Weekly Startup Profiles > Tyroo
|With the recent entry of ad networks, the face of Indian online advertising is changing. And Tyroo is one of the forerunners. Founder Harish Bhal tells you more|
Online advertising network that connects websites having ad space with advertisers.
For Harish Bhal, the internet business was an all-too-familiar territory. He had seen and done it all. A Computer Science graduate and a serial entrepreneur, he founded Smile, one of the first Internet Business Solutions Company in India in 1999. Since then, he has created Studio Smile, an incubator program that incubates and accelerates digital business ideas; Zoomtra, a travel search engine; Zumtra, a travel technology company and Quasar Media, a digital media and E Business solutions company.
It was while working in Quasar Media that he toyed around the idea of starting Tyroo. He was beginning to realize the huge potential of online advertising. On one hand, he saw Small and Medium Enterprise, ignorant about publicity planning, struggle to advertise their products and services online. On the other, he realized that the online advertising market had inventory (web space available to feature advertisements), but had no channels to reach out to interested SMEs. As an internet solution provider, Harish grasped this gap even more clearly. "Opportunities were hitting us on a daily basis. We already had our existing clients with ad inventories waiting to be taken up. Both the parties were looking for a solution," recalls Harish. It was this understanding that resulted in his founding Tyroo.
As an IT industry expert, Harish knew that the online ad market in India was becoming a big business. "The size of online ad market was around Rs 350 crore in 2006-07, and growing at a rate of 60 % year-on-year," he reveals.
"A huge chunk of the online advertising market were in the hands of large sites like Indiatimes, Rediff, Yahoo India, Google India, Sify, MSN India and Moneycontrol. Against this backdrop, there were many smaller online publishers and niche websites who could not grow big either because they had limited resources to reach out to potential advertisers like the SMEs, or not big enough sales force," he adds.
Keeping these factors in mind, Tyroo brought with it a self serve technology platform that ensured that advertisers reached out to the right websites using Tyroo's inventory of publishers.
Tyroo, as an ad network, brings together and represents such web publishers and their inventories (which becomes a huge size after being grouped) to prospective advertisers and marketers. Offering their own self-serve technology platform, where ad buying and matching in the online space is done by their proprietary software, the platform connects publishers with the advertisers and vice-versa.
Thus, smaller websites find it easier to generate revenue for their websites, while Tyroo gets its share of commission. Tyroo usually maintains a 15 % margin.
With its technology, Tyroo provides to big companies as well as SMEs an opportunity to target their ad campaigns in over 200 countries, with budgets as low as Rs 2,500. At the same time, it makes the internet advertising market more competitive by providing better ad-pricing for advertisers and giving them more alternatives.
Tyroo's competitors include Google Adsense, Ozone Media and Kombli. Harish believes that Tyroo, with its positioning of being the only self-serve technology platform, is already ahead of the competition. "Other companies rely on technology products which are launched in the US, which cannot always be customized to meet the needs of Indian advertisers," Harish says.
He adds that Tyroo's technology platform, apart from being original and more suited to the Indian market, is also feasible for scaling up.
Besides that, Tyroo's focus is to have a leadership position in the SME segment as it is an untapped market. "Google already has a lead with the top tier and big publishers. We don't want to break into that. But as far as SMEs are concerned, at any given point of time, Tyroo should have ad inventories equivalent to the top five-seven publishers," he says.
Tyroo received an initial finding of $1 million from Studio Smile, which was essentially used to build the proprietary technology platform.
In July 2007, Yahoo bought over 35% stake in Tyroo. The cash infusion by Yahoo was used to invest in technology and sales network to reach out to small and medium sized advertisers and publishers in India.
The company was founded by Harish and Manish Vij. Manish Vij was the head of ad sales at Rediff for six years before he joined Tyroo as Chief Business Officer. While Harish's experience as an IT entrepreneur gave direction to Tyroo, Manish Vij became the prime mover of the business.
Within two years, Tyroo has the biggest inventory of ad spaces and the largest network of publishers in India. Starting with a group of 100 publishers, today Tyroo has a 2,500 strong publisher network which includes Perfspot, Facebook, About.com, SantaBanta, Smashits, Yatra, and OneIndia. The company counts Microsoft, General Motors, Pepsi, ICICI and Yahoo amongst its advertisers.
"Operationally", says Harish, "The business is self-sustainable. "We are not leading it any more," he adds. Tyroo boasts of an annual growth rate of 200-300%.
With the latest infusion from Yahoo, Tyroo intends to branch out into new verticals.
In January 2008, business daily Mint, a part of the HT Media group, listed Tyroo as one of the "10 Most Interesting Start-ups" to watch out for in 2008.
"Sustaining growth," says Harish. "Right now we are growing very fast and this might set wrong expectations. Eventually, all organizations will reach an organic, natural growth stage. The high growth can't go on forever," he explains.
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