By Radhika P Nair
Komli Media, India’s biggest online media technology platform for advertising, has raised $39 million, or Rs214 crore, in the biggest round of fundraising by an internet company in the country this year.
Norwest Venture Partners led the latest round with participation from existing investors- Nexus Venture Partners, Helion Venture Partners and Draper Fisher Jurvetson- along with one new investor, Western Technology Investment.
Komli’s CEO Prashant Mehta declined to disclose the valuation of the Mumbai-based company in a deal which takes the total private equity capital raised by it to $62 million. Industry experts said that internet companies in India are typically valued at up to five times their revenue. Komli, which is targetting revenue of $100 million in 2013, can therefore be inferred to have a value of up to $500 million.
“Considering that advertising spends are the first to get affected in a downturn, this investment has greater significance than just the amount invested,” said Mayank Rastogi, a partner who specialises in private equity at consultancy Ernst & Young.
The month of May saw the lowest amount of private equity investment in the past year, with just $385 million in funding for 32 deals. In contrast, in May 2011, there were 44 deals, in which close to $1.3 billion was invested. Mr Mehta, whose company counts Facebook as an exclusive partner in India and expects a Nasdaq listing within 18 months, was of the opinion that even though the overall environment is gloomy, it is not so for the digital media industry.
“We are at a tipping point. Komli thinks the digital medium is far more accountable and provides greater return on investment,” he said The online advertising market in India is estimated to be worth Rs1,850 crore, which is just 7 per cent of the overall advertising pie, according to an Avendus Report. However, the sector is expected to grow rapidly to Rs7,000 crore by 2015. Google and Facebook collectively account for about 29 per cent of direct advertising spends.”
Founded in 2006 by Amar Goel, who is also the chairman, Komli has been aggressively buying companies overseas to speed up growth. In February, it made its sixth acquisition in two years, buying Singapore-based online advertising network Admax.
Last year, Komli took over the India business of video advertising venture Jivox and in July 2011, it acquired mobile advertising and publishing network Zestadz. The Zestadz acquisition marked Komli’s entry into the fast-growing mobile advertising segment.
“It is in the mobile advertising space that Komli competes directly with Google’s AdMob, which is the market leader globally and in India, and with InMobi,” said Srinivas Chari, cofounder and chief marketing officer of Xerago, a digital and interactive marketing company.
Source: The Economic Times
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