CBS Corp. and two advertising holding companies, WPP Group and Interpublic Group of Cos., are participating in the Los Angeles start-up's $40 million third round of financing. Former News Corp. executive Lachlan Murdoch and Israeli investor Vivi Nevo also contributed to the deal.
The new funds, said Spot Runner's co-founder, David Waxman, will be used to develop additional services in new mediums, including IPTV, video-on-demand and internet video, as well as to improve its existing offerings.
Targeting ads in local markets
Interpublic and WPP intend to use Spot Runner's services to help clients target ads in local markets. The Diamond Promotion Service, a unit of WPP's global ad network JWT, this summer used Spot Runner's services to develop a series of customized, local advertisements and made them available to the national and local jewelers it serves. Spot Runner bills itself as being able to create ads for a fraction of the cost of those created using traditional commercial production. A local ad campaign, including commercial air time, can cost as little as $500.
CBS believes Spot Runner's services provide an efficient system to sell its diverse ad inventory. Its "technology provides broadcasters the opportunity to expand the demand for local advertising by providing clients a quick and easy way to promote their businesses," said Joseph Ianniello, senior VP-finance and chief development officer, CBS Corp. He said that Spot Runner's technology will increase advertising demand and also continue to allow stations to control their inventory.
Spot Runner is the third company built by Mr. Waxman and his business partner Nick Grouf. Their earlier ventures were PeoplePC, which was purchased by Earthlink in 2002, and Firefly Network, a developer of personalization software, bought by Microsoft in 1998. The internet-based ad agency debuted in January backed by a $10 million round of financing led by venture capital firms Index Ventures and Battery Ventures.