Luminate raises $10.7M to make images come alive

Nokia Growth Partners, August Capital, CMEA, Google Ventures, Shasta back image advertising service

Let's face it. We've gotten to the point where a static image online just feels old school. If you can't manipulate it, expand it, or dig a little deeper into the subject matter, it feels like we're not taking advantage of what the Internet can offer. 

That's changing as Luminate looks to chase after the three trillion images on the Web and make them come alive. Clearly, they're onto something as they continue to attract backers. 

Luminate announced Thursday that it's raised $10.7 million in a Series C round of funding, led by Nokia Growth Partners, and participation from existing investors August Capital, CMEA, Google Ventures and Shasta. The new round brings the total amount raised to $28 million.

At the same time, Luminate, whose mission is to transform images into rich interactive experiences, is unveiling its App Store for images, a central place where publishers can find, demo and deploy apps on their site.  

"We’re pioneering the notion of image apps [and now an Image app store]," said Bob Lisbonne, who's been CEO of Luminate since 2008, in an interview with me. Through the store, which currently has a total of 16 apps, publishers can find the latest applications that can make their images come alive. Five of those apps have been around since the company launched image apps last year, when it rebranded and changed its name from Pixazza. 

Among the 11 new apps include a Netflix app, which showcases movies or shows through Netflix, a Wikipedia app, which lets people see Wikipedia entries related to an image (see above image), a Twitter Feed app, which lets users view tweets about the person within the image, and a Causes app, which lets users donate to their worthy causes, such as American Red Cross. Down the road, the company hopes to open up its platform to third-party developers. 

For publishers, they can add a special line of java script to all of their pages and an app will be applied to images across their site. So far, Luminate has attracted 7,000 publishers (almost double since we last caught up with Luminate last July), including MSNBC, House Beautiful, and TV Guide, using its image apps. The images on those publisher sites see 150 million unique monthly users and 30 billion image views a year, according to Lisbonne.

So what's the point of using the image apps? There's some three trillion images online today, with 250 million new photos uploaded each day, said Lisbonne. "Images haven’t changed much," he added, suggesting that images could come alive if people could interact with them. 

"What our technology does is figures out what’s appropriate for each image," Lisbonne explained. "For a soccer photo, what’s relevant is stats about players... [our technology] figures out what’s interesting about an image and enables a consumer to access an image application that adds something to that image." 

The result of having an interactive app on an image is that people spend seven seconds more time per image. For apps that provide information, like Wikipedia, publishers pay nothing. It's only for apps that have advertisements where the publisher splits the ad revenue 50/50 with Luminate.

Many of the images don't have apps with advertisements on them, but for the apps with advertisements, the click-through-rates and CPMs (cost per thousands view) are much higher than static images, said Lisbonne. For instance, the CTRs are 5 to 10x higher than display CTRs, which are around .1%. "We commonly see 1% CTRs or higher," said Lisbonne.

"What advetisers like is that unlike many forms of display advertising which occupy parts of Web pages that consumers ignore, our advertisers get their message at a time when consumers are paying attention."

Current advertisers include McDonald's, Gap, Revlon and Best Buy, to name a few.