Looks like we made it.
It’s with great excitement that we introduce the 2010 OnMedia 100. This fresh batch of the hottest emerging companies in digital advertising joins illustrious alumni and gives us a great deal of insight into the coming trends in monetization.
Last year was digital media’s trial by fire. Some online business models were forged in the flames; many more were burnt to a crisp. As we look out on 2010, we see a more hospitable landscape. Advertisers are increasingly selecting online surgical strikes over offline dynamite fishing. A fact to which 2010 OnMedia 100 winners Yieldex, Yield Software, and YieldBuild can happily attest.
The digital media industry has good reasons for its optimism. J.P. Morgan is projecting more than 10% growth in U.S. graphical advertising and more than 13% growth in U.S. search advertising, representing a marginal increase in spending of roughly $4.5 billion in the coming year. Many of these new dollars will be directed toward or by 2010 OnMedia 100 companies.
Given this backdrop of anticipated growth, it’s not surprising that we see so much activity among OnMedia 100 alumni. In the last year, billions of dollars in value have been created by recent OnMedia 100 winners, including Zynga’s eye-popping $180 million financing, Google’s $750 million acquisition of AdMob, and Apple’s $275 million acquisition of Quattro Wireless, as well as dozens of significant financings, including major rounds to alumni like Quantcast, Aggregate Knowledge, and Ensequence.
Venture investing in media and entertainment from Q4 2007 to Q3 2008 totaled $1.9 billion (according analysis from PricewaterhouseCoopers and the NVCA). The same period during the following year saw this total drop precipitously to $1.2 billion. Clearly the flight to quality saw OnMedia 100 companies outperform in attracting growth equity.
We have every expectation that the class of 2010 will perform just as well as past winners in attracting customers, capital, and acquirers. Companies like ADVERTISING NETWORKS AND EXCHANGES winner MediaMath are letting advertising agencies more effectively leverage online channels on behalf of their clients. While HubSpot is the digital marketing command center for thousands of mid-market companies.
The explosion of local services has made small the new big. Winners like Yodle and Yext are bringing the full power of the Internet to bear on local merchants by finding the right recipe of cost effectiveness and ease of use. Our COMMUNITY PLATFORMS category winner, Gilt Groupe, has found the seam between tough economic times and demand for luxury products, letting its members find attractive merchandise at even more attractive prices—creating a new distribution channel to brand-conscious consumers.
Coremetrics leads our WEB AND MEDIA ANALYTICS AND RESEARCH winners and is rapidly establishing itself as the pre-eminent toolbox for online marketers. Services like GumGum for online content distribution, AdSafe Media for contextually appropriate advertising, and Lattice Engines for analysis and planning tools, are tackling specific challenges in online optimization and monetization.
While these new online services are polishing the Internet advertising apple, the mobile sector continues to be an increasingly wild, wild west. Fueled by the rapidly escalating thumbs-race between giants like Apple, Google, Nokia, RIM, and Microsoft, the stage is set for tremendous innovation in the private company community (and impressive returns for private capital).
Our overall winner for the 2010 OnMedia 100, Millennial Media, has positioned itself as one of the leading mobile advertising networks. With competitors (and previous OnMedia 100 winners) AdMob and Quattro Wireless acquired by Google and Apple respectively, and armed with a recent round of financing, the company is clearly capitalizing on its already impressive position.
The 2010 OnMedia 100 winners have survived the upheaval of 2009 and are positioned to advance on the opportunities represented by the return to growth in the digital advertising sector. Congratulations—it looks like we made it.
You can see the entire list here.
Ezra Roizen is an AlwaysOn contributing editor and partner with Ackrell Capital, where he advises emerging digital media and e-commerce companies on financing, M&A, and strategy.