New York startup LocalResponse has raised $5 million in equity financing.
LocalResponse is an ad network for local check-ins. It monitors multiple platforms, finds business and brand related updates, then responds to users with timely, targeted ads.
Investors include Cava Capital, Vodafone Ventures, Advancit Capital, and Progress Ventures, as well as previous investors Metamorphic Ventures, Extreme Venture Partners, FF Ventures, Acadia Woods Partners and Jim Pallotta.
LocalResponse will use the money to increase its sales team and improve the enterprise version of its product so large brands and ad agencies can use the platform seamlessly.
“We’re super excited to have investors who believe, in making the holy grail of location-based advertising come true. Tweet that you’re excited to watch X-Factor, and don’t be surprised to see an X-Factor ad on a digital billboard near you. Take a picture at a Yankees game and get an offer for a free beer from a nearby vendor. Check-in to a local retailer, and get an offer from them unlocking their latest promotion. It’s all on the table now,” says CEO and co-founder Nihal Mehta.
The response rate for the targeted ads, Mehta says, is high. “The click-through rates we’re seeing are 46%, not .01% like typical banner ads.” In its first month (May), LocalResponse’s $1-5 CPC model generated $50,000 from Twitter ads alone.
LocalResponse was founded earlier this year. Kathy Leake, the cofounder of Media6Degrees, created LocalResponse with Mehta.