Imagine playing a crossword puzzle on the LA Times and once you've completed it, you get an ad that says: "Congratulations! You just completed the game. Brought to you by Coke." That's exactly the type of ads you're starting to see from Appsavvy clients. And, it's just got some fresh cash to build out this ad-per-activity platform.
NY-based Appsavvy announced late Monday that it's raised $7.1 million in a Series A-1 round of funding from existing investors, such as True Ventures, NY Times, and angels - Howard Lindzon, who is also the founder of StockTwits (and who will be speaking at our upcoming Vator Splash SF event this Feb 2) - Scott Kurnitt, the founder of About.com. Joining existing investors for this round is AOL Ventures. This round follows a $3.1 million Series A round raised in 2008.
The new funds will go toward building out Appsavvy's new model, which is to build a tech platform that targets activities on the Web. Those activities range from likes, comments, playing games and crosswords, to whatever activity a user is engaging in.
Sounds like an interesting and unique approach. But the question is: How much activity is going on out there? Not surprisingly, most activity occurs on gaming sites today. To that end, gaming companies make up the bulk of the customer base and inventory for Appsavvy, said Chris Cunningham, CEO and founder of Appsavvy, in an interview.
A rough estimate of how much activity happens across publisher sites is around 20% of the impressions a publisher generates a month, said Cunningham.
Appsavvy charges its partners - publishers and gaming companies - on a CPM (cost per thousand impression) basis. But unlike other ad networks that charge per impression, an impression on Appsavvy is actually any time a person "engages." So, in the example above, if I stumble upon the LA Times crossword puzzle, I won't see an Appsavvy ad. But if I engage with the puzzle, I might.
Because the ads don't appear unless a reader or game player engages, and because the ads are more personalized to that activity, CPMs are lower, but they also cost more than a typical CPM. They range between $10 on the Web, and $20 to $25 on mobile devices. Appsavvy also has technology that runs ads on activity on mobile devices.
Appsavvy currently has 70 clients since launching this new service in May, said Chris. Prior to May, Appsavvy was focused on a very different model. Since starting in 2007, Appsavvy had been focused on being more of a service-oriented company.