Advertising straight to your ears: Instreamatic service with Russian backers raises $6.1M

Instreamatic, an interactive audio advertising service with Russian founders, raises $6.1M in Series A financing. Progress Ventures led the round, Accomplice and Google Assistant Investments also took part.

The product idea is not just to embed brand advertising in the audio stream, but to allow listeners to interact with it. The mechanics are equipped with artificial intelligence that regulates the response to the user’s answers. This technological solution can be embedded in both podcasts and music apps, adapting ads to the listener’s responses in the future and taking into account even the tone with which the person responds.

Audio projects have grown during the pandemic, showing high popularity and interest from users and investors. An example is the development of podcasts, podcasting platforms themselves, and the introduction of audio chat features on prominent social networks following the explosive growth of Clubhouse. In this context, voice advertising is a field of great opportunity. According to Juniper Research, we can expect the US voice advertising market to grow to the $19B marks by next year.

The startup claims a 12% to 19% user engagement rate for its audio advertising content. Platforms such as Pandora, Salem Media, Gaana (an Indian music streaming service) are currently using the platform, and an agreement was recently signed with Universal Electronics to expand voice advertising into the smart TV industry.

“Consumers don’t like to be fed annoyingly repetitive ads. Brands are under increasing pressure to make these moments more meaningful while maintaining high ROI requirements. On the audio and video platforms side, there are promises made to brands. Our voice AI infrastructure, used by brands such as IKEA, Infiniti and HP, as well as on platforms such as Pandora and Gaana, empirically demonstrates that conversational marketing benefits brands, consumers and publishers alike,” says Stas Tushinsky, CEO of Instreamatic.

Apart from Tushinsky, the Instreamatic team also includes Simon Dunlop (former CEO/cofounder of Bookmate and Zvuk projects), Viktor Frumkin (cofounder of Zvuk and Bookmate), and CTO Ilya Litjuga (one of the first members of RuTube team) and Andy Whatley, a US radio industry veteran.