TargetSpot Ups VC Funds To Improve Ad Technology

More news on the media venture capital front this week comes from TargetSpot, which announced Tuesday that is has closed a new, $8 million round of equity financing from Union Square Ventures, Bain Capital Ventures, CBS Radio, and Milestone Venture Partners.

TargetSpot said the funds will be used to improve its advertising technology, expand its network, and augment its national sales force. Technology investments will include developing new capabilities in targeting applications, analytics, and multiplatform consumer engagement.

TargetSpot claims to be the world's largest online audio advertising network, with members ranging from the Web operations of big broadcast radio groups to pure-play online radio companies; affiliates include CBS Radio (one of TargetSpot's initial investors), Emmis, Entercom, Tribune, Bonneville International Corp., Saga Communications, Reach Media, Oprah Winfrey's Harpo network, MySpace Music, Slacker.com, AOL Radio, Yahoo and Live365.

In October 2008, TargetSpot acquired Ronning Lipset Radio, retaining founders Eric Ronning and Andy Lipset as co-presidents of sales.

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Jeffrey Glass, a managing director at Bain Capital Ventures and TargetSpot board member, stated: "We have seen a rapid transition of online audio advertising into an essential component of the media buy for the largest national and regional brands."

There's no question that online audio ads are the fastest-growing part of the radio business, viewed from the perspective of traditional broadcast radio groups. In the first nine months of 2010, total digital revenues were up 22% to $443 million, according to the Radio Advertising Bureau -- far outpacing the radio business as a whole, which increased 6% to $12.7 billion. However, as these numbers indicate, online advertising remains a relatively small part of the overall business (3.5% of total revenues in the first three quarters).

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