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Extreme Reach Inc. has raised a total of $2.6 million in venture funds, investors confirmed yesterday. The Needham-based company, which digitally delivers video ad content, in March announced an undisclosed amount of funding, as New York-based Greycroft Partners joined existing investors, Western Massachusetts-based Long River Ventures and Village Ventures.
On Wednesday, Greycroft principal Ian Sigalow confirmed the March funding was a $1.1 million add-on to the startup’s Series A round, initially closed in November.
“The company is doing very, very well,” Sigalow said. “They’re one of the big success stories in terms of customer acquisition.”
Sigalow said Extreme Reach is now No. 2 in digital ad content delivery to DG FastChannel Inc. (Nasdaq: DGIT). The leader, which Sigalow described as a monopolist, was formed when DG Systems Inc. acquired FastChannel Networks Inc. for $40 million in 2006.
Extreme Reach was founded in the first quarter of 2008 by four former FastChannel executives. Both companies deliver video content for TV, cable and online ad networks.
Co-founder and CEO John Roland said Extreme Reach has grabbed market share quickly with a lean combination of software-as-a-service (SaaS) delivery and social media-based marketing. An online social network of advertising traffic managers has enabled the customer base to grow virally, he said.
“It’s very much like a LinkedIn model where customers that are in our network can invite others to join the network,” he said. “It could be a TV station or ad network inviting an advertiser.”
The network now has up to 300 invites a day, turning the company’s customers into an extension of its sales force, he said.
Roland said the company has kept itself capital efficient. “We didn’t need the additional capital, but the reason we wanted it is the opportunity has been really strong for us and we’ve executed well,” he said. “We thought we could accelerate the opportunity.”
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