Mobile Ad Network InMobi Raises $200M From Softbank

Bengaluru-based mobile ad network InMobi has raised $200 million from Softbank Corp, a Japanese telco.

The funding will happen in two tranches - $100 million in September 2011, followed by another $100 million in April 2012. Softbank has invested the sum in InMobi Pte and this latest investment is one of the largest in the mobile Internet space till date.

InMobi has raised a total of $15.6 million in three rounds of funding from marquee venture capital firms Kleiner Perkins Caufield & Byers and Sherpalo Ventures. In 2007, it raised $500,000, followed by $7.1 million in 2008 and $8 million in series B funding last year. Now, InMobi reaches 340 million consumers through 47 billion monthly advertisement impressions and has offices in Singapore, Bangalore, Tokyo, London, San Francisco and Nairobi. InMobi has a presence in 165 countries and claims to have overtaken Google's AdMob in the Asia-Pacific and Africa as the top ad network.

The funds will help InMobi scale up its recently launched mobile payments service SmartPay and the Sprout acquisition that was announced last month.

SmartPay is aimed at application developers and helps them handle regulatory complexity, fraud detection, tax issues, currency conversion, payment settlements and customer support across countries. InMobi has plans to reach three billion users in 30 countries by the end of the year with SmartPay. Sprout is a US-based mobile advertising solutions provider that enables advertisers to create (HTML5-based) rich media ads for mobile devices. Sprout pulled in brands such as Nokia, Disney, HTC, Chevrolet, Paramount Pictures and Sega.

InMobi will also look at more acquisitions, according to Naveen Tewari, founder and CEO of InMobi. "With Softbank behind us, we are now well positioned to fully capitalise on the opportunity before us through substantially increased product innovation, deeper market penetration and acquisitions across the mobile ad value chain," said Tewari.

The investment could also allow InMobi to pull ahead of competitors globally by leveraging synergies with Softbank's other portfolio companies. Over the years, Softbank has invested in Asian forays of large Internet companies, such as Alibaba, Zynga and Ustream. In April 2008, it set up Alibaba.com Japan as a joint venture and invested in Oak Pacific Interactive (Renren Inc.), which runs the Chinese social networking site RenRen.com. In 2010, it set up Ustream Asia for the video streaming company Ustream, Inc. and formed a joint venture with online gaming behemoth Zynga Game Network Inc for Zynga Japan in July 2010.

Softbank is Japan's third largest telco and recently announced it would exit Yahoo! Inc and sell its 4 per cent stake. Masayoshi Son, chairman and CEO of Softbank, said, "I hope the partnership with InMobi, a fast-growing start-up with significant mobile expertise and an outstanding technology platform, will further accelerate the pace of development in the mobile Internet space globally."

In India, InMobi continues to partner with media and entertainment companies. It recently tied up with NDTV Convergence, the digital arm of the media house NDTV, to deliver mobile ads on the latter's mobile applications.

Ram Shriram, founder of Sherpalo Ventures said, "InMobi joins a select set of companies globally which have achieved massive scale in a short period of time. This investment is a strong validation of the mobile opportunity across the globe and InMobi's ability to exploit its full potential. Mobile and smartphones are changing the world for consumers, businesses, advertisers and publishers."

Recently, Naveen Tewari, along with Blume Ventures, invested Rs.1.21 crore ($270,000) in Bangalore-based RupeeStreet Financial Services Pvt Ltd, which runs the website Moneysights.com. Tewari is also on the board of the international standards body Mobile Marketing Association. Read his interview on Techcircle.in, detailing the current mobile advertising scenario, challenges faced, ROI on mobile advertisements and the upcoming opportunities.