Digital Media funding continued to decline, as in the previous quarter. Digital Media companies for the purposes of VentureDeal's definition are either video/casual game producers or advertising networks. Funding declined by 10% to $297 million among 32 companies.
Spot Runner secured $51 million during the quarter. The company is an Internet-based advertising agency that makes it easy for local businesses to advertise on television. Federated Media raised a $50 million venture capital financing round. Federated operates an online advertising network that aggregates blogging verticals to allow advertisers to market their products or services by blogging market segment.
A notable gaming funding during the quarter was for Turbine, a producer of online subscription entertainment and games, which received $40 million. Also, D2C Games secured a little over $1 million to assist it in providing its direct-to-consumer game publishing services for arcade sports and action games.
The eCommerce sector showed renewed activity, with 14 companies receiving a total of $93 million in venture funding, a roughly fivefold increase over activity in Q1.
Two companies received $20 million during the quarter, which represented 43% of the entire funding activity - MarketLive and Obopay. MarketLive provides a retail eCommerce solution specifically designed to meet the requirements of catalogers, direct marketers and brand manufacturers.
Obopay has created a cell phone based system that allows users to pay friends, get cash or otherwise have person-to-person transactions via its wireless networking system.
Also in the retailer space, Demandware raised a little over $9 million to fund its enterprise class eCommerce platform. The platform is sold as an application suite, which is billed on a usage-based pricing model.
During the quarter, Software fundings edged out Internet sector fundings by raising $1.3 billion allocated among 201 companies. This activity represented an increase of 3% in total funding amount and a 5% increase in the number of companies funded.
The largest funding of the quarter, $100 million for Rearden Commerce, was an expansion round funding. Rearden has developed a web-based personal assistant and related online platform that it says will revolutionize the way people and businesses buy and sell services.
In the financial services space, Yodlee secured $35 million to scale its online bill payment solutions and services. For many years, Yodlee has primarily been a financial account aggregation service sold to financial institutions. From this financing it appears it has changed its focus to be more of a consumer bill payment play.
Cloud computing company rPath garnered $10 million in its series C venture capital round. Raleigh, North Carolina-based rPath has created Linux platform appliances that assist application developers in transitioning their technology to on-demand solutions.
In the virtualization space, DataCore Software received $30 million for sales and marketing expansion. DataCore provides storage virtualization SAN software applications that it says dramatically changes the economics of managing storage.
Venture Funding Activity – 2nd Quarter 2008
||- 16 %
||- 8 %
||- 10 %
||+ 10 %
||+ 547 %
||+ 250 %
||+ 3 %
||+ 5 %
||+ 16 %
||+ 2 %