AdEspresso, a startup offering Facebook ad tools for small and medium businesses, is announcing that it has raised its first outside funding, a seed round of $500,000.
The company focuses on ad optimization, namely finding the most effective combination of text and images for your ads. It says that customers upload possible images and text for the ads, then AdEspresso will test out different combinations and track the performance based on metrics like clicks, leads, and sales. For example, the company says it could tell an advertiser, “This picture for Female from 18 to 24 is performing 40% worst than your campaign’s average. Stop displaying it now!”
The idea of testing and optimizing different ad “creative” isn’t new, but CEO Massimo Chieruzzi said there aren’t many companies offering a product targeted at SMBs advertising on Facebook. Similarly, he acknowledged that there are plenty of social ad companies out there, but he said most of them aren’t really direct competitors (he mentioned Qwaya as one).
AdEspresso spun out of an Italian ad agency but has moved to Silicon Valley to participate in the 500 Startups incubator. The company says it spent about a year developing the product before launching an open beta six months ago, and it’s on-track to sign up 5,000 advertisers by the end of 2013, with nearly $900,000 in ad spending managed so far.
While there’s still more work to be done on the product, the biggest item on the AdEspresso to-do list is probably making money — Chieruzzi said he’ll be implementing a business model that charges customers between $49 and $299 a month based on ad spending (customers can also use the product for free if they spend less than $2,000 a month). He also said that while AdEspresso is now headquartered in Mountain View, he plans to keep the technical team in Italy.
The funding, meanwhile, came from 500 Startups, Atlantic Capital Partners, and various angel investors including Richard Chen and Armando Biondi.