Exclusive: Mobile advertising company 4INFO has raised an additional $14 million in funding led by Paul G. Allen’s Vulcan Capital, with Mitsui Global Investment and existing investors Draper Fisher Jurvetson, Gannett, Mezzanine Capital and U.S. Venture Partners participating. This brings 4INFO’s total funding to $52 million.

Founded in 2005, 4INFO has dominated the SMS ad space, with roughly 3,000 publishers on its msgHaven platform. For those unfamiliar with their B2B product, 4INFO’s publishing platform helps publishers manage their SMS content and delivery. MsgHaven delivers around 400 million text messages each month (which has doubled in the past year).

But last year, the network expanded to mobile advertising via display/apps through its AdHaven platform and audience network. The AdHaven Mobile Audience Platform includes a next-generation mobile ad server with advanced targeting and data management capabilities.

AdHaven can serve 360-degree mobile advertising campaigns across the mobile Web, rich media, mobile video, applications, tablets, and SMS. Advertisers can integrate AdHaven’s targeting technology into their existing exchanges and networks.

And today, the company is announcing that it is spinning out AdHaven from 4INFO as a separate company due to the success of the product. 4INFO’s CEO Zaw Thet says that AdHaven is now reaching 90 million uniques per month.

As Thet explains, “it’s time for the mobile advertising industry to catch up with the targeting and data capabilities that media buyers demand from online advertising.” AdHaven provides that audience targeting option for advertisers.

The new funding will be used towards expanding the AdHaven platform. The company will also be looking at making strategic acquisitions in the near future. Last year, 4INFO bought Butter, a company that specializes in creating customized mobile solutions and ad campaigns for the iPhone and Android platform. 4INFO will also be looking to expand internationally. And the company is profitable.

Until now. A source tell us that ValueClick (NASDAQ: VCLK) has acquired mobile advertising network Greystripe for $75 million in cash.

Greystripe has raised $18.1 million in funding to date over four rounds. They have a direct sales force that sells rich mobile ads directly to brands, and are on pace to bring in $25 million – $30 million in revenue this year, with about $6 million in gross profit.

Update (25 April 2011): ValueClick has formally confirmed the acquisition of Greystripe, which is said to serve media impressions to over 30 million users through more than 3,500 application titles and mobile websites across all major mobile platforms. Under the terms of the transaction, ValueClick paid approximately $70 million in cash, and Greystripe’s management team and employee base have been retained by ValueClick.

There are still a number of independent startups in this space looking to be acquired or even have a public offering. 4INFO is among the strongest, and focuses on the platform (app) side of the business over the sales side.

JumpTap recently raised $20 million and has raised a total of nearly $90 million to date. Millennial Media is said to be considering an IPO in the near future.

Most recently, Colwell was the vice president of national and direct sales at display ad network Collective. Colwell has helped to create mobile campaigns for brands including Discovery, Bank of America, Procter & Gamble and Ford and was previously vice president of mobile video ad network Transpera (which was recently acquired by Tremor Media).

He was also senior vice president of Third Screen Media (which was bought by AOL). Colwell has also held several sales and marketing positions at Yahoo, Lycos, Engage Technologies, Adsmart, Pointcast and Ziff-Davis.

Founded in 2005, 4INFO has dominated the SMS ad space, with roughly 3,000 publishers on its msgHaven platform. This publishing platform, which allows clients to manage the content and delivery of their SMS campaign, delivers around 400 million text messages each month (which has doubled in the past year).

The network, which has raised $38 million in funding, also reaches 78 million uniques a month in mobile display/apps through its AdHaven platform and audience network. The company is now profitable and pouring that money back into R&D and hiring.

In a recent Nielsen report for US mobile display advertising, 4INFO tallied more than 63 million uniques for the month of September, or roughly 75% of the market. That put them in second place, ahead of Microsoft’s Extended Ad Network, Quattro, AdMob and Jumptap. Millennial was number one with 72 million uniques.

With a reach of 63 million per month, 4INFO’s mobile display business has now eclipsed the company’s original bread and butter: SMS advertising. Its SMS ad network touches roughly 45 million per month.

Founded in 2005, the mobile advertising company has dominated the SMS ad space, with roughly 3,000 publishers on its msgHaven platform. This publishing platform, which allows clients to manage the content and delivery of their SMS campaign, delivers roughly 400 million text messages per month.

And yet for all the success with SMS, 4INFO’s CEO, Zaw Thet has been trying to reshape the company as a one-stop shop for all of mobile advertising.

Now, no one would call 4INFO the king of mobile just yet, but Thet has made significant strides in 2010, picking up Butter in June (a startup that creates customized mobile solutions), fleshing out AdHaven, its mobile ad management platform, and leveraging its SMS relationships.  Explaining the recent jump in display advertising uniques, Thet says the company has made progress by “moving up the stack from the existing SMS relationships we have with the top publishers and media companies in the US and signing new platform deals.”

This Tuesday, the company is also rolling out a new version of AdHaven, which will provide a more comprehensive suite of mobile advertising tools. Beyond display and SMS ad management, the platform will feature full support for in-app rich media, video and a software development kit.

4INFO CEO Zaw Thet is trying to shed the title, “King of SMS.”

The mobile advertising company dominates the US SMS market, delivering some 400 million text messages each month (its monthly rate has roughly doubled from early 2010)— but Thet is tired of his crown, or rather, he’s eyeing a different one. 4INFO is trying to position itself as the largest mobile advertiser, SMS and beyond, and the company is ready to acquire other players to get it there.

“The way we look at it now is let’s be the best damn mobile company in the world,” Thet says. “[We want to] be the only mobile media platform that works with top tier publishers and advertisers to deliver the highest value per interaction…That means across every mobile channel (SMS, display, apps, etc.) and every type of mobile interaction.”

The first part of this (some might say overly ambitious) campaign is its acquisition of Butter, a company that specializes in creating customized mobile solutions and ad campaigns for the iPhone and Android platform. The cash and stock deal, announced this Tuesday, is a modest takeover— a source believes Butter’s valuation didn’t break seven-figures— but it embodies 4INFO’s major shift in strategy.

Butter is not incredibly unique in its basic products, a few other companies are trying to create rich mobile ad experiences (like Medialets, Apple iAds) but Thet says he was drawn to their team, the roster of clients, which includes Coca-Cola, and especially their approach:

“The thing that we found very interesting about Butter was the fact that most of their advertising buys that they were getting weren’t coming from the mobile ad budgets. For viewers who are not familiar with the way that media works, there’s typically line items in each different advertising plan, for how they’re going to spend their money, x amount goes to TV, x amount goes to the web…what Butter had done is they had been able to break out of that bucket of just being an experimental, mobile ad budget line item… That meant to us that there’s something valuable there beyond just the technology, which was interesting, but the actual relationships and the network that they built in a very short amount of time.”

From Butter’s website:

As I noted above, this will be the first of many acquisitions for 4INFO, as the company tries to create a one-stop shop, mobile ad destination. Thet has a decent purse to work with, the company has raised approximately $40 million since 2005 and revenues are climbing at a feverish pace. According Thet, revenues will likely quintuple—possibly sextuple— this year. So they have the money, but will it work?

They’ve certainly proven themselves in the SMS category, the company boasts a network of roughly 3,000 publishers, with some of the biggest publishers paying as much as $75,000 per month to use the platform. For those unfamiliar with their B2B product, the main backbone of 4INFO is a publishing platform, “msgHaven,” which helps publishers manage their SMS content and delivery. The company also features an advertising platform, called “adHaven,” which includes an ad network for mobile ads. The company has expanded beyond SMS, notably moving into mobile display ads in 2009, but it definitely has a lot of ground to cover.

Of course that ground has also become more challenging. Now that Google and Apple have rushed onto to the scene with their recent acquisitions of AdMob and Quattro, their shadows loom over the market. Noah Elkin, a senior analyst at eMarketer, says 4INFO had a better chance of dominating the market 6 months ago (pre-Google/Apple takeovers), but he says their fundamental strategy of building a comprehensive mobile ad house is sound, as more companies look for rich ad experiences and one-stop shops: “SMS has had the greatest reach but it’s probably the most unsexy form of advertising there is— as more and more consumers buy smart phones you can see the tide shifting… It’s not too late for his peer group to get in the game.”

Thet discusses the value of Butter, his acquisition strategy, and potential suitors in the video above.

Now that Apple has rolled out its very own mobile app advertising program, iAd –hey, better name than iPad, at least –and Verizon is making a rival tablet, the advertising industry is poised for disruption. Whoever can best use geo-local data to deliver realtime relevancy will make advertisers very happy. Ads will get more interesting and interactive on elegant devices.

And that’s just the tip of the iceberg.  Big ad budgets are moving online, where brands are trying to figure out how to make display ads work for them the way search ads work for direct marketers.  There is a whole array of new targeting techniques, not to mention social marketing campaigns that build buzz across YouTube, Facebook, Twitter, and beyond.  It’s all very confusing.  So we’re assembling some of the smartest people we know in advertising to discuss these changes at Disrupt, our technology and media conference taking place May 24-26 in NYC.

They include Samir Arora, the CEO of the giant women’s ad-network and publisher Glam Media and Zaw Thet, CEO of SMS-advertising firm 4INFO, which counts as clients media properties like NBC, Moviefone and MySpace. Brian O’Kelley is CEO of AppNexus, which debuted its realtime advertising platform this year.  He helped shape Right Media’s technology, leading up to an $850 million acquisition by Yahoo in 2007. Eric Wheeler, CEO of 33Across, was helping Ogilvy march into a Brave New World in digital advertising before founding his online social-graph marketing firm.  From publisher to mobile marketer to technologist to ex-Mad Man, this line-up will offer insight on the best ways to continue reaching the right audience—and the technologies that will come to dominate the markets.

Disrupt’s early-bird price expires tomorrow. Get tickets here. Or, learn more about exhibiting as either an early-stage startup –special pricing — or a big man on campus here. And check out our amazing speaker lineup.

And then there’s Twitter’s roll-out of new ad programs and Facebook’s continual expansion to creating one gigantic social graph. Not to mention  the changing market dynamics  of how inventory moves on exchanges vs. networks, demand-driven networks and auctions, and the FCC’s ongoing inquiry into privacy and behavioral targeting. We want to hear what ad-tech entrepreneurs have to say. And we want to hear what you have to say, too. We’re pulling the audience onstage for some of the conference.  Will you be there?

Finally, calling all Web developers: check out our pre-event Hack Day, a gonzo overnight marathon of creativity and building products. Mashery just signed on to present an API workshop, as did SimpleGeo. Hack Day sponsor Facebook and Disrupt sponsor Yahoo will also be offering workshops. Google‘s Don Dodge will help us pick a winner on Sunday.

Image courtesy Flickr/betta design. Eric Wheeler image courtesy 33Across.

Samir Arora
Founder, Glam Media
Samir Arora helped found Glam Media as a better way for premium brand advertisers to connect with audiences online. Under his leadership, Glam Media has grown from a tiny startup with a reach of 100,000 monthly unique visitors, a network of 12 publishers and its owned and operated site Glam.com, to become the #1 online environment for women and one of the Top 10 Media Companies in the US, with over 80 Million unique visitors a month. A technology industry veteran, Arora is a serial entrepreneur who was at Apple Computer in its early years and was CEO of NetObjects, where he drove the creation of the first website-building product, NetObjects Fusion. Arora also currently serves as chairman of Information Capital LLC, a venture-capital fund that invests in leading-edge “big idea companies” in consumer publishing, media, and technology.

Brian O’Kelley
CEO, AppNexus
Brian O’Kelley is the CEO and Co-founder of AppNexus, an advanced ad platform specializing in real-time advertising. Widely considered a visionary in the field of online media, Brian created the first successful ad exchange as CTO of Right Media (acquired by Yahoo for $850MM in July 2007). Prior to Right Media, Brian was CEO of Netamorphosis, an early social networking and e-commerce site for events and venues. Brian was also an early innovator in real-time personalization and real-time ad optimization at LogicSpan, a consulting and technology integration firm, and later co-founded Cetova, a web-based reporting and analytics platform for enterprise financial systems. While earning a computer science degree at Princeton University, Brian started a web design firm, building an open-source e-commerce engine used by more than 100 companies. Brian is an active partner at Grape Arbor, an angel investor group. Since its founding in 2006, Grape Arbor LLC has made investments into more than a dozen technology companies.




Zaw Thet
CEO & Co-founder, 4INFO
As the CEO and co-founder of 4INFO, Zaw Thet is helping to set the bar for how brands reach and engage consumers with content on their mobile devices. A veteran of the software/wireless industry, Zaw has a successful track record for leading companies to outstanding growth and performance. Prior to 4INFO, Zaw was part of the early social networking industry, as a Director at Spoke Software. Zaw also did a short stint at IBM, was the co-founder and CEO of GetInventory, a web-based supply chain management company, and was a special consultant to the San Francisco 49ers. Zaw has been a featured speaker within the mobile and interactive advertising industry, recently appearing at iMedia Brand Summit, and the Mobile Media Investor Conference. Zaw has an MBA from the Stanford Graduate School of Business, where he was a Soros Fellow.


Eric Wheeler
CEO, 33Across
Eric Wheeler is CEO of 33Acroos. Prior, Eric was the CEO of Neo@Ogilvy and Executive Director of Ogilvy Interactive North America. Under his leadership, Ogilvy Interactive’s revenue grew five-fold from 2003-2007 working with leading brands including IBM, American Express, TD Ameritrade, Cisco and Yahoo!. Eric was co-founder and President/COO of Lot21, the award-winning digital agency that sold to Carat in 2002. Eric’s 18-year career includes leadership positions at CNET, Young & Rubicam and Anderson Lembke in San Francisco. Eric holds a B.A. in Political Science and Philosophy from Boston University.

I interviewed CEO Zaw Thet in February to better understand the 4INFO business. 4INFO offers customers a publishing platform, which is tools to manage SMS subscribers and send them content. They also run an ad network for SMS ads, and a SMS gateway to handle the carrier relationships and charges. 4INFO’s larger publishers pay as much as $15,000 per month to use the platform. Those publishers can run their own ads, or use 4INFO’s ads with a revenue split (self service customers have no choice but to accept 4INFO’s ads).

At the time of the interview, just three months ago, 4INFO was sending about 200 million text messages per month. That will be 500 million/month by June, Thet tells me, based on growth from new publisher products and international expansion. And that doesn’t include traffic from mobile display ads, a new product 4INFO launched in December 2009.

The company has hired two new senior executive to help handle the growth, says Thet. Julie Shumaker has joined as Senior Vice President of Sales and Marketing, and Rob DeMillo, who is also currently the CTO of Revision3 (he will become a technical advisor to Revision3).

Thet says that DeMillo and Shumaker signal 4INFO’s intention to be more than the “King of SMS” (as I labelled them). “DeMillo is clearly all things mobile advertising (Third Screen Media, mQube, Transpera run the gambit from mobile display to messaging to video) not just SMS, and Shumaker is a digital advertising pioneer, as the first to launch games as an advertising vehicle at EA,” says Thet.

The FTC is looking very hard at the deal, and some consumer groups have lobbied the FTC to block it. Despite the fact that Apple acquired AdMob’s closest rival, Quattro Wireless.

But at least one of AdMob’s competitors, 4INFO, is supporting the deal (see our recent interview with 4INFO CEO Zaw Thet here).

In a letter to the FTC, Thet says “I have no concerns about my ability to compete effectively after the transaction closes,” and “this is such a rapidly growing and evolving industry that I have no concers about Google and AdMob dominating the space.”

I’ll say this – somebody just earned a ton of credit with Google. The letter is below:

4INFO, Inc.
177 Bovet Road STE 400
San Mateo CA 94402
March 31, 2010

BY HAND DELIVERY

Randall Long, Esq.
Federal Trade Commission
Bureau of Competition – Mergers I
601 New Jersey Avenue, NW
Washington, DC 20580
Re: Google’s acquisition of AdMob

Dear Mr. Long:

I am writing in support of Google’s acquisition of AdMob. I am the CEO of 4INFO, the largest SMS publishing platform and advertising network in the United States. We support multiple SMS advertising units, including click-to-WAP, call, video, and others. We also help advertisers create destinations for mobile users who respond to mobile advertisements, including mobile websites, mobile videos, white-labeled SMS content, and interactive SMS voting or polling. We also enable publishers of user-solicited SMS mobile content to monetize their inventory with SMS advertisements. Our mobile ad network includes top television, print and online content publishers, including NBC, Yahoo, AOL, The Weather Channel, CBS Sports, and TV Guide. We compete with AdMob, Google, and other companies active in the mobile advertising space including clients such as P&G, Ford, Land Rover, and many more.

I am supportive of the Google/AdMob transaction because there are plenty of alternatives for monetization in the mobile advertising marketplace. I have no concerns about my ability to continue to compete effectively after the transaction closes. I believe it will continue to be easy for me to partner with large brand advertisers who wish to advertise on mobile devices and publishers who wish to monetize their mobile content.

This is such a rapidly growing and evolving industry that I have no concerns about Google and AdMob dominating this space. To the contrary, I believe that the recent interest in mobile advertising – especially from investors – will make it even easier for new companies to enter into mobile advertising with innovative products and services that compete effectively. I believe that the Google/AdMob transaction will also help raise awareness of mobile advertising generally and encourage more advertisers to engage in mobile advertising campaigns.

If you have any questions, please feel free to contact me at XXX@4info.net or 650-350-XXXX.

Sincerely,

Zaw Thet

Zaw Thet | CEO | 4INFO, Inc.

When Google bought mobile ad network AdMob for $750 million in November 2009, 4IFNO CEO Zaw Thet said that he received a couple of phone calls from investment bankers and potential buyers who where were sniffing around the space. When Apple bought Quattro Wireless for $275 million two months later, he says his phone started to ring off the hook.

Why? Because 4INFO is usually described as the AdMob of SMS advertising. That isn’t a very good description of the company, but it’s enough to make everyone think that the company is next in line to close a big acquisition. And that last part just may be true.

The company, which has raised around $40 million in venture capital, is where companies go when they want to create a “mailing list” of SMS subscribers. For example – when Zynga began testing SMS notifications in December, they turned to 4INFO to power the product. 4INFO has 250 premier publishers, plus a couple of thousand more that use its self service platform.

4INFO offers customers a publishing platform, which is tools to manage SMS subscribers and send them content. They also run an ad network for SMS ads, and a SMS gateway to handle the carrier relationships and charges. 4INFO’s larger publishers pay as much as $15,000 per month to use the platform. Those publishers can run their own ads, or use 4INFO’s ads with a revenue split (self service customers have no choice but to accept 4INFO’s ads).

4INFO has 50 million U.S. phone numbers stored on behalf of publishers. And they are beginning to roll out an international product as well.

I sat met with Thet last week to see the company’s San Mateo offices and talk about the 4INFO business. He answered all of my questions, and even said the right thing at the end when I asked who’d be acquiring him. “We’re building an independent company,” he said. Which is exactly what everyone says right before they get bought.

4INFO is the sixth Peacock Equity investment since the $250 million fund was established in April.

Under the deal, 4INFO will become NBC Universal’s preferred mobile SMS advertising partner, providing technology and services that will enable NBC Universal “to offer dynamic, targeted advertising in its text messaging content.” NBC Universal will also be able to supplement its own alerts content offerings with 4INFO consumer services such as health tips, fantasy sports player statistics and custom, user-defined alerts.

San Mateo based 4INFO was founded in 2004 and includes amongst its investors Draper Fisher Jurvetson, Gannett Company, Sand Hill Capital and U.S. Venture Partners. The Peacock Equity investment is 4INFO’s 5th round, with the company having taken $8 million Series C in March 2005 and $10 million Series D in June this year. The amount of Peacock Equity’s investment was not disclosed.

“We’re proud to have the opportunity to build on our relationship with Gannett, a visionary company that is leading traditional media’s expansion into the mobile sphere,” said 4INFO CEO Zaw Thet. “Gannett’s support enables 4INFO to continue to advance our business of providing useful, timely information to consumers via their mobile phones and marketers with a unique way to reach an engaged mobile audience.”

As a provider of SMS based mobile search and alter services, 4INFO offers free access to real-time sports scores, 411, stock quotes, weather updates, horoscopes and other content. The SMS Publishing Platform allows print and online publishers to mobilize their content.

4INFO