With a recent public launch under its belt, OpenSky is adding $6 million in new capital. Existing investors Highland Capital and Canaan Partners invested in the series B financing. A year ago, the company raised $5 million.
OpenSky is a social marketing/e-commerce startup which connects manufacturers and distributors directly with influential bloggers who recommend their products and get a cut from resulting sales. It is much more than an affiliate network.
As I described OpenSky when it launched:
While OpenSky sounds at first like an affiliate network, it isn’t. Instead of sending customers off to other online stores, they send them to their own stores where they can track sales and follow up with personalized messages. OpenSky hand picks the publishers who are allowed to set up shops and sell in its network. It then strikes deals directly with manufacturers and distributors who agree to drop-ship any sold items to readers who click to buy through an OpenSky shop. Instead of the blogger getting a 3 to 10 percent affiliate fee, they split the net profits 50/50 with OpenSky. The economics work best obviously with high-margin products.
OpenSky CEO John Caplan was previously the CEO of Ford Models, and before that the president of About.com. He tells me that “seller conversion rates grow and repeat shoppers buy more frequently” since the launch (before that, OpenSky was in private beta with 250 bloggers). His plans going forward include hiring more people, releasing a distributed cart (for onsite shopping without sending readers off to a store), opening up OpenSky’s APIs, improve the relevance matching between product manufacturers and bloggers/influencers, and better direct marketing support for sellers.