ExtendTV, which has been targeting the largely untapped local TV market with its programmatic media-buying platform, is rebranding itself as ZypMedia in the wake of a successful Series B funding round in which it garnered $4.4 million. The company also finalized a long-term commercial agreement with Sinclair Broadcast Group to provide its programmatic software and support to Sinclair's local sales teams in 79 markets.
Sinclair led ZypMedia's funding round, with pro-rata participation from US Venture Partners, ZypMedia's existing investor.
The deal is a huge coup for ZypMedia, which will immediately scale from supporting 300 salespeople offering its programmatic services to local clients, to nearly 3,000. Its employee base has grown from eight to 18 people in just two months, with plans to expand to 30 or 40 employees in the next year, ZypMedia CEO Mark Goldman told FierceOnlineVideo.
ZypMedia's niche, along with its media-buying software, were what attracted Sinclair to the company. "They tested a number of different groups that provide these services, and what impressed them is we built our operation around servicing local as our sole objective."
Sinclair's Rob Weisbord, COO of its Digital Group and new member of ZypMedia's board of directors, confirmed that. "After testing a number of different solutions, it was clear that the ZypMedia platform produced superior results for our clients and their level of service was widely praised by our team. We are confident that this partnership will prove to be a crucial asset in our digital strategy moving forward."
"There are some national players" selling programmatic services to smaller TV stations, "but nobody is fully dedicated to local stations," Goldman said. However, in the last six months, demand for programmatic at the local level has "accelerated dramatically."
ZypMedia may have hit the market at just the right time. Just yesterday, five major station groups including ABC Owned Television Group, Cox Media Group, Hearst Television and others announced they would be developing mobile apps that would enable their local TV stations to live-stream newscasts. Louis Gump, the initiative's new CEO, confirmed to FierceOnlineVideo that they will be developing an advertising strategy for NewsON, but didn't elaborate.
Founded in 2013, ZypMedia began beta-testing its new platform in April of last year. Sinclair was among the first to participate in the test, with a small number of its local stations using the software. "We learned that [our core technology] worked, and we also learned that there was a lot of demand at the local level for programmatic, video, display ads, all of it. The stations [participating in the test] asked us to expand from video-only to a full range of programmatic services," Goldman said.
The software platform also helps local advertising clients target specific audiences, not just on TV but across multiple screens. That is changing the way that local salespeople approach advertising clients.
"What we're seeing is increasingly they're going out and offering an audience approach to sales, rather than a screen approach," Goldman said. "Historically they have sold TV air time. Now they're saying [to clients], 'who do you want to reach?'"
For more:
- see the release
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