Computers' ability to easily read text paved the way for online search advertising to become a multibillion-dollar business. But reading images is a different story. Roughly one-third of the content that appears on websites, or about three trillion images a year, is mostly illegible to computers. Solving this challenge would create a new stream of revenue for online publishers. "Computers today are not good enough at looking at an image and understanding what an image is about," said Ophir Tanz, founder of in-image advertising company GumGum Inc. "It's one of the most challenging problems out there."
In-image ad network GumGum has raised $7 million in new funding from NEA with GRP and First Round Capital participating in the round. This brings GumGum's total funding to $11 million.
Received $7M Series C Funding
Participation New Enterprise Associates, GRP Partners, First Round Capital
When he was 13, Ophir Tanz decided he'd never be able to work for anyone else. By 15, he had started his first company, an interactive branding agency called Fluidesign, which he sold before heading off to college. After graduating from Carnegie Mellon in 2004 with both bachelor's and master's degrees, a brief 10-month stint at the Bridgewater Associates hedge fund confirmed what he had long known: "It was a great salary, I learned a lot, but I just couldn't help myself," he says of his entrepreneurial leanings.
Los Angeles is the second-biggest city in the United States, with a huge creative class and a lot of wealthy investors. But the city's tech startups get a lot less attention than companies based a few hundred miles to the north in Silicon Valley and San Francisco.
With today's technology, for instance, it's possible to give people who read the National Enquirer online a chance to actually buy a zippered-up crewneck sweater that has "the look" of the top that a cancer-stricken Elizabeth Edwards is wearing in a photo on the home page of the tabloid's website.
The paparazzi tracked down Angelina Jolie and four of her children in Venice last week, snapping photos of them eating ice cream. Her fans analyzed the photos, looking for the presence of Brad Pitt, at her new blond highlights and for clues to what she was wearing. Companies like GumGum and Pixazza tag the paparazzi photos with links for buying the clothes. They hire people to look at photos and match the clothes they are wearing with the same or similar, more affordable items from retailers like Bloomingdale’s, Nordstrom, and Zappos. (Image recognition technology is not yet sophisticated enough to automate the process, they say.) The companies get a small fee from retailers when a shopper clicks on or buys an article of clothing. “Publishers and readers look at it as this really informational resource,” said Ophir Tanz, chief executive of GumGum, which tagged the photo of Ms. Jolie with one of its “Shop this look” badges. “We look at it as an ad unit.”
Received $2.6M Series B Funding
Participation GRP Partners, First Round Capital
Received $1M Series A Funding
Participation First Round Capital, Crosscut Ventures
Received $225k Angel Funding