One of the newest tech companies joining advertising with user-generated video is San Francisco-based Podaddies (say it Po-daddies, like a Creole sandwich). We caught up with CEO Nate Pagel this week to get a teaser on what the company hopes to do.
Pagel is probably in contention for longest digital video resume ever, on the technical side starting with designing interactive CD-ROMs in 1993, and on the artistic side with a long career in media art and installations. When he says he wants to “support independents by providing targeted dynamic ads that are maximized based on a cost basis,” it almost doesn’t sound like marketing schtick.
Pagel is aiming at customized solutions rather than automated ones, building platforms specifically for the video-sharing sites he has signed. “I’m the turtle, and not the hare, in this video advertising space,” he said.
Pagel’s domain doesn’t extend to choosing the type of ad to run on a specific site, but he is one of the many who think preroll ads are too much of a deterrent. “My opinion is post-roll 8-second spots will be the industry standard, with some minimally-intrusive, mid-roll advertising as well,” he said.
He trumpeted a recent Adweek article that said the cost of online video advertising spots is on the verge of surpassing the cost of television spots.
Agency execs said 30-second pre-roll spots, which play before video content, now cost from $25 to as much as $40 per 1,000 plays. That’s a 25 percent increase in the past year, making it rival the cost to run the same spot on many network programs, media execs say.
The article conflates advertising sold against both user-generated and professional content, a distinction that advertisers don’t seem ready to gloss over quite yet. However, figuring out how to monetize non-premium content is something that will undoubtedly be worth a lot of money.
Pagel claims he has funding offers from both venture capitalists and angel investors, and is contemplating which route to take. Other companies in the space, such as Brightroll, have raised money from both VCs and angels (in Brightroll’s case, from the same firm, True Ventures, that funds GigaOM). Podaddies, which will have five employees as of January, has already signed more than one yet-to-be-disclosed customer.
We’re not sure startups can afford to be “turtles” in a space that’s attracting so much interest, but we’ll certainly keep an eye on Podaddies.
Update: We asked Pagel about the origin of the name Podaddies. He replied, via email, “pod – podcast. addy’s – emmies of ad world. we take po’ daddies and turn them into rich daddies. Who’s Yo’ Daddy?”