$13.5 Million for Online Video Analytics Startup Visible Measures; Seeing What Happens After Viewers Press the Play Button

1/28/08Follow @wroush

Advertising dollars are fleeing print media and flocking to the Web partly because Web technology makes it so much easier to measure whether audiences see or interact with individual ads. But this isn’t so true for Internet video. Publishers generally “have no idea what’s happening after the play button is pressed,” says Brian Shin, CEO of Boston-based Visible Measures. “That leaves lots of unanswered questions, like, ‘Did someone even see my message? Which part of the video do people care about? At what point are they leaving?’”

Technology that answers such questions would naturally be of interest to big media companies with lots of video to sell or share—not to mention their advertisers. And that’s driving a lot of investor interest in the space. As Bob reported last week, Polaris Venture Partners has put $20 million into San Francisco-based audience measurement firm Quantcast, which analyzes the behavior of website audiences (including their usage of Flash-based video players and other embeddable widgets). And today Shin, who is in Palm Desert, CA, to unveil his company’s “VisibleSuite” audience measurement system at the Demo 08 conference, announced that Visible Measures has closed a $13.5 million Series B funding round led by Menlo Park, CA’s Mohr Davidow Ventures and Cambridge, MA-based General Catalyst.

Brian Shin, co-founder and CEO of Visible MeasuresThat’s a lot of dough for a company that’s already taken $5 million in seed money and Series A funding and is just rolling out its software now, after three years of development. But Shin says the investment is justified by the size of the market Visible Measures is pursuing. New York market research firm eMarketer projects that spending on Internet video advertising will reach $4.3 billion by 2011—or about $1 for every $10 spent on Internet advertising overall. “If you’d told me a year ago we would be raising this large of a B round, I wouldn’t have believed you,” Shin said in a phone interview this afternoon. “It’s the size of the opportunity that’s driving it.”

Shin says Visible Measures’ software can be integrated with online video players, where it collects moment-by-moment data on each user’s behavior. “At what point do they pause? Are they rewinding and watching a certain segment over and over? At what point do they embed it in a blog, at what point do they send it to a friend? These interactions tell a bigger story about how audiences engage with your video content,” Shin says.

And that bigger story is something publishers can take back to their advertisers. If an online video site discovered, for example, that viewers were rewinding the climactic crash in a car-chase video over and over, they might pitch that moment to advertisers as the best point for a so-called “instream” ad (as opposed to “pre-roll” and “post-roll” ads that appear before or after a video’s main content).

“Another example might be, say you have many different versions of your creative that you are experimenting with,” says Shin. “You can put it out to an audience and let them view it to see which one seems to be resonating. The whole Internet can be your focus group.”

A Glimpse of the Visible Measures DashboardAlas, I was unable to get Shin to focus much on how Visible Measures’ technology actually works, how the company is able to track user behavior for videos that users have lifted from their original locations (such as YouTube) and embedded in blogs or other sites, or exactly what kinds of actionable insights the system is producing for the company’s beta users, which include local news portal Boston.com and audience-voting site FunnyOrDie. He says more news about the company’s technology platform is on the way in the coming months. “It’s a big vision we’re going after, so we’re trying to communicate it in small pieces,” Shin says.

Quantcast, the Polaris-backed company, is a bit more open about its own viewer-tracking technology. According to the specifications Quantcast has published for its application programming interface, publishers can embed invisible markers in their videos that notify Quantcast’s servers whenever a video is played, paused, resumed, rewound, fast-forwarded, or completed. That way, advertisers can know whether anyone actually viewed pre-roll, post-roll, or instream ads.

Shin says Visible Measures will use Series B round to fuel expansion; the company also announced today that it has acquired Vidmeter, a small startup whose software will help the company track virally-distributed videos. But for the next year, at least, Visible Measures’ focus will be on working with big media companies rather than distributors of YouTube-style user-generated content. “I can’t really disclose the guys we’re working with yet, but more or less the major media,” says Shin. “We’re trying to help them understand their audiences and increase the quantity and quality of audience behavior.”

Wade Roush is a contributing editor at Xconomy. Follow @wroush

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