Along with the funding, Widgetbox is rebranding itself as Flite. Since 2006, Widgetbox has built a name for itself by creating web widgets to aggregate content and increase engagement. The company then began building and distributing mobile web apps for the iPhone and Android.

And Widgetbox launched ClickTurn, which allows publishers to easily create dynamic ads with multiple tabs that include content from YouTube, Twitter and Facebook streams. Now, Widgetbox is rebranding as Flite, emphasizing the focus on the company’s rich-media ad platform.

Flite provides brands and publishers with a ad-serving and creation platform for rich-media advertisements. The platform allows advertisers and publishers to deliver real-time, interactive display ads, which CEO Will Price likens to the iAd format. Price says that Flite’s ads are focused on engaging users with rich-media formats

Specifically, Flite’s tools create rich media ads with little to no technical knowledge, allows users to dynamically update campaigns in realtime, integrates third-party data into ads, and incorporates social content into ads. Flite’s ad formats are also compatible with mobile devices such as the iPad, iPhone, and Android.

More than one hundred and twenty leading brands have used the Flite platform to deliver
their brand experiences across the Web. Flite, which faces competition from Google’s DoubleClick platform, has helped serve twenty-five billion units with more than one hundred and twenty million monthly uniques, and fifty-five million unique daily events captured by Flite’s metrics system. Flite’s publishing partners include LinkedIn, Forbes, Yahoo, CBS Interactive, TechCrunch and brands like Microsoft, L’Oreal, Charles Schwab and Toyota.

Flite is probably wise to transition the focus of its business to its ad-serving platform. While $1 billion of the $7.4 billion display ad market involves rich media ads, this sector is rapidly growing. Advertisers are demanding a more customized feel to campaigns and are expecting a higher audience engagement as rich media ads evolve.

The funding will be used for product development and to hire additional staff.

Sometimes you don’t need to spend weeks building the sleekest mobile apps for native environments. And depending on your business, something a little bit more quick and simple can do the job just fine. That’s the theory behind Widgetbox Mobile, a new offering from the team behind ClickTurn ads, which aims to help businesses build mobile web apps in minutes.

“There’s a new category of users who view the app store as not the best option for them,” says Widgetbox’s CEO Will Price. In the same way that ClickTurn was created to allow startups to easily create dynamic, rich media ads in half an hour, Widgetbox is trying to compress the typically long development process for mobile apps.

Widgetbox offers a web-based do-it-yourself platform that will let you build HTML5 apps. Through the client you can  customize your app with images, icons and skins, add social media buttons and streams, create a splash page, change fonts and include special features, such as slideshows and interactive polls.

As you’re building your app, you can preview it, to see how it will function as a live app. If the default customization tools are not sufficient, users can also drop their own HTML code— but code is not required to get the app from ground to launch.

The price to build and maintain your Widgetbox Mobile app ranges from $25 to $50 per month, depending on the premium features you need. That adds up over time, but it’s still dramatically less than the approximate cost of building your own app from scratch.

There are also certain obvious advantages to using a self-service platform like Widgetbox Mobile— no wait for app store approval and the ability to instantly deploy updates. Of course, for the sake of efficiency and convenience, you also lose the richness often found in native mobile apps and the deep sense of customization.

Price says users can expect the Widgetbox Mobile to continue to evolve and introduce new layers of customization in the near future, which will hopefully bridge that gap.

Another important drawback to note is the lack of convenience surrounding the ad system, you can easily run Admob ads in your Widgetbox Mobile space but if you want to run your company’s custom ads you will have to reach out to Widgetbox directly and try to work with their team to make it happen (Price says this will eventually become a self-service option as well).

Although Price doesn’t believe that Widgetbox will completely upend the market and render native apps obsolete, he believes that many businesses, of all sizes, will find his service useful. For example, even though a large corporation will likely have their own team of developers working on their main mobile application, WidgetBox could help them build ephemeral apps that are designed to work for a short period of time, like for conferences or limited events.

Beyond Widgetbox Mobile, the marketplace for services that quickly help users build mobile apps is certainly growing— Widgetbox’s competitors include Mobify, which pulls elements from your existing website, iBuildApps and appMobi, which caters to the iPhone and Android platforms.

The momentum in online advertising is shifting away from traditional static text ads and towards rich media ads that are highly customized and interactive. Unfortunately, they generally take a lot more effort to create, which puts them out of reach for some companies.  Enter Widgetbox‘s ClickTurn ad-builder. ClickTurn gives publishers a relatively fast and easy way to create dynamic ads with multiple tabs that include content from YouTube, Twitter and Facebook streams. Think of it as a mini site-within-a site where advertisers can showcase their best content and social media feeds.

ClickTurn has delivered over 100 million impressions so far, collecting a $1.50 CPM. Not too shabby, when you consider that ClickTurn launched in December and has 12 clients under contract (including CBS, IDG, Linkedin).

For publishers, why bother? Publishers want advertisers, advertisers want eyeballs, rich media ads attract more eyeballs. For comparison, the traditional display ad will see a 0.13% click-through rate and a 2% engagement rate (i.e. when a cursor floats over the ad), according to Widgetbox CEO, Will Price. Meanwhile, ClickTurn’s ads enjoy a 0.8% click-through rate with a 20-25% engagement rate.

There are other companies in this space like EyeWonder, Point Roll and Eyeblaster. Price says the rich ad process typically requires a flash developer and 4-6 weeks on average— making it a costly and labor intensive endeavor. Price says that anyone that can navigate Facebook can create an ad with ClickTurn’s template in half an hour. Using ClickTurn’s form, a user can pick custom backgrounds, select a size, add animation and create tabs with social media streams or other information/multimedia. There’s also an option to add a companion mobile ad (publishers can include an input field at the foot of their ad for user cell phone numbers). When a user enters his number, the ad sends a link via text message that will open a complementary mobile ad that uses HTML5 to present a more dynamic experience.

The rich media ad industry is still relatively small. Of the web’s $7.4 billion display ad market, just $1 billion is rich media. But it’s rapidly expanding as advertisers demand a more customized feel and higher audience engagement. And it’s about more than just clicks. The real value of a rich media ad is hidden in the treasure trove of user data. While a typical display ad can tell you the number of impressions, a service like ClickTurn can tell you how a user is interacting with your ad and which tabs/services are most popular (i.e. if users prefer your Facebook or YouTube stream). It’s a window into your consumer, their online habits and a way to gauge the success of your social media strategy.

Widgets were all the rage last year. And the trend seems to be growing. Widgetbox, a widget creation and distribution platform, is reporting 500 million impressions worldwide in the past month, according to Quantcast. Widgetbox says that the vast majority of activity exists across hundreds of thousands of publishers who embed the widgets in blogs each month and through partners who integrate Widgetbox’s widget galleries.

That being said, Widgetbox is still behind other widget makers in the space, including competitor RockYou, which had 9.5 billion impressions in the past month, according to Quantcast. Clearspring also seems to have more of a reach than Widgetbox, but we don’t have the comparable Quantcast numbers. Clearspring’s widgets had 520 million unique visitors in April of 2009, according to comScore.

We also received these comScore numbers of uniques for April 2009 for most of the widget producing platforms:

Widgetbox, provides tools for both novice and advanced developers to create a variety of widgets, from simple embeddable RSS feed readers (called “blidgets”) to full social network applications for Facebook, Bebo, MySpace and others. Although Facebook represents only 1% of the widget maker’s traffic, Widgetbox says that they are specifically targeting Facebook as a growing priority, recently launching Facebook Connect integration for users and widgets (which can be published in the Facebook feed). Perhaps this is because of Facebook’s steady growth in the U.S. and its popularity abroad.

Last fall, Widgetbox launched a blog network. To be part of the network, a blog owner needs to embed one of the 29 channel-specific widgets created by Widgetbox. Each widget displays the same leaderboard content as the Widgetbox homepage, which allows users to browse through a network’s top blogs without having to frequently return to the Widgetbox site. The majority of Widgetbox’s impressions come from blogging platforms Blogger and WordPress, with a fair amount of traffic also coming from Bebo and MySpace.

While Widgetbox is seeing success as a startup, it is competing in a crowded space of other more popular widget makers, including Rockyou, Clearspring, and Slide.

if (WIDGETBOX) WIDGETBOX.renderWidget(’21226dae-c512-4e30-865a-d975b1e15df1′);Get the The TechCrunch Network Widget widget and many other great free widgets at Widgetbox!

Widgetbox, one of the web’s largest widget creation and distribution platforms, is launching a new blog network and becoming a destination site in the process.

Widgetbox’s homepage will now feature 29 blog channels ranging from parenting to technology. Each channel will include a lists of the most active stories in the network, as well as a leaderboard rewarding the most prolific and popular writers. Leaderboards use a normalized acceleration algorithm to ensure that content from both large and smaller blogs will appear regularly.

To become part of the blog network, a blog owner will need to embed one of the 29 channel-specific widgets created by Widgetbox. Each widget will display the same leaderboard content as the Widgetbox homepage, which allows users to browse through a network’s top blogs without having to frequently return to the Widgetbox site. The company hopes that this will give member blogs an increase in traffic, while giving them an incentive to produce high quality material so that they might reap the benefits of appearing on the leaderboard.

Up until this point, Widgetbox has been primarily involved with creating and distributing widgets across a wide range of social networks and blogs. The site claims an impressive 462 million monthly widget impressions, a large portion of which is driven by very popular mini-RSS feeds the site calls “blidgets”.

Widgetbox may initially have some trouble driving members to join their new blog network – there are already a number of well established networks that could conceivably drive more traffic. But if the site can leverage the massive userbase held by its widgets (perhaps using unobtrusive system wide messages), it could see very rapid growth.

Widgetbox is jumping on the iPhone bandwagon by releasing a special gallery of widgets tailored to the popular device’s screen.

There are 16 widgets available to start, including an RSS output of The Secret Diary of Steve Jobs and a BART QuickPlanner tool for finding mass transport rides around the Bay Area. A tutorial is being provided for developers to create their own iPhone-ready widgets, which will then go into the gallery.

Despite Jobs’ insistence that all regular websites work well on the iPhone, it’s always nice to see websites tailored for the device because when it comes down to it, pinching to zoom in and out gets tiresome. This new gallery is especially nice because mobile users generally want access to quick information while on the go, and widgets are inherently designed for small bits of consumption. If you find a few widgets you like, you can add them to your home screen for easy access.

Also see Apple’s own gallery for iPhone-ready web apps.

The company has raised $14.5 million from Hummer Winblad, Sequoia Capital and Northgate Capital. Hummer Winblad has been around since 1989 and has invested $620 million of so in startups. Price feels that Widgetbox is poised to take advantage of the huge surge in widget usage. And if the AOL acquisition of Goowy and the recent Slide valuation is any indication, there’s lots of room to grow for Widgetbox.

I asked Price to write a guest post telling us why he made the decision to leave a very safe and very lucrative job and enter the very unsafe and risky world of startups again. His post is below, although it can largely be summed up in this post, too. If you want to follow Price’s regular updates, his blog is here.

My name is Will Price and until yesterday I served as a General Partner at Hummer Winblad Venture Partners, an early stage venture capital firm that was founded in 1989 (investments include TheKnot, Napster, HubPages, Omniture, Powersoft, Hyperion and others). While passionate about the firm and the venture industry, I am leaving Hummer Winblad today to take the CEO role at one of the startups I invested in – Widgetbox.

Michael Arrington kindly offered me the chance to explain my decision to leave venture capital and to join Widgetbox as the CEO. While the detail follows, in summary the combination of my personal aspirations to return to an operating role and my passion for the widget market and the company (which I helped seed fund) made this a no-brainer move for me.

My logic:

The best markets and the best companies ride the tide of history. Widgets are such a market.

The Web’s tide is open, distributed, standard, user-defined, and, in many ways, the most powerful force of the modern era. Widgets are not a fad, or web 2.0-hype, but fundamentally they are the unit by which users are assembling and defining their web experience.

Widgets are portable applications that are user-defined, user-assembled, and consumed independent of the source of the underlying content, commerce, and application functionality. The combination of user-control and decentralized interaction to important services represents an important paradigm shift in how users discover, select, and consume the best of the web.

In Nov 2007, Comscore reported that 650m global uniques, or 65% of the web universe, interacted with a widget. The growth in widget adoption and social media speaks to users’ unmet needs and frustrations with traditional web models. Today, brands, developers, media companies, and established Internet players are racing to understand the forces driving user behavior and the power of a more componentized and distributed web. While widget penetration is at 65% of Internet users and growing, spend in the widget category in 2007 was less than $20m, or 0.1% of the total online ad spend
market.

The 650x differential between spend and the record growth in user adoption is very powerful to consider. Users are always ahead of the market, as evidenced by the systemic under-allocation of ad dollars on-line; 21% of media consumption is on-line vs. 7% of ad spend. However, this 3:1 imbalance is steadily eroding and the widget market will prove to be no different and no less transformative. Traditional portal models that aggregate users and resell that aggregation are fundamentally at odds with the emerging paradigm of user and community defined experience and distributed consumption.

Marketers need to fish where the fish are, however, in an early market there are often more questions than answers. While widgets are enjoying end-user success, the commercial relevance of widgets remains unclear to many. Are widgets a new marketing channel? If so, are they effective? How do you build them, buy them, track them? What is the unit of value; an impression, an install, an engagement…? What type of ecosystem will form around the phenomena? In order to move beyond fad status, an economic model for the widget ecosystem needs to be better developed and measurable value delivered to both end-users and marketers.

Widgetbox, along with Slide, Rockyou, Goowy, Clearspring, Gigya, and others, is working to enable users, developers, brands, media houses, and incumbents to ride the tidal wave of web componentization.

Widgetbox, backed by Hummer Winblad, Sequoia Capital, Northgate Capital, and Michael Dearing, is the web’s largest gallery of widgets. Widgetbox’s growth in the past year has been extraordinary, with a current monthly audience of 30m uniques, 400m monthly widgetviews, and widgets installed across 230,000 domains.

For those of you who read my blog, you know that I am passionate about the venture capital industry and its importance in supporting innovation and entrepreneurship. As a General Partner at Hummer Winblad, I enjoyed the exposure and access to some of the key innovators and drivers of the new economy; company’s like Omniture, Move Networks, Mulesource, Widgetbox, and many others. At 36, however, I felt a persisting and important pull to embark on a new journey of growth, discovery, and learning.

In my career to date, I have found that if you follow your heart, work tirelessly, and fish in good waters, good things will happen. For Widgetbox and our colleagues in the space, good things will continue to happen if we stay true to the web’s architecture of openness, distribution, and standardization and to users’ passion for empowerment, expression, and need for community.

Their first product was a Flash-based webtop or alternative operating system. But later they went into the widget space with their YourMinis product, and that is the reason AOL has acquired them.

AOL SVP of Social Media, Messaging and Homepages David Liu said this was a deal they’ve been considering for the last nine months, and that they plan to integrate Goowy’s technology into both user-facing AOL products (to widgetize them) as well as their Platform A advertising network. Expect Platform A to launch significant new advertising products in the widget space soon, Liu says.

This is a significant win for Goowy founder and CEO Alex Bard, who has run a tight operation over the years. The company has just six employees and raised a single round of financing from Mark Cuban in April 2006 (the size of that round remains undisclosed, but it was almost certainly under $1 million). He says the Goowy team will remain in San Diego for at least the short term.

Goowy competes with a number of startups in the widget advertising space, including Widgetbox, ClearSpring and Gigya. VideoEgg, Slide and RockYou also compete in this area.

AOL has been busy acquiring promising young startups – they bought Israel-based Yedda last November as well.

Widgetbox, a platform for the creation and distribution of web widgets, has raised $8M in a Series B round of financing led by Northgate Capital and joined by Sequoia Capital and Hummer Winblad.

The company provides tools for both novice and advanced developers to create a variety of widgets, from simple embeddable RSS feed readers (called “blidgets”) to full social network applications for Facebook and Bebo. I first met the WidgetBox team at Bebo’s platform launch event, as it had helped create at least one of the applications that launched there. Out of the 956 applications now available on Bebo, 60% have been created using Widgetbox’s “app accelerator” tool. The company also claims that 15% of the applications on Facebook have been created using its tools.

Since the widget business seems to be a lot about the numbers, here are some more: Widgetbox hosts almost 34,000 widgets in its gallery (the largest gallery on the web according to them) and these spread across over 210,000 domains and created by over 20,000 developers. Every day their widgets are viewed about 12M times. About half of Widgetbox’s advanced developers use Flash, whereas the other half use server-side languages like PHP or JSP. Widget usage on places like Blogger and MySpace is still very strong and growing. Expect to see even greater distribution when OpenSocial finally comes of age.

Widgetbox says that it will use its new funds to scale operations, promote further distribution of its widgets, and develop its monetization strategy and revenue share program. Currently, revenue is only being generated from Facebook applications that have opted in to putting ads on their canvas pages. Widgetbox will be working to create other opportunities for generating and sharing revenue with its developers, some of which will involve advertising and some which may not.

The new offering which MuseStorm is officially dubbing a “content engagement platform” provides four widget syndication aspects: Authoring, Distribution, Analytics & Monetization.

The highlight of the platform is the authoring functionality. First, it provides non-programmers the ability to develop rich media (audio, video, photo, text) widgets. Second, MuseStorm’s platform instantly exports the “source” into a variety of Web formats, including MySpace, Facebook, iGoogle, Netvibes, PageFlakes, etc. Desktop widget export currently features Windows executable, but support for Google, Yahoo, and Mac will be added in the near future. Updated are propagated seamlessly to the universe of deployed widgets, regardless of format.

The distribution aspect of the platform includes Web and Desktop widgets as noted above and will be expanded to IM and mobile. From the analytics standpoint, the MuseStorm platform provides distribution and user interaction analytics which should help publishers optimize their offerings. Publishers can monetize their widgets by integrating ads using advanced features such as event triggers, location of the ad within the widget, and more.

MuseStorm is targeting its offering toward high-end publishers requiring a complete widget strategy. This is in contrast to offerings by Widgetbox and Clearspring which are geared at publishers that are in need specifically of distribution power.

Several publishers have already given the nod to MuseStorm’s new platform. These include Simon & Schuster (BookVideos), CBS (The ShowBuzz), and even MicroSoft which launched a Halo 3 FaceBook app powered by MuseStorm.

Founded in 2005, MuseStorm is based in Sunnyvale with R&D in Or-Yehuda, Israel. Dr. Yossi Vardi provided seed funding in the low six digits. In July 2007 $1M in Series A was provided by Elron (NASDAQ: ELRN). This is Elron’s first Internet investment.

Amnesty Hypercube allows users to use web widgets, such as those provided by Google Gadgets, Pageflakes, Widgetbox and others on their desktop in a similar fashion to Apple’s Dashboard, Yahoo Widgets, Google Desktop and the Vista Sidebar.

The theory goes that there are “hundreds of thousands” of publicly available web widgets, flash games, and videos that are designed to run on the web; Amnesty Hypercube brings this choice and variety to the desktop.

Amnesty Hypercube includes a directory of over 150 web widget providers that can be browsed by category and explored from inside the application. Widgets from the directory can be imported automatically into Amnesty Hypercube via its “NoClick” technology.

Desktop widgets tend to be something people either love or hate. If you’re a serious desktop widget connoisseur and are stuck using something like Vista (which is a fairly dismal range of widgets) Amnesty Hypercube could well be for you. As a Mac user I don’t see the need quite as much, however using something like this does expand your widget options.

Amnesty Hypercube is available for both Windows and Mac, and is offered as freeware.

The Widgetbox Remote Gallery feature enables social networks to embed a select number of widgets from third party developers and provide access to the over 10,000 widgets from the Widgetbox main gallery, giving their users the ability to easily find and use widgets to customize their profiles, blogs and web pages.

Partners can brand their own Widgetbox Remote Gallery and have control over the widget selection in the Widgetbox Remote Gallery. Galleries can be as large or small as desired and widget selection can be rotated as needed.

Launch partners include Freewebs, imbee.com, Xanga and Six Apart’s TypePad, LiveJournal and Vox.

If you like widgets, there’s about to be a whole lot more of them available for use in your blog or profile page. If you’d like to develop widgets and have some one else deal with the details, this could be for you. If you’re unfamiliar with widgets, see the “community powered search” box on the right side of TechCrunch – that’s a widget. Videos, slide shows, music players and news tickers that can be dropped into web pages are common types of widgets.

PostApp is headed and B2B veterans Ed Anuff, Giles Goodwin and Dean Moses. The company debuted its first offering, an eBay widget, in partnership with Typepad at the end of March.

PostApp will manage the process of turning web services into widgets that bloggers, social network users and others can insert into their pages. Outside developers will create web services, submit them to PostApp for transforming into widgets and content publishers like bloggers, auction sellers and social network users will select the widgets they want from the WidgetBox marketplace. The service will also manage the money for widgets that involve financial transactions like affiliate links or subscription, though developers will have first say in determining the business rules of their projects. PostApp will act as a master affiliate or subscription center, as appropriate.

As the number of photo, video, eCommerce and calendar widgets available online proliferates I can’t help but think that a central place for lots of widgets sounds like a good idea. I also hope that this will make it easier for developers to create other kinds of widgets, as the choices out there can feel pretty stale.

One of the first highlighted widgets will use the Yahoo images API to insert contextually relevant images into any website. RSS will be the basis of many, but not all of the widgets. If you love RSS as much as I do, you can probably imagine almost any information being delivered by feed and thus displayed in a widget. If an interesting variety of feeds are widgetized and then mixed with intermittent contextual advertising – then everybody wins. I’ll eagerly await the widgets of the future.