It’s tough to be a seller when there are so many products out there on marketplaces just waiting to be discovered. Promoted.ai is out to help people find you, securing $2 million in funding to continue developing its tool that matches buyers to sellers in marketplace search.
The company was started by two former Pinterest engineer and engineer manager, Andrew Yates and Dan Hill, who wanted to help buyers find what they want more easily, which leads to repeat purchases. And then they wanted sellers to see immediate feedback about how their products appear in a search and tools to improve sales.
“We are predicting for every item in search what someone will engage with and ultimately buy,” Yates told TechCrunch. “It’s the complete package. What we discovered from the industry and customers is that we need to have a data infrastructure so that you can have data in the right place at the right time.”
He explained that Promoted’s technology is more than simply an item, but the optimization of the entire picture: how you fairly come up with a way to share the attention between big and small sellers, then taking into account if the user is satisfied with that search.
Yates and Hill, based in the Bay Area, launched Promoted in 2020 and were part of Y Combinator’s recent winter cohort. In addition to the accelerator, major investors in the capital infusion include Interlace Ventures and Rebel Fund.
Vincent Diallo, managing partner at Interlace, said he was attracted to the company largely due to the team, which he felt had “amazing experience in the space.”
Interlace primarily invests in commerce technology, and Diallo saw two trends that Promoted was addressing: The first was the movement of retailers to increase their range in e-commerce and delivery by opening a marketplace. The second was the increased number of verticalized marketplaces trying to capture a subset of the market through one kind of customer behavior and building a community.
“A big part of Amazon’s performance is from the ad manager and ad revenue, so we were convinced there was an opportunity to build a tool like this,” Diallo added.
The company is targeting enterprise deals and plans to use the new funding on hiring. However, their funding round was a bit unusual.
Much of the team is made up of former Facebook, Pinterest and Google engineers, and with the competitive talent environment, rather than go the traditional seed funding route, the founders decided to give equity for the founding engineering team and raise the remaining funds from individual angel investors putting in $50,000 or less.
“We had to turn away some fantastic funds to make this work, but in exchange, we have a great network of champions, experts and advocates,” Yates said. “We found it better to give equity directly to engineers to recruit top talent because equities are so hot and experienced machine learning and ads engineer cash salaries are so high. We will end up raising additional capital for scaling up the team.”
Though the company is still young, it is already working with marketplace apps like Hipcamp and Snackpass, and customers are seeing lifted conversion rates. For example, Promoted increased Hipcamp’s total booking rate by over 7%, Yates said.
Next up, the company will be focusing on the launch manager side of the product and building out a tool similar to an ads manager for listings.