 system allows publishers to get in between the remnant
networks and the ad inventory to give them more control over what will
appear on the site, where and when. The company’s founder and CEO Jim
Heckman dubs it a “Match.com meets iTunes for advertising” because it
allows publishers to dynamically create ‘playlists’ of ad units of
sorts and easily run both proper ads and potentially placeable remnant
ads on variable places on their website(s).

Ultimately, the goal is to make it easier for content publishers to
increase the quality of – and with it, the revenue that comes from –
the ads that appear on unsold inventory without too much hassle. And if
it takes off we’ll see a lot less of these horrible screaming ads that
you’d never click on even if they held you at gunpoint.

Q – Paul Graham: Humans can only do worse than the best optimization, right?

A: Pages are dynamic. What we found is that a vast majority of ads are not contextual, and we can fix that.

DataXu Optimizes Ad Bidding, Buying Across Exchange Platforms In Real-Time

The DataXu platform values, bid manages and buys ads on an
impression-by-impression basis, across the major ad exchanges and based
on smart algorithms. The platform is said to be capable of processing
hundreds of thousands of “ad decisions” a second, each returned in
under 100 milliseconds, through automated, campaign-specific algorithms.

Expert panel Q&A:

Q – Marissa Mayer: On a technology level, it looks impressive. My questions is: are you targetting people?

Ad buyers can build their own data profiles, so you can tweak it to
fit your core audience. The Internet is becoming more dynamic, and what
we’re doing fundamentally is make decisions quickly, change campaigns
in real-time and learn from past behavior.

Q – Paul Graham: What’s the rocket science behind it, the core engine?

A: Our system is designed to find the features that matters for
brand, really custom. Advertising is not a one-size-fits-all, you need
dynamic, intelligent algorithms.

Q – Tony Hsieh: We’ve dealt with third-party pixels at Zappos, and it causes problems. How do you deal with that?

A: As soon as we can tie data together, we can work, so it doesn’t have to be pixel ads.

Q – Marc Andreessen: What’s your sales model?

A: we can paid on a CPM basis, like an ad server, but a percentage on the lift.

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The Internet Is Killing Itself Softly With Remnant Ads

Ross Levinhson: AT Fox Sports, 70% of the inventory
was sold. If we sold out all the remaining inventory, I think in 2003,
it meant only $250,000 in revenues. We made a determination that a
quarter of a million dollars at that time wasn’t worth the hassle of
policing it.

On MySpace, we had to create scarcity where there was no scarcity.
So we had the homepage, ad networks were arbitraging. Tom shut that
down, no more ad networks on that inventory. If you have a site like
Hi5 or MySpace or Facebook, creating billions of impressions a month,
you have to find a way to create some scarce inventory so you can talk
to the Best Buys. They don’t want to be next to [remnant ads]

In many ways I think the Internet has killed itself to a degree
because there was a notion that I will just add another page without
maximizing the premium spots.

Video

The Value of TechCrunch50: Mint Acquired by Intuit for $170m Two Years After Winning TC40

Our technology was all open source, and essentially all free: MySQL
at the bottom, Hibernate to avoid the need to hire a DBA, Tomcat on
Apache, Yahoo’s YUI served as the base for our AJAXy goodness.

We didn’t have money for a lawyer, but no fewer than three offered
to help us incorporate and accrue $25k in legal fees for a little bit
of the company. We shared office space in a type of incubator, renting
by the cube to avoid a long-term lease.

We didn’t have money for advertising, so we started a blog. We
didn’t have money for writers, so most of our original blog content
then was guest posts from other personal finance blogs, plus a couple
of columns on people’s worst financial disasters.

To build demand, we started asking for email addresses for our alpha
9 months in advance of launch. Then when we had too many people sign
up, we asked people to put a little badge that said “I want Mint” on
their blogs to get priority access. We got free advertising and 600
link backs which raised our SEO juice.

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Mobile data show friend networks

Friendships can be inferred with 95% accuracy from call records and the proximity of users, says a new report.

Researchers fitted 94 mobiles in the US with logging software to gather data.

The
results also showed that those with friends near work were happier,
while those who called friends while at work were less satisfied.

The
data, published in Proceedings of the National Academy of Sciences,
showed a marked contrast with answers reported by the users themselves.

"We gave out a set of phones that were installed
with a piece of 'uber-spyware'," said the study's lead author Nathan
Eagle, now at the Santa Fe Institute.

"It's invisible to the
user but logs everything: communication, users' locations, people's
proximity by doing continuous Bluetooth scans."

The researchers
then compared the data with results from standard surveys given to the
mobile users - and found, as the social sciences have found time and
again, that people reported different behaviour than the mobile data
revealed.

"What we found was that people's responses were wildly inaccurate," Dr Eagle told BBC News.

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Brazil’s boo-box Aims to Customize Online Ads

Some $65 billion in advertising is expected to disappear from traditional media outlets in 2009, according to a recent report from Outsell Inc.,
a media research and advisory company. Companies will instead focus
their investments on their own web sites and other forms of online
marketing, where they can make a direct connection with consumers.
While for publishers, this is just the latest dark forecast, for boo-box, a Sao Paulo-based online ad startup looking to break into the North American market, it represents a possible point of entry.

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Kontera Raises $15.5M For Annoying In-Text Advertising Technology

In-text advertising technology provider Kontera has raised $15.5 million from its current investors Sequoia Capital, Carmel Ventures and Tenaya Capital, the former venture capital arm of Lehman Brothers. This is the second Israeli startup to announce multi-million VC rounds today after 5min informed the public about its $7.5 million Series B round, and once again first reported by business news site Globes.

Kontera provides publishers with real-time semantic analysis
technology that can enhance content and other information to
dynamically link terms that most accurately represent and predict
user-intent and engagement. This is known as in-text advertising,
and you might recognize the double-underlined words on some sites that
make display ads pop up when you hover your mouse over them. Other
market players include Vibrant Media and Infolinks.

Personally, I find this type of contextual advertising annoying from
a reader perspective, and I don’t think I’ve ever clicked on any ads
launched by in-text advertisements, unless it was by accident. But I
keep hearing from publishers and advertisers who have implemented
campaigns using in-text advertising that it’s actually a highly
effective way of pay-per-click promotion, and you wouldn’t be the first
to tell they were skeptical at first but lauding the technology
afterwards.

With the fresh injection, the total amount of capital pumped into the company has now reached $32.8 million. The $10.3 million Series B round now dates back nearly two years.

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