Former Ad Tech Exec Investing Millions in Mobile

Longtime mobile ad exec Nihal Mehta used to focus on ensuring advertisers invested in mobile ad platforms. Now he’s interested in assisting the new generation of mobile businesses. 

Mehta retired from mobile ad tech firm LocalResponse in 2013, now known as Qualia, where he served as CEO. He wanted to focus on mobile startup investment full-time via the firm he co-founded in 2009, Eniac Ventures. The firm raised $55 million to invest in the mobile tech landscape, and is looking to put the money into early-stage mobile startups. Mehta noted his firm is especially interested in companies who have not yet “raised a funding round,” are still in product development, and probably haven’t generated revenue. 

The areas that piqued the interest of Mehta and crew in regards to mobile startups include connected devices, personal utility, app development tools, messaging and communications, enterprise, marketplaces, and commerce. Mobile ad tech that “spans several categories” will also be high on the firm’s to-do list according to Mehta, who pointed out the increase of free ad-supported mobile apps such as Snapchat and Instagram, neither of which run standard display ads.

"The next big wave of mobile ad tech companies will be bigger than we've ever seen because they're going to be forced to deal with a supply of new inventory. It doesn't live anymore in banner ads; it lives in messaging, communications, interstitials, natively," Mehta remarked recently. He sold his mobile-marketing firm ipsh! to Omnicom in 2005.

Eniac Ventures was co-founded in 2009 with three fellow University of Pennsylvania graduates. It has stakes in Airbnb, Circa and SoundCloud, and also invested in several ad tech companies, including Mehta's former company Qualia, as well as Adtrib, mParticle, and Localytics.

As of now the company has made eight investments, including in password replacement tool LaunchKey, on-demand parking service Luxe Valet, and social commerce company Strut. Mehta and the Eniac Ventures team want to invest in at least 15 more companies by the year’s end. 

Eniac Ventures plans to initially invest $500,000 in each of the 35 startups, which equals more than the $250,000 per company. Mehta noted Eniac Ventures is setting aside two-thirds of the $55 million fund as “follow-up money”, which he plans to reinvest in the companies as they grow and become successful.

The follow-up money is essential because "in today's market you can get money from anybody," said Mehta.  "Funds that can't follow can create a negative signal to the marketplace. And oftentimes entrepreneurs want to know they're getting in bed with somebody who can support them all the way.” 

Companies Eniac Ventures invested in and have subsequently been acquired include Mobile ad-targeting specialist Metaresolver, which was sold to mobile ad-tech company Millennial Media in 2013. Ad-tech firm Beanstock Media bought mobile publishing technology company Onswipe in 2014, while Twitter acquired mobile retargeting firm TapCommerce the same year.