Netblue Gets $20 Million in Funding

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Online direct marketing company Netblue received a $20 million round of venture financing, the company said yesterday.


The Mountain View, CA, company received its first institutional funding from Oak Investment Partners. Netblue plans to use the backing to expand its online direct marketing business, which develops customer-acquisition programs for clients such as JP Morgan Chase, Discover Financial and Columbia House.


Formerly called YF Direct, the two-year-old company designs customer-acquisition programs using online marketing vehicles, including paid search, banner ads and e-mail. Netblue produces the creative, buys the media and hosts the ads. Clients pay per customer delivered.


In a typical Netblue campaign, it bids on a search term like "Ashlee Simpson CD." The paid listing, which offers a free Simpson CD, directs to EveryFreeGift.com, a site operated by Netblue. After a registration process, customers are offered a series of products such as a Publisher's Clearing House sweepstakes, an online degree program and mortgage refinancing.


Customers must accept one offer from Netblue clients like Discover, Columbia House and NetFlix to receive their gift. Customers also are required to opt in to Netblue's e-mail list of offers.


Netblue founder/CEO Kenneth Chan said the company bases its online marketing efforts on traditional offline promotions, such as credit card companies that offer college students free gifts if they apply for a credit card.


Though Netblue aims to take the complexity out of online marketing for its clients, Chan said it is sensitive about protecting their brands by steering clear of spammers and spyware companies.


Chan said Netblue is profitable and has 70 employees.


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