Dow Jones VentureWire, Ty McMahan  7/24/2009

The Internet continues to get flashier, with more video, widgets and social networking tools competing for attention, and companies providing those tools are looking for ways to dazzle the dollars from advertisers' pockets. Still, the bulk of Internet content is text.

It may not be as flashy as the newest contextually targeted, custom-skinned video widget, but Kontera Technologies Inc. still sees a lot of innovation and advertising dollars to be had in in-text campaigns.

The concept has the company's existing investors Carmel Ventures, Sequoia Capital and Tenaya Capital pledging a $15.5 million third round of financing. Sequoia led the round, which will be used to scale the business with new engineering hires and customer acquisition efforts. Chief Executive Yoav Shaham said the company has raised about $33 million to date. Valuation is undisclosed.

"This is a huge opportunity to build a new market for in-text advertising," Shaham said. "We're working with more large brands and publishers and pushing this concept. The fact is we have a deep technology that solves the problem of monetizing text on the Web."

Publishers working with Kontera include American Media Inc., Jupiter Media and Smart Money. On those sites, depending on the topic, users will find advertisers such as Microsoft Corp., Verizon Communications Inc., Symantec Corp., Hewlett-Packard Co., and Intel Corp.

Shaham said the profitable company has experienced 17 continuous quarters of double-digit revenue growth. He declined to provide specific figures. In May, data tracker Comscore announced that Kontera was the fifth-fastest-growing Internet advertising network, with a 40% increase in audience throughout the prior 12 months. Kontera now reaches more than 100 million monthly unique users, Shaham said.

Kontera's technology performs real-time semantic analysis of content and other information to hyperlink the terms that most accurately represent and predict user intent and engagement. The company has two separate engines of analysis that provide links for understanding the content and the end user. The company currently provides its technology to about 15,000 publishers.

Founded in 2003, Kontera has offices in San Francisco, New York, Los Angeles, Detroit, Chicago, Atlanta and Tel Aviv. The company has about 100 employees and expects to add about 40 more within a year.