Content recommendation service Zemanta has a new CEO, though he’s not new to the company — the new chief executive Todd Sawicki was already Zemanta’s president. Meanwhile the previous CEO, co-founder Bostjan Spetic, has become chief product officer.
Zemanta is also announcing that it has raised $2 million in new funding from Union Square Ventures and Social Starts.
Sawicki told me that the company has been undergoing a broader shift. Until this year, Zemanta was focused on providing tools for bloggers. In other words, when a Zemanta user was writing a blog post, the company would suggest related content that could be included in links. More recently, the team realized that the same technology could be used to suggest related content directly to readers and to make money by including sponsored content among those recommendations.
To that end, Zemanta has launched a “content discovery network,” and it also introduced related products like Streams, which offers an endless stream of related articles directly below a mobile article page (to see it in action, check out the mobile website of Zemanta partner — and my old employer — VentureBeat), as well as Circles, which are basically networks of trusted, related sites that can cross-promote their content.
“Zemanta’s Streams is one of the coolest products I have seen this year,” Union Square’s Fred Wilson said in the funding press release. “It can intelligently express what I believe will create an ideal online marketing environment – streams of contextual organic and promoted content that are natively assembled to drive engagement.”
The company’s business is currently split 50-50 between its editorial tools and its discovery network, Sawicki said, but he expects the discovery network to keep growing. The early results have been promising, with 600,000 publishers in the network, and with clickthroughs on mobile actually as high or higher than on desktop. So this is a model that should work as more and more online consumption moves to smartphones and tablets.
Before joining Zemanta, Sawicki was chief revenue officer at Cheezburger. He was brought on to build the discovery network, so it probably makes sense for him to lead the business as the network and its ad-based business model become more central. In addition, he said that Spetic was a bit of an “accidental” CEO, having taken over the role from his brother.
“He’s really a product guy at heart,” Sawicki said. Spetic’s new role is supposed to allow him to focus on maintaining the company’s “strong product direction.”
As for the funding, Sawicki acknowledged that it’s actually smaller than the $3 million that Zemanta raised in 2010, but he said that was intentional — the company has significant revenue and doesn’t need to raise more (and give up additional equity) at the moment.
“We don’t need to get a ton of money right now,” he said. “If we want more, there’s more available.”