eXelate Secures $15M; Educates Consumers On Ad Targeting

Mark Zagorski

Despite online privacy and tracking concerns, venture capitalists have not stopped investing in companies targeting consumers with ads based on behavior. eXelate announced Tuesday a $15 million Series B round led by Menlo Ventures, and includes previous investor Israeli-based Carmel Ventures, which led the company's $4 million Series A round.

While funding allows eXelate to continue support for agencies and develop its data management tool teXi:DM, which enables publishers to manage targeting data, the company plans to step up efforts to educate consumers about targeted ads, how their data is used, who uses it, and explain the benefits that enhanced online advertising can deliver, says Mark Zagorski, eXelate's chief revenue officer.

"In all of the debate about data privacy, one thing that's been forgotten is that there is so much free content available and that someone has to pay for it," Zagorski says." Subscription revenue isn't the answer for everyone, and I think we have all tired of the irrelevancy, annoyance, and oversaturation of untargeted ads -- 'punch the monkey,' anyone?"

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But consumers aren't the only ones in need of an education. The Wall Street Journal published a series of articles last week detailing what the publisher calls one of the "fastest-growing businesses on the Internet, "the businesses of "spying on American consumers."

The articles that detail tracking technologies that companies install and the privacy policies that guide their use sit on the WSJ's public site. One article notes that Microsoft developed the Web browser Internet Explorer with block tracking technology.

While the WSJ tried to educate the public, it missed the point that legitimate companies don't collect data with the malicious intent of exploiting consumers.

Consumer education remains one part of eXelate's plan for the funding. Similar to other companies, Zagorski says eXelate wants to develop tools enabling publishers and developers to monetize content more efficiently, so they can thrive in the new media ecosystem, yet provide centralized privacy control and data transparency for consumers.

Menlo Ventures Partner Mark Siegel will join Carmel Ventures General Partner and Co-Founder Shlomo Dovrat on eXelate's board of directors. The board recently expanded to include New York Times SVP of Digital Operations Martin Nisenholtz and IPG's Mediabrands Ventures CEO Matt Freeman.

Menlo Ventures also backs demand-side platform (DSP) DataXu, which provides a real-time bidding platform for online display advertisers. Earlier this week, the company launched Audience Optimization, allowing advertisers to reach custom audience segments, optimize campaign performance, and create advanced consumer insights.

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