Cortica Raises $6.4M To...

Cortica , a startup developing technology for analyzing in-image content, is announcing that it has raised $6.4 million in Series B funding. The round was led by previous investors Horizons Ventures (the firm which manages investments for Hong Kong business magnate Li Ka-shing), with participation from Russian firm Mail.ru Group and other angel investors. Cortica has now raised a total of $18 million. Founded by neuroscientists Yehoshua (Josh) Zeevi and Karina Odinaev, as well as engineer Igal Raichelgauz (the company’s CEO), Cortica says its Image2Text technology processes images based on patterns and identifies the images’ core concepts. It also says that it delivers zero false positives — in other words, it might not identify every concept associated with an image, but it will never incorrectly identify one of them. When I spoke to Cortica last year, it was focused on using the technology for in-image advertising — if you have an accurate sense of the content of an image, you can place ads that are a good match. Advertising is still one of the use cases, Raichelgauz said, as is e-commerce, but the biggest use among the company’s initial commercial partners is visual search. The technology is now deployed across hundreds of millions of images, he added. “The goal now is to distribute Cortica technology across multiple partners, whether those are leading publishers, leading manufacturers of devices, and so on,” Raichelgauz said.

Startup-PR Matchmaker A...

For pretty much as long as long as anyone can remember, a relationship triangle, or a “love triangle” if you will, has taken shape between companies and the PR firms that represent them and the press that covers them — existing in some sort of recursive loop. Yet, while that triangle should have come to represent a symbiosis and a valuable communication network, somewhere along the way the triangle broke down. (Defying the laws of Geometry, even.) In reality, today this relationship is more like the Bermuda Triangle . While the matter of who is responsible for the disconnect is subject to debate, the PR industry (for right or wrong) usually takes most of the blame. While the causes are numerous, in the end, most of the problems inherent to the startup-PR relationship are a matter of transparency (or lack therof) and the inability for either side to find the best (and most mutually beneficial) match on the other. AirPR launched into private beta last year with $1 million in seed funding from 500 Startups, Mohr Davidow Ventures, WordPress founder Matt Mullenweg and others to help solve this problem by creating a marketplace in which startups can find PR representation that’s right for them, and vice versa. Pitched as a kind of “Match.com for PR,” at launch AirPR focused primarily on matching top, pre-screened PR talent in the U.S. with technology startups looking for (and able to pay for) representation. Last week, after a year of testing the system in closed beta, iterating and tweaking, the San Francisco-based company has finally opened its marketplace to the public. With its public launch, AirPR is opening its doors to all tech startups, expanding its marketplace to include companies in the lifestyle and consumer goods verticals and adding a few tweaks to its formula. After watching 70 companies go through its PR matchmaking system and processing feedback from PR veterans, AirPR cut its onboarding process in half. Now, in order to find the best match, startups enter the date they want their PR campaign to begin and then answer a series of questions about their focus, stage of development, what kind of help they’d like, how much funding they’ve raised, and so on. AirPR then screens the startups and, if they meet its quality standards, uses the startup’s answers to match them with reps whose experience best fits that criteria. If not, they’re declined. After being alerted to the incoming business leads, reps then place bids for the client, at which point the startup can sift through the offers, compare them, select the best option and pay for a 60-day contract. Based on feedback from startups and PR pros, at launch, the platform also now includes a recommendation system, in which AirPR provides the top three matches based on the data its collected on the PR side. Initially, the company provided a list of all possible matches, but the co-founders tell us that companies were often overwhelmed by an abundance of choice and were less inclined to finish the process than if the system served provided three of its closest matches at the top. In turn, by recommending PR reps and being more proactive in pushing reps to reach out to specific companies, the conversion ended up being faster and a higher percentage of companies closed the deal. While there may be contention over the cause, most will likely agree that the PR model as it currently stands is in sore need of improvement. As someone who stands at one of the corners of the PR Bermuda Triangle, I can attest to this. PR reps have a tough job, and, as in any interest there are incredibly talented, bright firms and reps that get lumped in with the offenders who blanket journalists inbox with copy-and-pasted pablum and poorly worded pitches that aren’t even relevant to a writer’s beat. Any improvement on the overall quality of the PR-startup relationship stands to benefit everyone involved, and while it’s still early to say just how effective AirPR’s model will be, it’s worth the effort. While the startup’s matching algorithm and marketplace model are familiar, what may be even more valuable to the Bermuda Triangle (and to the industry at large) is the insight that can be pulled from the data AirPR collects on how startups are using the system, what they want help with, how effective PR is at meeting its goals, costs, publications they want to speak to, among other things. This data can help both startups and PR people be more effective and precise with their pitches and outreach. (One can also, much to the delight of everyone except PR, imagine AirPR eventually using this data to make a list of the “Top 10 Most Effective PR Firms,” for example.) AirPR allowed TechCrunch an early look into some of the data (and insights) it’s collected thus far, and the conclusions are telling. For starters, the most popular keyword or service startups were looking for help with was “Growth,” with 84 percent of companies listing that as top priority, followed by 69 percent of companies looking for “Brand Awareness,” 36 percent for “Launch,” 25 percent for “Fundraising,” and 16 percent for “Recruiting.” Next, another one that will be of interest to PR reps: The company found that fixed bids (a bid with one amount, like $20K for a 4-month project, for example) were 29 percent more likely to close than retainers (monthly bids). In explaining just why in the sam hill we should care, AirPR CEO Sharam Fouladgar-Mercer explains that, historically, the PR industry has primarily operated on a retainer model. However, the monthly averages for both fixed bids and retainers are almost the same, he says, so the data thus far seems to show that the reliance on the retainer model is psychological, rather than what its customers want. Clients seem to appreciate the one-time fee with specific deliverables, the CEO explained — a conclusion that helps startups and PR move closer to transparency rather than clients being forced to ask “what exactly are we paying for?” each month. To date, AirPR has found that the average bid accepted on the platform breaks down to roughly $5K/month in fees (whether fixed or retainer) for an average of 5 months. In other words, companies that have between $500K and $4 million in funding want shorter-term contracts with lower rates. This, in and of itself may not be surprising, but the more data it collects, the more it will be able to reveal correlations between not only funding and how much they’re willing to pay, but size of bids and the work they want done, the industry they’re in, and so on. The CEO also tells us that several of the PR reps on the AirPR platform have doubled their business since joining and are “now looking to grow their practice with other folks on the platform, like a co-op situation,” he says. To this point, the idea from the beginning has been to not only help startups who often have no idea where to start when looking for PR, but to serve PR firms and reps that are looking to expand their practices. In the end, the AirPR co-founder tells us, this helps them weed out lower quality PR and put the best firms and people in control. If AirPR can follow through on that idea, its marketplace could end up providing a lot of value to both startups and the PR firms that love them by helping them navigate the Bermuda Triangle and get more bang for their buck.

Ad Giant WPP Takes Stak...

WPP, the advertising giant, is taking another step into the world of startup investments, this time specifically in mobile and social media. It is taking a stake in Muzy , a Pinterest-style social media platform that lets users incorporate links to images, games, text and more, which they then share with their friends, or with the world at large. The site has some 20 million users and is adding 1 million each month. Terms of the investment were not disclosed but we are trying to find out. That growth, however, and the facts that Muzy is social and mobile, are three indications of why WPP took an interest in the site. Muzy, founded in 2011 and based in San Francisco, was founded by Andrew Chen (CEO) and Matt Rubens (CTO). Chen had also held positions at Mohr Davidow Ventures and Revenue Science, while Rubens, an engineer, has worked at Amazon.com, among other places. According to a release , the company will be using the funding to staff up — it currently employs less than 10 people — and “build out the suite of creative publishing tools for the Muzy platform.” At the moment, when you go to the site, you can choose from some 50 widgets to publish content into your page. It’s this app-within-app facility that sets Muzy apart from other platforms focused on content creation and self-expression, and could be one way for the company to differentiate longer term. It could also be a way for WPP to potentially look at ways of monetizing. You can imagine, for example, widgets or channels getting sponsored by brands, not to mention pages themselves. In an age where users are getting increasingly desensitized to display advertising online, you can see how new formats like these will continue to be tested out as ways of getting users to engage with marketing (as a way, also, of financing sites like these). WPP has developed something of a track record in making strategic investments into digital, specifically mobile and other emerging areas, as a way of shoring up against larger trends in the industry away from more traditional forms of media like print. Following where the consumer masses (and their eyeballs) are going, WPP has taken stakes in e-commerce sites like MySupermarket ( $10 million in April 2012); and more straight media plays, such as yesterday’s news, a stake in Fullscreen ( undisclosed amount ). Perhaps the biggest of these for a long time will be the company’s acquisition of digital agency AKQA (June 2012, reportedly at a $550 million valuation ). It’s the AKQA deal that has provided the engine to today’s news around Muzy. The investment is being led by WPP Ventures, a Silicon Valley-based operation for WPP’s bigger investment efforts. WPP Ventures is being led by president Tom Bedecarré, who is also chairman of AKQA. WPP, one of the world’s very biggest ad agencies, says that in 2012 its digital revenues were over $5 billion, some 33% of its total revenues of $16.5 billion. It’s long been pursuing a target of getting 40% of its revenues coming from digital by 2018.

¿Cómo Ha Crecido Path? ...

The mystery of Path’s mysterious growth deepens. The app, which has been around for nearly three years, miraculously jumped up the charts from between 500th and 600th place to the teens on the free list about two months ago. That raised questions about how the app was able to do that so spontaneously. Was it that Path finally suddenly acquired the network effects and organic growth that it had worked for years to trigger? Or was it something else? Valleywag speculated that it was spamming tactics plus spending on advertising , citing a graph from app and mobile ad tracking service Onavo Insights. The chart showed that an uptick in advertising spending that coincided with Path’s gradual rise up the overall charts. In fact, a source familiar with the spending habits of various top-tier mobile developers tells me that Path was the third highest spender on iOS app install ads on Facebook in the month of April behind the usual suspects like the top-grossing gaming companies. It then tapered its marketing spend down in May, and it also suffered slightly on the charts after Facebook shut down the app’s “Find Friends” ability. Path’s Facebook ad spending was also done in a clever way, with much of that spend being devoted to Spanish-language ads instead of English ones. We have an example unit at the top of the story, which appeared in the Facebook mobile feed and which Path put money behind earlier this spring. Not only that, if you dive into Onavo’s data, you’ll see that the highest correlating apps for Path usage in the U.S. are Mi Banco Mobile and El Nuevo Dia. Morin has talked about this publicly before, telling The Wall Street Journal that the company saw a spike in adoption in countries like Venezuela, Mexico and Puerto Rico. Path, for its part, is issuing its clearest statement today on its spending habits. It says it spends nowhere near what Valleywag claimed, which is more than $10 million in marketing over the last two months. “We would like to set the record straight once and for all — Path’s recent growth has been primarily organic and viral,” said the company’s vice president of marketing Nate Johnson. “While we do run Facebook ads in growing markets around the world, that spend averages in the low 10′s of thousands of dollars a month at best. Recent claims that Path has spent an order of magnitude more than that are laughable.” There are a couple ways that you can look at this. If you took a more cynical point of view, you could argue that this is a way for Path to grow without industry observers and potential investors seeing that the company is doing potentially unsustainable user acquisition. If you took a more benign point of view, you could say that the messaging market already has leading contenders in Europe, North America, China, Japan and South Korea through companies like WhatsApp, KakaoTalk, WeChat, Facebook Messenger and Line. While WhatsApp does have a lead in Latin America and other Spanish-speaking markets, perhaps this could be a savvy way for Path to lock down one of the last regional markets that’s vulnerable to a newcomer. To be fair, I also think that Valleywag’s headline about Path “cheating” its way to the top of the charts is overblown. Spending money to advertise your product is not a sin. The majority of companies at the very top of the grossing lists do this every day. It’s a form of arbitrage: spend X amount of money to bring in a user, and earn Y from them over their lifetime of playing a game, buying Groupons or stickers or whatever else. Mobile gaming companies like Supercell and Kabam have dedicated “user acquisition” teams that can spend millions of dollars per month on this type of marketing. If Path is presumably earning enough revenue from sticker sales to justify this spending, it’s not really a problem. But spending money on marketing in an ROI negative way is problematic if you intend to build a sustainable business — which could be an issue if the company moves forward with early-stage fundraising talks that could value it in the high hundreds of millions or even a billion dollars .

Google Shuts Down Mobil...

Google , the worldwide leader in mobile advertising, today made another move that could help consolidate its position a little bit further. The company today announced to developers that it would be shutting down AdWhirl , a platform that let app developers switch between different ad networks on the fly. AdWhirl was a part of AdMob, acquired by the mobile ad network after a flurry of competition , just months before AdMob was acquired itself by Google for $750 million. In a letter to developers sent out today (embedded below), Google said that they will until September 30 to decide where they would like to move their ads. It’s encouraging them to migrate to AdMob Mediation, a competing tool that it launched after the acquisition while continuing to support AdWhirl. They can also continue to use AdWhirl, if they care to use the open source code “to run their own AdWhirl service.” But Google won’t be involved with hosting or supporting it. Predictably, some developers are not happy with the decision because they believe the timeline is too short. “We developers understand that it might be discontinued in the future, but terminating this in three months is just too fast for us to migrate,” writes the developer who forwarded us the letter. “A lot of developers depended on most of their revenue through this product.” Others are commenting on Google’s forums. “Some of us have used AdWhirl for 4 years and have tons of apps to update for this change,” one wrote. “When you killed off Google Ads and forced us to use AdMob at least you gave us till the end of the year. What about the users that don’t upgrade, will you continue serving them ads?” Eric Leichtenschlag, an engineer with AdMob, notes that AdWhirl.com will also be shut down, so users will not be able to log into their accounts after September 30. For those apps that don’t migrate from the service, mediation will stop working. “This means we will return a 404 to the SDK and there will be a blank space where the ad used to be.” It’s a whimper of an ending for a service that was once a thorn in the side of AdMob, since it was initially used as a way for competing networks like Quattro (now part of Apple) and Jumptap (still independent) to have more leverage against the most dominant player. Until that player took AdWhirl, and its revenues, for itself, users of the mediation platform could swap in ads on their apps on the fly from a number of networks (an unlimited number, AdWhirl says on its site), a model that forces more competition in pricing. But in the greater scheme of things, this shouldn’t really come as a surprise. As Google continues to earn more than half of all worldwide revenues in mobile ads (in 2013, eMarketer predicts Google will make nearly $9 billion out of global sales of nearly $16 billion), it has been making a number of efforts to streamline its mobile ad operations. That includes a rebuild of AdMob’s developer tools in May, and integrating AdMob and AdWords. And it points out that the newer system is actually better, because it covers more ad formats, better reporting (for AdMob, at least), and has better Google support built in (of course), among other things. A Google service is still a Google service, by any other name. The letter: Dear AdWhirl by AdMob Developer, AdWhirl has been supported by Google since 2010, when it became part of the Google family through the acquisition of AdMob. Since then, we’ve invested in helping AdMob developers serve ads in their apps from any number of ad networks through AdMob Mediation, which many developers use today. As we continue to improve AdMob Mediation, we’ve decided to retire AdWhirl, and will be discontinuing the service on 30 September 2013. The open source code for AdWhirl will still be available if anyone wants to run their own AdWhirl service. AdMob Mediation is at no cost and more robust, with features like network-level reporting, country-level allocation and support for more ad formats. You can learn more about the specific features of AdMob Mediation here. We encourage you to start using AdMob Mediation prior to 30 September. You’ll need an AdMob account to begin using AdMob Mediation. If you have one already you can find instructions for switching from AdWhirl here. If not, you can sign up for an AdMob account here. Sincerely, The Google AdMob Team