{mosimage}Cambridge, MA, — JumpTap, the Cambridge, Mass. based leading provider of mobile search technology and advertising services for mobile operators such as AT&T and U.S. Cellular; today announced that it has closed a Series D round of funding in excess of $26 million. The company also provides advertising for carriers and content owners such as NBC Universal and Fox Mobile, the company said Tuesday.
The investment was led by AllianceBernstein L.P., one of the largest publicly traded global asset management firms in the world with approximately $694 billion in assets under management. Existing investors participated were General Catalyst Partners, Summerhill Venture Partners, Redpoint Ventures, Valhalla Partners, and WPP.JumpTap, which works with 17 mobile operators around the world, competes against search and advertising heavyweights such as Google, Yahoo, and Microsoft. The new funding, which completes the company’s fourth round of financing, brings its total cash raised to around $73 million.
JumpTap will need all the funds it can get. Mobile advertising is supposed to be a huge business in search as more and more Web-capable phones hit the market. Witness Google’s recent deal to power Verizon’s mobile search. Nevertheless, only 7 percent of mobile subscribers in the U.S. use search. Going up against Google, even in a nascent market, is a tough proposition. But Jumptap thinks it has an edge. CEO Dan Olschwang says:
JumpTap will use the money to continue developing its products, hire more sales staff, and expand internationally, specifically in Europe.
The cash infusion will help the company continue to develop its technology and expand its sales force to take on the bigger players.
“It is really a David and Goliath story,” said Paran Johar, chief marketing officer for the company. “And we are not Goliath. It takes a lot of investment to compete against Google, Yahoo, and Microsoft.”
But Johar believes that JumpTap is well-positioned to take on these big companies because it has not perceived as a threat by the mobile operators. The company has made significant inroads with operators around the world. It provides the technology and the operators are able to use the technology and integrate it as a “white label” solution into their own mobile platforms.
“Internet advertising is currently growing at a compound annual rate of 18.3% and will reach $73 billion in 2011. What is really exciting about mobile advertising is its ability to eclipse Internet advertising,” said Olschwang. “We have seen firsthand that mobile advertising is a viable mass medium — a fact which is reflected by our significant growth and numerous recently announced deals.” Olschwang also commented, “The closing of this round by these prestigious investors during a tight financial credit climate sends a strong and positive message about their confidence in the growth potential of mobile search and advertising and our ability to execute on our long-term vision. We are truly excited as to the value our new investor AllianceBernstein brings to the table.”
But even those predictions pan out; it would not be easy for JumpTap: Beyond other mobile ad upstarts, it will increasingly be competing for deals with the likes of Google, Microsoft, and Yahoo.
Sprint Nextel recently made Google the default browser on 40 of its phones, and AT&T plans to use Yahoo to power search on its Media Net portal beginning later this year. The major wireless operators have historically been reluctant to share ad revenue with the Web portals, choosing instead to work with smaller partners like JumpTap and Medio to supply search and other services.
AT&T, Verizon Wireless’ largest rival in the mobile market, is already working with JumpTap. But now JumpTap is deepening its relationship with AT&T, Johar says. Previously, JumpTap only powered the carrier’s on-deck search, but now it will be accessing AT&T customer information to help sell targeted advertising.
“Google may have a larger share of the overall search market,” he said. “But the game is just beginning in mobile, and we are just starting to unlock the data to provide better and more targeted search and advertising. So I feel very good about our position in the market.”
“JumpTap has successfully positioned itself as the hub of the mobile advertising ecosystem and demonstrated its ability to attain its goals,” said Mark Mackenzie, vice president and head of digital media venture capital investing at AllianceBernstein, in a statement.