Alembica startup that applies the mathematics of pandemic-era contact tracing to marketing attribution today announced a $14 million Series A funding round led by entertainment mogul Jeffrey Katzenberg's company WndrCo.
The round comes amid growing demand from marketing chiefs at Fortune 500 firms for AI-powered tools to measure return on investment from massive marketing budgets which are increasingly distributed across digital channels.
“We always ask Fortune 500 CMOs about their biggest challenges. “The most typical answer is to exhibit the effectiveness of promoting spend,” WndrCo partner Justin Wexler told VentureBeat in an exclusive interview. He added: “It's truly in WndrCo's DNA to mix progressive technology with among the most forward-thinking CMOs.”
Predicting the long run of sales
Alembic's software tracks marketing campaigns based on sales results, allocates revenue and predicts future ROI across TV, radio, podcasts, social media and other unstructured data sources. The startup applies techniques originally developed during COVID-19 to detect causes and patterns in disparate public health datasets.
“You can consider it as a large dot where all and sundry is someone you may connect the dots with,” said Tomas Puig, founder and CEO of Alembic. “We use huge amounts of information to predict where the connections will happen.”
This “contact tracing” of information points occurs in real time, an enormous advantage over marketing mix models that may take months to provide results.
“People call me the nerdiest CMO they’ve ever met. “These problems are only as serious as any of the opposite giant data problems that everybody else is coping with, even perhaps more so because they lie on the intersection of art and science,” Puig told VentureBeat.
The pursuit of measurable ROI
Graphics chip manufacturers are among the many first customers to make use of Alembic NvidiaWater sports brand North SailAnd Texas A&M Athletics. The funding will help Alembic attract more technical talent and expand its product range.
“Trillions and thousands and thousands of dollars are spent on brand marketing yearly,” Katzenberg told VentureBeat. “And normally, there’s actually no hard data to prove ROI.”
“The use of AI enables firms to extend productivity in ways in which weren’t previously possible,” Jensen Huang, founder and CEO of NVIDIA, said in a press release to VentureBeat. “Alembic uses AI designed for scientific research applications to predict ROI from marketing. NVIDIA Marketing uses Alembic with great success.”
Alembic's approach aligns with CMOs' growing frustration with the shortcoming to measure marketing effectiveness and concretely link spending to sales results. Katzenberg, who has unsuccessfully evaluated several attribution solutions prior to now, believes Alembic's technology has world-changing potential.
“Somewhere between the meaning of life, the Holy Grail and the Fountain of Youth is 'I spent a dollar, but is it actually doing anything?'” Katzenberg said of the problem of quantifying marketing ROI despite trillions in brand spending. “That’s what we were so enthusiastic about, what Tomas and this amazing, amazing, very unique team of engineers that he has put together.”
