New Round of Funding for AdAdapted 

AdAdapted of Ann Arbor recently announced its new funding round of $725,000 as it moves into the native advertising space to help clients build ads designed for mobile devices.  Co-founders Mike Pedersen, a software developer, and Molly McFarland, a marketing expert, teamed up to found AdAdapted.  Its technology allows clients to create ads automatically and design them to look custom.

The firm had applied for a patent to cover its technology and process and is working with a number of companies to develop its niche in the popular native advertising space.  Among those firms are Enlighten, the Ann Arbor-based digital ad agency and Biore for its skin-care products.  

One of the investors is Scott Brew, president of Adtegrity, a large Grand Rapids-based digital ad firm.  He told Tom Henderson of Crain's Detroit Business that "AdAdapted reduces the friction of advertising on mobile platforms and allows advertisers to run flowing ads that are not disruptive and irritating."

Other investors in this Eiler client include the Frankel Commercialization Fund of the University of Michigan, the First Step Fund of Detroit, Start Garden of Grand Rapids, the Michigan Pre-Seed Fund 2.0 and Grosse Pointe Farms-based Belle Michigan Fund LP which invests in technology companies with women in senior management positions.  Ann Arbor SPARK has also provided AdAdapted with loans and grants.

"Native advertising is a big opportunity," believes Terry Cross, a noted Michigan investor.  "AdAdapted has a good product that has been validated in the marketplace," he explains.  "People do not like mobile advertising so this native technology is a good new alternative."

"Red-Ocean Market" of Apps

Requires Attention to Marketing,

Not Merely Some New App

People or companies that make "apps" have come screaming across potential investors screens in the past few years. Some work well, find a market and become established. Many, or most, do to. Why is that?

Dr. Tom Kinnear, a marketing professor at the University of Michigan Ross School of Business, is a longtime angel investor and counselor to many new businesses over the past 25 years, calls investor's wariness "a red-ocean market." That's because there is much blood ion in the water from new apps firms that have tried to buck the trend of failed firms in the space, as Kinnear reported in a recent piece by technology expert and writer Tom Henderson of Crain's Detroit Business.

As with every other new software application of new technology product, we must ask "what's the market?" I wrote a piece for the Governor's Technology Conference some years back entitled "There's only one thing a start up business needs: a customer." And that rings true today.

People inventing apps and trying to sell them often fail because they have not determined what differentiates their product from existing others in the same or similar space. As Kinnear points out to Henderson, "what is unique about your product that is not easily duplicable? And can you grow your app to be large enough to bring a venture investor enough return."

The answer to these questions are "nothing is different" and "no you cannot" present a known solid return to an investor."

This is an issue that has recurred over many years by technologists and scientists who believe because they have created some new app, the world will beat a path to their door. Not! Marketing - learning who your customer is and figuring out how to reach that person or group with a compelling message - is first and foremost for any new product investor, especially with apps.

There is a serious flaw that exists among many tech people in this area. Marketing needs to be cared for from the outset and not as a mere afterthought as it has been for many years.

Larry Eiler

Here's some new and exciting news!

Michigan's economy is continuing to show slow and steady recovery, reports a new report of the U. S. Bureau of Economic Analysis. It reported that our country's gross domestic product grew 1.8 percent in 2013. While small, this is sound new evidence that Michigan is on a return to better times trail in the continuing improvement from the Great Recession.

The state's gross domestic product was $408 billion for 2013, an increase from $386 billion in 2010.

Nice improvements and this demonstrates the success of the "relentless positive action" approach taken by state government and our business, financial and related segments of the economy.