Singapore and Bangalore-based Adnear Pte Ltd (formerly Imere Technologies), a location-based mobile advertising platform that supports both feature phones and smartphones, recently raised Rs 35 crore ($6.3 million) in Series A funding from Sequoia Capital and Canaan Partners. The company's advertising platform also provides location awareness on mobile phones without GPS or operator assistance.
Techcircle.in caught up with Anil Mathews, founder and CEO of Adnear, who shared with us the reason behind recent funding, what the company is trying to achieve and its path to profitability. Here are the edited excerpts.
Is this your first round of funding?
This is our Series A round, but we had received a strategic investment from Rediff.com back in 2009.
Why did you raise the funds?
Working capital requirements in this business are different as the payment cycle in the digital advertising space is not that regular. So companies have to ensure that they have the working capital for the next few quarters because you can't really depend solely on the revenues you are generating. Also, our competitors are raising a lot of money. So we had to raise it to expand and stay in the competition.
Earlier, app developers and publishers were hardly making any money, mostly because advertisers were not putting a lot of money in mobile advertising. But the scenario is now changing drastically. Companies now keep a separate budget for mobile advertising. This is where we come in â€“ we want to capitalise on this and make sure that we can be a premium network in this ecosystem. That's why we got the funding.
Where will you invest the money? How long will this round last?
The funds will be mostly utilised to expand our operations in other Asia-Pacific countries as the market in India is not as mature as other countries like Australia. We are planning to open two sales offices in Mumbai and Delhi, and another office in Australia. These will be up and running in the next six months and our team will also grow from the current 20 to 60.
We will be raising our Series B round in the next 15 months, but we haven't yet decided the size of that round.
So what are you trying to achieve with Adnear?
The biggest pain point of mobile advertising is that most of the ads are charged according to the number of impressions (page views by visitors) they get. But getting clicks may not result into business conversion and that's why brands are not getting the desired return on investment although they are putting money into mobile ads. At Adnear, we are trying to change that. Instead of just facilitating impressions, our location-based mobile advertising platform also ensures enhanced user engagement, thus increasing the ROI.
For instance, if you are in a certain area in Mumbai, we show you the ad of the nearest Pizza Hut, post which you can find directions to the joint and eat there. Hence, there is a cycle where consumers use their mobile phones for discovery and it will then lead to fulfilment. This is where the ad engagement part comes in.
In the west, companies like Where.com it was later acquired by PayPal), Nokia advertising and JiWire are offering the same services. But we have the first-mover advantage in the geographies where we are currently present.
What's your revenue model?
Unlike other mobile advertising platforms who charge for ad impressions, we also charge for the ad engagement because of our location-based ad targeting. As of now, we power nearly a billion ad impressions on a monthly basis.
How many clients do you currently have?
We have around 25-30 clients including brands and advertisers such as Titan, PizzaHut, Nokia, Toyota, Ford, Samsung and Airtel, among others. We are servicing clients in India, Singapore, Australia and other Asia-Pacific countries.
Finally, what about profitability?
We are looking to become profitable in the next 24 months.
(Edited by Sanghamitra Mandal)