Adly, a startup that connects advertisers with celebrities willing to post promoted messages on social networks, recently raised $2 million in additional funding.
The new funding came from previous backer GRP Partners and new investor Siemer Ventures. Adly has now raised a total of $7.5 million.
The company also launched a new product this week. It’s the first thing you’ll see if you go to the Adly website — a button that says “Match Me Up!” which allows Adly to analyze a business’ existing content and followers, then find publishers who are a good match to “amplify” their content.
For example, when I signed in with my personal Twitter account, Adly said it found six celebrity publishers who, collectively, could increase my reach 61x and my engagement 31x. They include a blogger/entrepreneur with 103,000 followers, an analyst with 180,000 followers, and a podcaster with 199,000 followers. (I also tried to analyze TechCrunch’s account, but we have too many followers.) Who are these people? Well, you don’t actually get to find out until you actually start a campaign with Adly.
Walter Delph, who became Adly’s CEO a little more than a year ago, said this is part of his larger strategy. One of Adly’s big selling points is the fact that advertisers aren’t just getting access to a lot of eyeballs. By enlisting celebrity endorsers, they’re hopefully prompting lots of conversation and engagement, i.e. reach that’s “earned” rather than paid for. The company’s next step is building more tools to ensure that the conversation and engagement is happening.
To that end, Adly has been adding analytics to track the results of each campaign — the full reach of the message, the replies, the shares and the clicks. That dashboard, however, is really about looking back at a campaign (though customers get the data in real time, so they could adjust their spending accordingly). On the other hand, Delph said the celebrity matching tool is all about looking forward — it’s a way to get people started with Adly campaigns. He added that we can expect more features to come that take advantage of the company’s “reams and reams of data.”
By the way, even though Adly is known as a celebrity endorsement network, it’s actually broader than that. The company has relationships with 75,000 influencers, and Delph estimated that only about 2,000 of them are celebrities in the traditional sense — “By celebrity, what I mean is, if you walked down the street you would recognize them.” The other 73,000 aren’t at that level, but they have influence that’s valuable to advertisers (at least when it comes to certain topics).
Pandora has had a busy quarter. In March, the social radio company saw its long-time CEO Joe Kennedy abruptly step down, leaving the board to scramble to find a replacement. On the bright side, Kennedy’s exit, while likely a result of stress, followed relatively good times for Pandora. And it’s continued to push forward since.
Pandora launched an ad-free version for Windows 8 in March, surpassed 200 million users (with over 140 million accessing Pandora via mobile) in April, then launched a “Premieres” station for U.S. users and deepened its Facebook integration with a new Timeline App.
Today, Pandora’s first quarter earnings reflected this flurry of activity, as the company saw GAAP total revenue increase 97 percent year-over-year to $83.9 million (with non-GAAP mobile revenue of $86.7 million), which outpaced mobile listener hour growth at 47 percent year over year. Meanwhile, total revenue came in at $125.5 million, representing 55 percent year-over-year growth and non-GAAP total revenue of $128.5 million.
What’s more, share of total U.S. Radio listening for Pandora grew to 7.33 percent in April — an increase from 5.86 percent in the same period last year.
This news followed a strong earnings report from Pandora for the fourth quarter as well, thanks chiefly to mobile revenue growth of 111 percent year-over-year (to $80.3 million), which caused the company’s stock to jump for joy.
Based on this performance, Wall Street expected the trend to (mostly) continue for Pandora in the first quarter, with forecasts pegging revenue at $123.9 million (on losses of $0.10 per share) for the quarter, compared to a loss of $0.09 per share for Q1 last year — and revenue of $123.5 in Q4. And so it did.
Of his company’s performance, Kennedy said:
Mobile listening hours and mobile ad revenue reached record highs, with growth in mobile ad revenue exceeding growth in mobile listening hours. During the quarter, we successfully implemented a mobile listening limit, enabling us to manage our content acquisition costs with minimal impact on listenership or revenue growth. Pandora’s subscriber base surpassed 2.5 million, adding more net new subscribers in the quarter than in all of fiscal 2013, giving Pandora the largest US streaming subscriber base of any music service.
It’s also interesting to note that Kennedy resigned after last quarter (as mentioned above), yet Pandora’s release today names him as Chairman and CEO. It seems either Pandora’s copy editors need more coffee or their communications team knows something we don’t. Perhaps Kennedy’s resignation (due, understandably, to heavy stress) was a bit more abrupt than intended and announced early. Although that’s not totally clear at this point.
All in all, it was a strong quarter for Pandora, with advertising revenue showing a 49 percent year-over-year increase to $105.1 million, with non-GAAP subscription and other revenue coming in at $23.4 million — a 114 percent year-over-year increase. Non-GAAP basic and diluted EPS were $0.10, right in line with Wall Street’s expectations, while the company ended the quarter with $75.4 million in cash, compared with $89 million after the prior quarter. (Cash used in operation activities came in at about $12.6 million.)
Some other notable metrics: Pandora’s total listener hours grew 35 percent to 4.18 billion for the first quarter, compared to 3.09 billion for the same quarter last year. According to Kennedy, Pandora’s mobile listening hours hit an all-time high this quarter, alongside significant growth of its subscriber base (which Kennedy claims above makes it the biggest in the U.S.).
As to guidance, non-GAAP revenue is expected to fall in the $155 million to $160 million range, while Pandora expects non-GAAP EPS to be in the range of -$0.02 and +$0.01.
Lambda Labs, an early-stage startup out of San Francisco, is preparing to release a facial recognition API for developers working on Google Glass apps. The API will be available to interested developers within a week, company co-founder Stephen Balaban says. The move comes on the heels of a Congressional inquiry into Google’s new wearable technology, which is still very much in the prototype phase.
The startup’s facial recognition API, launched into beta last year, is already used by 1,000 developers, including several major international firms. It now sees over 5 million API calls per month, and is growing at 15 percent month-over-month. Balaban also says that the company has been cash-flow positive since November.
Now that same API has been tailored specifically for Google Glass apps to enable both facial and object recognition.
Applied to Glass, the technology will enable apps such as “remember this face,” “find your friends in a crowd,” “networking event interest matching,” “intelligent contact books,” and more, Balaban explains. (You can see what apps developers are tweeting about here.)
As potentially amazing/horrifying as that technology sounds, any apps using the technology couldn’t do so in real time – that is, you couldn’t just walk around automatically recognizing people you see through Glass. The way Google’s Mirror API works right now is that you first have to snap a photo, send it to the developer’s servers, then get the notification back. The lag time on that would be several seconds at least, and would depend on how fast you could take a photo and share it. A forthcoming Glass software development kit (SDK), though, may change that.
“There is nothing in the Glass Terms of Service that explicitly prevents us from doing this. However, there is a risk that Google may change the ToS in an attempt to stop us from providing this functionality,” Balaban says. ”This is the first face recognition toolkit for Glass, so we’re just not sure how Google, or the privacy caucus, will react.”
The privacy caucus he’s referring to has to do with the Congressional inquiry from earlier this month where eight members of Congress reached out to Google CEO Larry Page with over half a dozen questions about Glass’ capabilities and the potential impacts to user privacy. The Bi-Partisan Privacy Caucus, a group led by Texas Republican Joe Barton, wanted to know if Glass would collect data from users without their consent, whether or not Google would consider privacy before approving third-party apps, and a host of other things.
One of those questions was whether or not Glass would have support for facial recognition. That’s something Steve Lee, Glass director of product management, has already answered. In a statement offered to The New York Times, he replied, “We’ve consistently said that we won’t add new face recognition features to our services unless we have strong privacy protections in place.”
That’s not a solid “no,” of course. It’s more of a “no, for now.” Glass is simply too new of a technology to begin limiting what it will or will not do, at least in such definitive terms.
Facial recognition, however, doesn’t appear to be specifically prohibited in Google’s API policies, which inform Glass developers what they can and can’t do in their applications. That means, for now at least, Lambda’s facial recognition API for Glass developers would be permitted.
The only cause that would impact its use, according to Google’s policies, is one that says Glass is “not intended for use in connection with applications and services that might be subject to industry-specific privacy regulations.”
Obviously, lawmakers could still enact such a policy, if they chose to do so.
“Assuming Google and Joe Barton’s Privacy Caucus don’t attempt to stop us, [the API] will be available to everybody within the week,” Balaban says.
Google, it should be noted, has long since had the technology to build apps capable of facial recognition itself, but has always tread very carefully to not incite a privacy backlash.
In 2011, there were reports that Google was developing a mobile app that would allow users to snap pictures of people’s faces to access their personal information. That app never arrived, but facial recognition has since made an appearance within Google’s photo-sharing service Google+ Photos (previously Picasa), where users can now opt in to have their face recognized. This makes finding “pictures and videos of you easy,” explains the company’s documentation on the technology.
Perhaps one day, users will be able to “opt in” to having Glass apps identify their faces, too?
Time – and Congress’s reaction – will tell.
Image credit: Glass concept from Jack Morgan on Dribble; Additional reporting: Frederic Lardinois
JustFab, the subscription-based fashion commerce site, is putting the $109 million that it has raised so far to use: today it is announcing the acquisition of The Fab Shoes, a European e-commerce shoe club in France and Spain, to build out its global operations. Terms of the deal were not disclosed.
The deal will give JustFab a stronger foothold in the European market: it already has operations in Germany, where it has a European HQ in Berlin, as well as in the UK; now it will be adding France and Spain, with the integrated site coming in July 2013. Growth in Europe has been coming at a fast pace for the company so far. In 2012, JustFab did $2 million in sales, co-founder and co-CEO Adam Goldenberg tells TechCrunch (he shares the CEO role with co-founder Don Resller). ”This year we are on track to exceed $30 million.” The Fab Shoes has slightly more than 500,000 users; combining that with the 1.5 million across Germany and the UK, JustFab will now have over 2 million members, with 15 million worldwide, and is on track to do $250 million in revenue globally ($215 million in the U.S.).
Call it a funny coincidence, but this isn’t the first acquisition JustFab has made of a would-be competitor with the word “Fab” in its name. Earlier this year, the company acquired FabKids to spearhead a move into children’s fashion. “We have a running joke that whoever is called ‘Fab’, we’ll buy them,” says CEO Adam Goldenberg. (And indeed that may not extend to the biggest Fab of all, Fab.com, which apparently is now raising a $250 million round at a $1 billion valuation.)
More seriously, Goldenberg says that his company is not singularly focused on buying up so-called “clones” of its own service. Taking a lesson from some of the challenges companies like Groupon have had digesting large, inorganic acquisitions to scale up their services — from what we understand Groupon has yet to migrate many of its extensive global assets on to a single common platform with the U.S. operation — JustFab has a different approach.
As Goldenberg describes it, the company’s M&A policy is based on acquiring smaller businesses that complement JustFab’s and are also built on the same subscription model. This means that they can be easily integrated into the bigger company’s infrastructure.
There is another reason for this: it’s increasingly a challenge for e-commerce fashion companies these days to raise money, with much of it going instead to those that have proven to have the most scale. “This is part of the reason why we raised such a big round last year,” Goldenberg noted. The Fab Shoes, founded in early 2012, was raising financing — or trying to — when JustFab came knocking.
“Scale and infrastructure are key if you want to grow quickly in the fashion business,” said Pablo Szefner, CEO of The Fab Shoes, in a statement. “While The Fab Shoes has had a lot of early success, we are thrilled to take our core business to the next level. With JustFab, we can provide our existing members and potential new customers with excellent styles, quality and service for an outstanding shopping experience.”
“We met Pablo and Xisco” — Pablo Szefner, CEO of The Fab Shoes and Xisco de la Calle, its COO — “and we decided this would be a great talent acquisition as well.” De la Calle will become the VP of operations for JustFab Europe, while Pablo becomes General Manager for France and Spain, overseeing 12 employees in Barcelona and Paris.
While some have waved a red flag over subscription-commerce sites — the implication being that they are not transparent enough about how they charge users on a regular basis — Goldenberg is insistent that this is a model that works well and is a hit with its customers, and investors. “There is a subscription commerce funding craze right now,” he says. “But because it is so low-cost you have to have the scale to make the economics of it work. We have millions of satisfied customers.”
Looking ahead, he says the company is planning to launch more products beyond the shoes that are the basis of the company’s model. In addition to childrens’ clothes that will go online in June, there is already denim and handbags that altogether make up about 30% of the company’s sales. And he hints that there will be another fashion category being launched later this year. “We’re building the next generation of H&M and Zara,” he says. Through all of that, “we’re staying entirely focused on subscription-based commerce.”
Cloud encoding vendor Encoding.com launched Vid.ly a couple of years ago to provide video creators with a way to publish a single universal video URL and then have that content accessible on any device. Now it’s providing a way to monetize those videos, thanks to an integration with ad delivery platorm FreeWheel.
The idea behind Vid.ly is that Encoding.com does all the hard work of encoding it into as many video formats and renditions as necessary, then serving up the appropriate copy of the video depending on which device was accessing it. In addition to transcoding, it also provided all of the storage, video player technology, device detection, streaming, and analytics needed by video creators. Customers could simply connect with the Vid.ly API and have a single universal URL created for them.
All of that’s great, especially for brands and agencies and marketers who wish to make their videos playable for all audiences on every PC, mobile phone, or tablet. But what Vid.ly didn’t provide (until now) was a way to monetize all of those videos. Hence, the partnership and integration with FreeWheel.
By integrating with FreeWheel’s ad-serving platform, Vid.ly will be able to provide all the same convenience and reach to publishers, but it will also enable them to monetize those videos across all those devices. By connecting with Encoding.com’s user interface or API, when a video is requested, Vid.ly will pass along user info to the FreeWheel ad server and pass along targeted ads along with the video. Pre-rolls, mid-rolls and post-rolls, as well as banner overlays, will all be supported.
Encoding.com has raised $4.5 million since being founded in 2008. While Vid.ly is a growing piece of its business, the company is still primarily focused on providing cloud encoding services to a growing number of publishers moving their content online.
