URL shortening service Bit.ly raises $10M

The Series B round is led by RRE Ventures, AOL Ventures, and others

URL shortening service Bit.ly announced late Thursday that it raised $10 million in a Series B round led by RRE Ventures, with participation from new-comer AOL  Ventures and previous investors O’Reilly Alpha Tech Ventures, SV Angel, Founders Fund, Mitch Kapor, and several other angels.

Founded in 2008, Bit.ly raised $5 million in financing between the time of its launch and 2010, bringing its total funds raised to $15 million. The New York, NY-based startup hit it big in May 2009 when it became the default link shortening service for Twitter.  Despite Twitter’s breakup with Bit.ly in December 2009 to use its own URL shortener, Bit.ly has continued to grow.  To date, the company has shortened four billion unique URLS, and in this year alone, Bit.ly links have been clicked on 40.6 billion times.  Over 200 million shortened Bit.ly links are clicked on every day.  These days, Twitter only accounts for one-third of Bit.ly’s links, down from 60% in December 2009.  In September of this year, six billion Bit.ly links were clicked on, up from 3.4 billion in March.

“Bit.ly sits at the confluence of three broad market trends: the growth of content sharing via social services, the growth of mobile, and the emergence of ‘the web of things,’” said Bit.ly CEO John Borthwick in the company’s blog.  “As these trends move though the market, short links are the addresses that connect people, things and machines.”

The bit.ly web site is now the 69th largest according to Google’s Doubleclick adplanner. Additionally, the company is working with over 3,000 large clients, as well as several small companies and individuals.  Some of the company’s larger customers include Amazon (amzn.to), Microsoft (on-msn.com), Yahoo (Yhoo.it), The New York Times (nyti.ms), Pepsi (pep.si), Foursquare (4sq.com), Formspring (4ms.me), CNN (on.CNN.com), ESPN (es.pn), BBC (bbc.in), and NPR (n.pr).  You have to admit, some of these are really cute… I think my favorite is nyti.ms.  That’s adorable.

Impressively, Bit.ly links now represent 7% of all of the URLs on the Internet.  “The short link business has now become an established piece of the social real time web infrastructure,” wrote Borthwick. “The entry of Google and others into this business affirms the importance of the category. At bit.ly, we believe that in a few years every link will have a short equivalent — so our job at bit.ly is clear.”

While bit.ly’s pro accounts comprise its primary source of revenue, it is currently working with The New York Times on a personalized news aggregator called News.me, which will be a traditional advertising-based model.  

Image source: bit.ly