Spot Runner Raises Another (Really) Big Round

Spot Runner seems to keep raising money. Today the company is announcing another mega-investment round; this time $51 million, from Daily Mail and General Trust (DMGT), Grupo Televisa, Legg Mason Capital Management and Groupe Arnault/LVMH, along with some existing investors.

That brings the total money raised to date to more than $100 million. Ka-ching!

The official word is that the money will help expand the scale and scope of existing operations as well as major international efforts. Spot Runner has been a takeover target for some time but the size of such a deal now would need to be very very large. The valuation must now be several hundred million dollars. The company is rumored to be profitable and could be an IPO candidate at this point. (Several prominent hires could suggest something like this.)

Spot Runner made a few strategic miscalculations in the past, which it has arguably now corrected by buying Globe Shooter and Weblistic, now being integrated. The company is moving toward a multi-platform media buying strategy in which agencies and marketers can integrate both online and offline media buys — and localize them. This is the future and Google is pursuing a similar vision in a somewhat different way. (See also my post on Live Technology Holdings.)

Seen as a video platform or “agency” for SMBs — the company has come a very long way from that original vision — Spot Runner faces increasing competition from smaller startups; there are probably 10 or so one could point to. But here’s the “secret sauce” and what makes this company potentially extremely valuable for not-so-obvious reasons: addressable advertising.

Brandweek has a good story on this coming phenomenon in TV; it’s partly what the future vision for Google TV is too:

Industry watchers say addressable advertising—the ability to target TV ads by household so that, say, a 50-year-old man watching Lost would see a different ad than a 14-year-old girl watching the same show next door—is getting closer to a national rollout.

From the same article:

In the meantime, some advertisers are flocking to what may be the only form of national addressable advertising on the market. Spot Runner, a local television advertising firm in Los Angeles, is helping advertisers adopt addressable advertising on the local level through national buys. The company did so last year when Warner Independent Pictures released The Painted Veil. It targeted ads for the art house film to mature female viewers in the 18 specific neighborhoods where the movies were playing. Gus Warren, vp of strategic partnerships at Spot Runner, said even without set-top box capability, Spot Runner can target as few as 500 homes with the right commercial.

(emphasis mine.)

So Spot Runner is a localization and an emerging cross-media buying platform for agencies and advertisers, but it can also deliver something today in television that others cannot — as TV comes under increasing pressure to justify ad rates.