14 February 2007
South African company IncuBeta has wasted little time in exploiting the potential offered by keyword-sensitive advertising on the internet’s most popular search engine.
Founded by entrepreneur Vinny Lingham in 2003, the web marketing company already has 50 staff, offices in Cape Town, Johannesburg and London and turnover of over R50-million a year.
It also, as of 31 January, has R15-million in venture capital backing for an ambitious growth strategy involving opening offices in Silicon Valley in the US, strengthening its European presence and, by 2009, listing on the Johannesburg or London stock exchange.
Last week, IncuBeta received the first R15-million instalment of a R25-million investment from HBD Venture Capital, the venture capital fund established by South African internet billionaire Mark Shuttleworth.
“This is a truly South African company with no real local competition,” HBD’s Eben van Heerden said in a statement. “It is rated as one of the top three internet marketing companies in the world by Commission Junction, part of the Nasdaq-listed ValueClick Inc.
“The company has developed robust technology in-house and this provides the perfect platform to achieve future expansion,” Van Heerden said.
“IncuBeta’s clients include many of the biggest online retailers in the world, and it operates one of the world’s most sophisticated keyword bid management software systems. We plan to work closely with incuBeta to ensure exponential growth happens quickly.”
Riding the Google, Web2.0 wave
According to IncuBeta CEO Giles Douglas, search engine marketing is growing at over 40% per annum – speeded particularly by the advent of Web2.0, which has changed the internet from a tool used largely for information purposes to an interactive social arena.
“Google is the fastest growing company of all time, and is at the forefront of search and more recently Web2.0,” Douglas said.
Google turnover is derived predominantly from auctioning keywords for searches, allowing merchants to create highly targeted advertising campaigns linked to specific searches.
IncuBeta bids on millions of different keyword combinations, to which it then links targeted advertisements for its clients. The company currently places over 50 million targeted adverts a month.
“In the next few years we expect to see search engine marketing moving from personal computers onto mobile phones, television and even in-car navigation systems,” Douglas said. “We aim to be at the forefront of these technological changes – and the investment by HBD will help us achieve this.”
Ploughing back into South Africa
Douglas says that incuBeta’s headquarters will remain in South Africa, and that the company has begun to transfer its knowledge of search engine marketing and other Web2.0 trends locally.
The company recently launched IncuBeta Consulting to help South African companies to benefit from the many possibilities offered by the internet.
Van Heerden hopes IncuBeta’s success will inspire more South Africans to ake the entrepreneurial plunge. “All too often, we are put off ‘going it alone’ because we believe that our ideas must have already been done abroad.
“This is often not the case, and we encourage local talent with business ideas to explore these to the full. Many of the leading economies of the world were built on small-to-medium size enterprises, so this is a definite priority for South Africa’s future growth.”