VigLink Receives $5.4M Worth of Series B Funding

VigLink will be accelerating their hiring efforts as they take on further product development and expansion projects. This is primarily how VigLink plans to use the company’s recently acquired $5.4 million worth of Series B financing.

This round was led by Emergence Capital, and was also participated in by Google Ventures and First Round Capital.

Their CEO Oliver  Roup discusses more about VigLink as well as their most recent funding success in this recent e-interview with Lead411:

Who are your competitors and how are you different from them?

VigLink helps publishers capture the value they’re sending to other sites through outbound links. Any clicks going to merchants (places like Amazon and eBay) are modified to capture available commissions.  Optionally publishers can have new links inserted into their content as well. We mostly compete against ignorance – the overwhelming the majority of the time we’re trying to explain what content monetization is, rather than trying to differentiate from a substitute.

There are alternatives like Vibrant and Kontera who anchor roll-over pop-up ads to relevant words in your content. They can be lucrative for certain sites but some complain they intrude on the user experience.  There are also a few direct competitors in Europe, but it’s a pretty new space.

What marketing tactic has given you the highest ROI?  What percentage ROI do you get back on this?

Events have been a huge success for us.  We hosted San Francisco’s first Forum & Communities conference (ForumCon - www.forumcon.com) in February and the event sold out.   The conference brought together leading brands, forum owners and community managers to explore strategies for forum and community development. We’re not going to share a percentage ROI but ForumCon Chicago will be in the fall if that’s any indication.

We also sponsor a monthly blogger meetup that has been a great way to connect with new clients.  We’ve seen an excellent return on both.

What do you plan to spend your new funding on?  Product development?  Marketing?

This latest round of financing will be used to accelerate VigLink’s product development hiring and our expansion into new content verticals and geographies.

If this is your first round of financing and you’re the CEO, how many hours did you put into working on getting your financing?  Was that taking up the most of your day?

The first round of funding was a marathon and I pitched almost 100 investors before Google and First Round Capital said yes. The most recent round was as easy as these things ever get – we had numerous investors interested and closed with Emergence Capital very quickly. It’s amazing how much easier it is when you have results!

If you are the CEO, what are your biggest challenges?

I’ve got a strong background in engineering and product work, but I didn’t have a lot of depth in marketing. Like most people, I tended to focus on what I’m good at and so we were slow out of the gate with that. A key challenge for the business is the lack of knowledge around content monetization.  Publishers aren’t always aware of the value of the traffic leaving their site, and the ways they can capture a piece of that value. Educating our potential customers about that value is essentially a marketing function and so we’ve had to learn and adapt.

Another challenge facing the performance marketing community is the evolving tax landscape in certain US states. Cash-strapped states are considering out-of-state retailers as potential revenue sources, and several have passed (or are considering) laws that rope affiliates into the conflict by deeming them extensions of the online retailers.

In those states, the retailers have responded by firing all their affiliates and so the state loses not just the tax revenue but the jobs as well. However, we don’t anticipate it to be a long term issue. Many of the states that had been considering some of these moves have observed what’s happened in states that have passed the legislation and are thinking better of it.

How many employees do you have?

We acquired one of our competitors in August so we now have offices in San Francisco and Chicago. Between them we have about 20 employees and growing.

When were you founded?

We incorporated in March 2009, raised seed funding in June of that year and officially launched in January 2010.

How much did your revenue increase (if any) this year over last year?

Given we were launching a year ago, percentage increases would be meaningless, but it’s been fantastic. As I mentioned, we had no trouble raising the last round so that should tell you something.

Want to read more about their recently acquired financing? You can check out VigLink’s press release here.