October 14, 2010
Submitted by ChaCha
INDIANAPOLIS (October 14, 2010) ChaCha, the #1 free real-time answers service, has closed a $20 million round of financing from new investors VantagePoint Venture Partners and Rho Ventures.
“We are fortunate to have VantagePoint and Rho joining this round of funding, which will allow ChaCha to continue to expand its real-time, human-powered, free answers service. Our new investors clearly recognize the value of our business, which helps advertisers ‘get into the conversation’ with ChaCha users who frequently ask their ‘smart friend’ questions about anything and everything," says Scott Jones, ChaCha's CEO. "Our business delivers high value to both users and advertisers. It’s a compelling equation.”
ChaCha has answered nearly one billion questions in the past two years alone, having surpassed even Google in mobile text search, according to Nielsen. ChaCha is the industry leader in text-based advertising and has emerged as the single best place to reach the youth market in any medium. Between online Top 100 website, www.ChaCha.com, and mobile platforms, ChaCha reaches over 15 million unique users every month.
In the course of answering questions, ChaCha creates a clever dialog with its users, which ends with a marketer's call to action. Additionally, the company will soon deploy a new MMS service that will deliver movie trailers, other video, coupon images, and rich media ads to virtually all phones, not just smartphones.
Spending on SMS-related advertising programs alone is nearing $1 billion a year according to eMarketer. ChaCha has worked with some of the world's most prominent brand advertisers including Paramount Pictures, McDonald's, Palm, Coca-Cola, AT&T, J&J, P&G, Wal-Mart, Best Buy, The CW Network, and hundreds of others. The Company's year-to-date ad sales are up 292% and Q3 revenue is 302% of Q3 revenue in 2009. Over 70% of ChaCha's 2010 advertising campaigns to date are renewals.
"Scott and his team have done an extraordinary job of establishing ChaCha as the most important brand in free answers and mobile advertising," says Richard Harroch, Managing Director and Global Head of M&A at VantagePoint Venture Partners. "With the world shifting from desktops to mobile devices, ChaCha is well positioned to become the leader in mobile search because it provides real and useful answers.”
Mr. Harroch and Mark Leschly, a Managing Partner at Rho Ventures, will join ChaCha's Board of Directors.
Since inception five years ago, ChaCha has raised capital from prominent tech leaders, venture capitalists, and angels, including Jeff Bezos, Morton Meyerson (leader of EDS and Perot Systems), Rod Canion (the creator of the portable computer industry), Jack Gill (co-founder of Vanguard Ventures), Don Aquilano (MP of Gazelle TechVentures), members of the Simon Mall family, and others.
VantagePoint Venture Partners (www.vpvp.com) is a global leader in funding the transformative companies of the 21st century in the Information Technology, CleanTech, and Healthcare sectors. With a best-in-class investment team of business and scientific experts, a broad network of corporate Strategic Partners, accomplished Senior Advisors, and more than $4.5 billion in committed capital, the Firm has the resources and talent to build important, industry-leading companies. Headquartered in Silicon Valley with offices in Hong Kong and Beijing, VantagePoint has investments in over 70 other companies, including Allocade, Bridgelux, BrightSource Energy, Conceptus, IntelePeer, LiveScribe, Neuraltus Pharmaceuticals, Serious Materials, and Solazyme.
Rho Ventures (www.rho.com) has a multi-stage investing strategy focused on high-growth companies in large markets. Rho Ventures' investments span new media, healthcare, IT and energy technology. Rho Ventures brings nearly 30 years of venture experience, combined with its partners' deep sector expertise and its far-reaching network to assist each portfolio company. This approach has allowed Rho to participate in the growth of some of today's most innovative and successful companies, including Ciena, Capstone Turbine, Compaq Computer, Gloucester Pharmaceuticals, Human Genome Sciences, iVillage, Intralinks, MedImmune, ReachLocal, Shire, Tacoda, Tripod, EveryDayHealth, Vicuron, and Yantra. Rho Ventures is currently investing from Rho Ventures VI, a $510 million fund. The firm has offices in New York City, Palo Alto and Montreal.
ChaCha (http://www.chacha.com) answers who, what, when, where and why, and has emerged as the No. 1 way for advertisers and marketers to engage teens and young adults. Through its unique "ask-a-smart-friend" platform, ChaCha has answered nearly one billion questions since launch from more than 15 million unique users per month via SMS text (242-242™), online (http://www.chacha.com), Twitter (@chacha), Facebook app, iPhone app, Android app, and voice (1-800-2-ChaCha™). Working with major brands such as Paramount, AT&T, Palm, Johnson&Johnson, P&G, Coca-Cola, McDonald's, Sonic, and presidential political campaigns, ChaCha.com is one of the fastest growing mobile and online publishers according to Nielsen and Quantcast.
ChaCha was co-founded by proven innovator and entrepreneur Scott Jones and is funded by VantagePoint Venture Partners, Rho Ventures, Bezos Expeditions; Morton Meyerson, former President and Vice Chairman of EDS as well as Chairman and CEO of Perot Systems; Rod Canion, founding CEO of Compaq Computer; the Simon family; and Jack Gill, Silicon Valley venture capitalist.
George H. Simpson