Nanigans Raises $24M To Fuel Asian Growth And Expand Its Ad Tools Beyond Facebook

Leading Facebook ad company Nanigans is announcing that it has raised $24 million in Series B funding.

In what has become a fairly common move, Nanigans is taking money from a big Asian investor, in this case Chinese Internet company Cheetah Mobile. Naturally, the hope here is to accelerate Nanigans’ growth in that region.

Co-founder and CEO Ric Calvillo noted that the company already has an Asia-Pacific office in Singapore that’s doing “pretty well.” He also suggested that there’s still a particularly large opportunity in China, not just for display advertising, but even on the Facebook side — even though, Facebook is still blocked by China’s “great firewall,” Calvillo said Chinese businesses are still advertising on the social network to reach audiences outside China.

Until now, Nanigans had raised just under than $9 million in funding — not much, when you consider that it currently manages $500 million in annualized ad spend, and has offices in New York, San Francisco, London, and Sydney (plus its headquarters in Boston and the aforementioned Singapore office). Calvillo said the company has been “essentially bootstrapped” thus far, covering its costs by building a profitable services business around its ad platform.

Less than a year ago, however, the company began to switch from the standard ad company business plan (offering additional services and charging a commission on ad spend) to a software-as-a-service model. At this point, Calvillo said about 70 percent of Nanigans’ customers have moved to an annual subscription plan, and by the end of June, they should all have made the transition.

Why the big shift? Well, Calvillo described the SaaS model, particularly one with a yearlong commitment, as “a litmus test” that determines whether customers are really buying the technology or just viewing you as “a glorified agency.” If you can convince customers to make the switch, then you’ve got more reliable revenue, and you’re valued more highly by investors — in fact, Calvillo suggested that Nanigans might not have been able to raise the round if it hadn’t made the transition.

And yes, while discussing the move, Calvillo repeated referred to Wall Street’s opinion, so before I had to ask, he went ahead and addressed the IPO question: “If we’re going to do a round of funding and possibly a public offering two or three years from now, we need a strategy that works for a public company — and that has to be a SaaS model.”

Nanigans will also be expanding its tools beyond Facebook, a process that began last fall thanks to an integration with Twitter-owned MoPub. Calvillo said Nanigans clients have said they want to use the company’s ad optimization and analytics technology for other types of advertising, both in display and social media.

The challenge in moving to new ad channels is the fact that the ad-buying is often “siloed,” Calvillo said — so even if there’s an advantage in having one product to manage all of a company’s digital ad spend, it also has to be “best of breed” in each area. At the same time, continuing to improve the Facebook product (and keeping up with shifts in Facebook’s ad platform) will remain Nanigans’ “number one priority.”

“That’s why it’s taken us so long to be multi-channel — they have a very high bar,” Calvillo said.

from TechCrunch http://feedproxy.google.com/~r/Techcrunch/~3/UxS0TNrlq1A/

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