Online advertising gaining venture capitalists' interest

January 11, 2005

Online marketing and Internet advertising continue to attract substantial venture capital dollars.

Larry Marcus, general partner of venture capital firm WaldenVC, and a former Deutsche Bank analyst, said there is "massive" opportunity in the burgeoning ad market. "Internet advertising is now a $10 billion industry. That's an incredible thing for content providers," he said.

Mark Stevens, a partner at the law firm Fenwick & West, said he couldn't agree more with Marcus "about the power of the advertising model."

Visit marketing trends.org for the latest news in Internet marketing

News and trends in Marketing on the Internet

"It feels a little like it's 1998 again," Stevens said. Both Stevens and Marcus agreed that ad-supported media content providers once again have a compelling business model now that the ad market has matured and stabilized.

Stevens noted this success comes at the expense of older ad-driven media like newspapers--an industry that "doesn't even know its business model is dead," he said.

While online advertising currently is only projected to account for 3 percent of domestic ad spending, Marcus said he sees it surpassing both print and radio in the next several years, and then television and cable in the future.

Marcus said his firm, WaldenVC, is particularly interested in ad networks and resellers of inventory on a cost per acquisition basis. Toward the end of last year, investors starting showing their faith: at the end of summer, America Online bought Advertising.com for $435 million; in November, ad network FastClick secured $75 million in venture capital funding.

Marcus added that the firm also finds technologies that allow for contextual and behavioral targeting compelling, but privacy concerns have deterred investment. "Personally, I think privacy is a big issue," he said, emphasizing that the firm is not interested in software-based advertising companies because of this concern.

Moderator Joey Tamer, president of the consulting firm S.O.S., Inc., took note of the panelists' optimism. "We have all of you up here smiling, instead of just one of you, for the first time in three years," she said.

Leasing links to your website will boost your search engine visibility

But, despite the overall enthusiasm, some venture capitalists expressed caution.

Santo Politi, partner at Charles River Ventures, said that now is a good time to invest, "but not as good as two or three years ago," partly because advancements in technology have resulted in awkward growing pains for certain companies.

He pointed out that growth is occurring in esoteric technology sectors that already have a small number of available, qualified personnel, which makes it difficult for small companies to meet the demands of expansion efficiently.

Source: Mediapost

Read Serge Thibodeau's daily blogs on search engines at Serge Thibodeau Live. We strongly suggest you bookmark our web site by clicking here.

Tired of receiving unwanted spam in your in box? Get SpamArrest� and put a stop to all that SPAM. Click here and get rid of SPAM forever!

Get your business or company listed in the Global Business Listing directory and increase your business. It takes less then 24 hours to get a premium listing in the most powerful business search engine there is. Click here to find out all about it.

Rank for $ales strongly recommends the use of WordTracker to effectively identify all your right industry keywords. Accurate identification of the right keywords and key phrases used in your industry is the first basic step in any serious search engine optimization program. Click here to start your keyword and key phrase research.

Pay Rank for $ales securely with your Visa, MasterCard, Discover, or American Express credit card through the secure PayPal network. (Note: PayPal is an eBay company, and maintains a net free capital of US $ 50 Million).

You can link to the Rank for Sales web site as much as you like. Read our section on how your company can participate in our reciprocal link exchange program and increase your rankings in all the major search engines such as Google, AltaVista, Yahoo and all the others.

Powered by Sun Hosting Sponsored by Avantex Traffic stats by Site Clicks�

Site design by Mtl. Web D. Sponsored by Press Broadcast Sponsored by Blog Hosting.ca

Call Rank for Sales toll free from anywhere in the US or Canada: 1-800-631-3221
email: info@rankforsales.com