Ground Truth emerges from stealth with mobile metrics idea |
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One of the biggest frustrations in the technology industry over the years has been the challenge of actually trying to count what is going on. The problem was highlighted this weekend by Internet provocateur Jason Calacanis, who in a blistering blog post called for a boycott of comScore and labeled the Internet measurement company an extortionist.
You can agree or disagree with Calacanis' argument. But this much is certain: Accurately tracking and measuring what's happening on the Internet remains a big headache for advertisers, journalists, analysts and anyone else who simply wants to discover the true numbers. Those problems are multiplied when it comes to the mobile Web.
Seattle-based Ground Truth -- which is emerging from stealth mode today after more than two years of development -- is looking to tackle that problem head on. And the company -- backed by Steamboat Ventures and Voyager Capital and led by executives from Seattle's wireless industry -- has developed a patent-pending methodology which it says accurately measures the mobile Internet.
"We are the first mobile measurement company to have actual numbers," said Ground Truth founder Michael "Luni" Libes, who previously co-founded Seattle startup Medio Systems. "And we are the first company to provide the necessary critical metrics for publishers and advertisers to do their business."
Libes
Over the past 18 years, Libes has been involved in five startups in the Seattle area. And, in each case, the 40-year-old entrepreneur said he's created the companies by taking a "stab in the dark."
"I looked back -- and this was one of those 'a-ha moments' -- at all of these business plans that I've written and all of these companies that I've started and I realized that I did them all without any market information whatsoever," he says.
From that, Ground Truth was born. The company is taking a different approach than survey-based research firms, including comScore which in 2008 paid $44.3 million for Seattle mobile measurement firm M:Metrics.
Ground Truth is different, Libes said, because it collects data direct from wireless carrier and infrastructure partners and then reports on that information on a weekly basis. The company says it has the ability to measure data on 2.5 million mobile users -- by far the largest sample size of any mobile measurement firm. It is starting out by tracking mobile Web sites, including the measurement of hits, pages, unique subscribers, session time and total number of bytes transferred to the phones.
That means a mobile Web site publisher could find out how many visitors came to their site, how long they spent and what they did while they were there.
"If you go to publishers and ask them how many people they have on their mobile site, the true answer is they don't know," said Libes. "The best they can tell you is page views and sessions, and they can make a guess."
At this point, Ground Truth is not reporting data based on specific handsets such as the iPhone or Droid. But that could come over time, Libes said.
Accessing critical customer data from carriers and other partners is not the easiest of tasks, and the company has spent a considerable amount of time over the past year making sure that it does so without amassing personally identifiable information. The track records of the Ground Truth executives -- including chairman Tom Huseby and CEO Sterling Wilson -- have helped to open doors on the vast data warehouse.
"It takes a lot of explaining, and a lot of work and a lot of trust to get that information through, percolated, analyzed and agreed upon," said Huseby, a venture partner at Voyager Capital and an early investor in Ground Truth. "It is tremendously hard and it relies on relationships that have gone on for years, like 10, 15 years. There's a huge amount of trust."
If it were easy to compile the data, Libes added that he wouldn't have started the company because the barriers to entry would have been so low.
As part of the business model, Ground Truth plans to sell its reports to the carriers so they can track what mobile sites are performing well or how they are doing against the competition.
Wilson
"They can get information that helps them improve their offerings to their subscriber base," said Wilson, the former Qpass president who joined Ground Truth as CEO last summer. "There is a bunch of information they can get from just using our data to improve their business."
Wilson declined to say whether Ground Truth pays to access the carrier data, and he refused to comment when asked how much it charges the carriers for the reports. He also declined to disclose the company's data providers.
In addition to selling market information back to carriers, there's a second component to the business in which Web site publishers, investment banks, advertising agencies and others can purchase a subscription to the service. Those reports can tell Web site publishers -- a Facebook for example -- how their mobile audience compares to the competition. The service also tracks the mobile ad networks.
The annual subscriptions range in price from $1,000 to $100,000.
Of course, the large analytics companies such as Omniture and Google are a potential threat. Web measurement firms such as Nielsen and comScore also are paying close attention to mobile. And because of that, those firms could pose some competition. However, Wilson said because they've operated as survey companies for so many years it really isn't in their "DNA" to collect actual data from the mobile operators.
M:Metrics, the comScore unit which maintains offices in Seattle, was one of the first companies to track user and advertising data as it related to the mobile Web. However, Libes said they couldn't put together a definitive list of the top 20, 100 or 1,000 mobile Web sites.
One of the reasons why Ground Truth stayed under the covers for so long was so that the company didn't draw attention to the problem and how it was addressing it, Libes said.
Ground Truth raised $2.6 million last June, and it is likely to go after more money at some point.
Huseby said he's already been fielding inbound calls from other venture firms who are interested in participating in the next round. For now, he said Voyager and Steamboat are deeply committed to the startup.
Huseby
"This company is being run on the basis that there's a lot more money where that came from," he said. "We are not sitting here trying to bootstrap and incremental our way into this market. We are being run by a guy who knows how to build a big company and do it fast."
Huseby is excited about the opportunity in part because he's been talking for years about the importance of mobile advertising. However, he never really had any hard numbers to back up his statements.
"There are hundreds of mobile deals a year, and nobody knows anything," said Huseby. "I've gone to every advertiser in mobile that I can find and I realize that they don't know. And I don't know."
Now, with Ground Truth, Huseby's finally hoping to have some numbers to back up what he's been talking about for years.
John Cook is co-founder of TechFlash. Follow on Twitter @johnhcook.
John Cook is co-founder and executive editor of TechFlash. He has been covering the technology beat for nearly a decade, writing about startups, entrepreneurs and venture capital, most recently serving as a reporter/blogger at the Seattle Post-Intelligencer.
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