ZypMedia - programmatic advertising - online video startups - Fierce 15 2015

Where it's based: San Francisco
When it was founded: 2013
Website: www.zypmedia.com

Why it's Fierce: ZypMedia, formerly known as ExtendTV, may have found the perfect niche at the perfect time. The company, which focuses exclusively on local TV markets with its programmatic advertising services, has attracted a major customer and investor in Sinclair Broadcast Group.

And it did so just as other major broadcast groups began to pay much closer attention to their local TV station assets--particularly their largely untapped value in the OTT space.

ZypMedia's software platform allows local station sales forces to sell and place ads not just on-air, but online, opening up new revenue opportunities for stations and giving local businesses a wider audience reach. The platform also returns much deeper metrics thanks to the online angle, giving advertising clients a better look at the results of the campaigns they've paid for.

Programmatic advertising has largely been the purveyance of large national brands and major platforms like YouTube. Small local businesses like Al's Plumbing have not really been the focus of sales teams for wide-reaching OTT services like, say, Hulu. But as broadcasters figure out the licensing and distribution puzzle that has kept local stations from having a bigger presence online, adding a local advertising element is becoming much more important.

"In the last six months, we've seen a significant acceleration in demand at the local level," ZypMedia CEO Mark Goldman told FierceOnlineVideo.

ZypMedia began testing its platform in April 2014 with a small number of local stations, including some owned by Sinclair. "We learned that it worked and there was a lot of demand at the local level for programmatic, video, display, all of it," Goldman said. "The stations asked us to expand from just [online] video to a full range of programmatic services. So basically that's what we did. The core technology was always optimized for that due to it being built for video, which is the hardest piece."

ZypMedia's name is a play off the term "ZIP code," and it is meant to reflect the speed at which its platform works as well as its focus on local areas.

What's next: With its $4.4 million Series B funding round having just closed and its deal with Sinclair finalized, ZypMedia is focused on scaling up--and fast. The company is moving from serving about 300 salespeople to nearly 3,000 nationwide, and it has increased its own staff from eight to 18, with plans to grow to 30 or 40 employees, Goldman said.

ZypMedia - programmatic advertising - online video startups - Fierce 15 2015