At a recent Chango board meeting, we were discussing recent hires (Dax Hamman as Chief Revenue Officer and Chris Dingle as COO) and the launch of the highly complex advertising platform. One board member pointed out that “NASA accomplished many great inventions and successful achievements on the way to the Moon…do we need to accomplish everything for the platform launch?” The immediate response from CEO Chris Sukornyk was, “Dude, the rocket ship’s packed.”
Well now it’s fueled too.
Today our Toronto-based portfolio company Chango announced it has raised a $4.25M Series B financing. The investment was led by Rho Canada, a division of NY-based Rho Capital Partners, and included participation from previous investors Metamorphic Ventures, iNovia Capital, Extreme Venture Partners and 24/7 Media co-founder, Geoff Judge. Our colleague from Rho, Roger Chabra, will join the board of directors.
Search Retargeting is a very interesting solution to a very large pain point in advertising. When people conduct a search, it provides an extremely relevant place to run texts ads. There is an extremely high demand for these search driven text ads, driving the price extremely (prohibitively) high for many search terms. Conversely, display ads are not nearly as relevant by themselves, have virtually endless inventory and much lower demand, driving the price extremely low. Chango’s platform targets display ads based on searches, taking the best part of advertising on search and expanding it to display.
How does it work? When a user conducts a search on Google, Yahoo! or Bing and clicks through on a natural or paid search result, the site they visit captures the referrer data which includes the keywords of the search. Chango aggregates this search data in large volume (now more search queries than Yahoo! or Bing) and each action of referrer data is matched to an anonymous cookie. This allows the platform to retarget advertisements based on any search action. The model greatly increases the ability of advertisers to reach their target customers they were unable to reach on the search engines.
Performance has proven itself, solving the pain on both sides of the equation. Publishers are seeing much higher yield for their less relevant display inventory while advertisers are finding new customers and achieving a significant return on investment. We are very excited about the trajectory for both Search Retargeting and Chango.
