JumpTap Banks $26M to Combat Google, Yahoo in Mobile Search, Advertising

If you didn't believe Google and Yahoo management when they cited mobile search and advertising as one of the fertile, green fields for making money from mobile Web use, you might want to rethink that position.

JumpTap, which has built a unique, two-headed business model by offering white-label mobile search and a mobile advertising network, has just banked more than $26 million in funding.

The investment is the company's biggest round to date, bringing JumpTap's total funding to $72 million. The D round was led by AllianceBernstein L.P. and included General Catalyst Partners, Summerhill Venture Partners, Redpoint Ventures, Valhalla Partners and WPP.

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JumpTap Chief Marketing Officer Paran Johar told me today the cash infusion will not only bolster the company's mobile search and advertising offerings but help the company grow its global ad sales and operations divisions to meet increased demand from advertisers. That's a sign that the market for mobile ads is hot.

JumpTap currently has 17 carriers that leverage its white-label mobile search engine, including AT&T, Boost, Virgin, AllTel, U.S. Cellular and Rogers. These carriers use the JumpTap search engine on the smart phones they offer to consumers without using the JumpTap brand.

This is in contrast to search deals Google has inked with Nokia, Sprint, Apple and soon Verizon, all of whom tout Google as their search engine. With Google's powerful brand, this makes sense.

But Johar also said that unlike "large ad swamps" from larger providers such as Google and Yahoo, JumpTap's mobile ad network features premium content; the company is the exclusive third-party ad provider for NBC Universal and Fox Mobile Entertainment.

"The key is developing targeting parameters for the mobile ad network, using multiple sources," Johar told me. "In the ideal scenario, the ad is so relevant, it becomes less of an ad and becomes content and much more of a value exchange."  

One of these parameters is of course the white-label search engine, where JumpTap leverages keyword data based on queries to target ads. Another is using attributes of carrier data on customers, including geographic, contextual demographic and behavioral information, to better match ads with customers.

Providers such as Medio and Japan's MCN offer white-label mobile search, while AdMob and Millenial offer mobile ads without the search engine and broad carrier networks. JumpTap's mobile search and mobile ad network, combined with its monetization platform and targeted ad parameters, is a nice distinction.

All this is well and good but JumpTap, Google, Yahoo, Microsoft, Medio and others still have to solve the challenge of advertising to users on the tiny third screen that fits on increasingly smaller gadgets that fit in users' hands. For one, there are obviously fewer ads per mobile screen; another is getting users to view and click on these ads.

Apple's iPhone may be the premier smart phone now, despite spotty 3G iPhone experiences, but that doesn't mean people will watch ads on them. Mobile ad providers need to continue to innovate on this front.

Still, JumpTap's funding round suggests the company is onto something. Indeed, JumpTap President and CEO Dan Olschwang said in a statement:

The closing of this round by these prestigious investors during a tight financial credit climate sends a strong and positive message about their confidence in the growth potential of mobile search and advertising and our ability to execute on our long-term vision. We are truly excited as to the value our new investor AllianceBernstein brings to the table.

We'll just have to see if JumpTap's excitement crosses over to advertisers and the consumers they hope to target.