Dynamics Direct Closes $12.5 Million Funding Round

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Rich media email marketer Dynamics Direct Thursday closed a $12.5 million round of funding, making it one of the few online marketing firms able to wring a hefty amount of cash from VCs in these turbulent times.

The Series D round was co-led by Mofet Venture Capital Fund and Botticelli Venture Funds -- the latter of which counts ad group giant Omnicom as an investor. Bruce Redditt, executive vice president of Omnicom Group, joins Dynamics Direct's board of directors through the agreement.

Other firms repeating earlier investments in the company include Polaris Venture Capital, Eucalyptus Ventures and Concord Ventures. Poalim Capital Markets Technologies also participated.

Representatives from the Los Angeles-based company, which integrates marketers' databases with rich media emails --enabling mass mailings of personalized information -- said the funding had been earmarked for use in developing its technology and expanding sales and marketing efforts.

"Obtaining this investment, in a climate in which it is increasingly difficult to find the right funding, is yet another confirmation that data-driven rich media advertising is providing online marketers with the ROI they have long sought," said Dynamics Direct president and chief executive Russ Gillam.

Despite the woes currently facing the online marketing industry -- including investor apathy in the public markets; questions about reporting metrics, standards and effectiveness; and concerns about whether broadband's slow rollout will stymie consumer response to rich media ads -- interest in rich media email seems on the rise.

In late December, Electronics giant NEC launched a U.S.-based rich media email firm designed to capitalize on the company's technology to capture a share of what it sees as a lucrative market.