Interview With Digg, $28.7 million in funding

Posted by: Heather Green on September 24

Amid tons of speculation about whether Digg was about to be sold, the company has…raised more money. It brought in $28.7 Million in Series C funding from investors Greylock Partners, Omidyar Network and SVB Capital. Digg said it plans to spend money on doubling the staff to 150, heading overseas, marketing, and investing in publisher tools.

I didn’t have the time to talk with the Digg folks, but Jay Adelson sent along these responses to my questions.

Q: What kind of staff will your hire?

A: We will be building out staff in every functional area of the company. A specific focus will be in expanding our team of developers to help us scale the Digg infrastructure with the large growth of the site as well as in rolling out a variety of new features. We have only implemented a fraction of our vision for Digg, and increasing our team will help us get there faster.

Q: Where will you focus first on international expansion and how will you do it?

A: We will be rolling out our international expansion in 2009. Since approximately 40% of our current users are international, we see this as a significant opportunity. Of that almost half are from on-English speaking countries. Our goal is to extend the Digg experience in ways that fit in with the cultural norms and or languages of specific regions. We will focus at first on other English speaking countries and customizing the Digg experience. Then we will move to roll out Digg to certain language zones.

Q:I know your aim has been to reach out beyond a tech crowd, how is that going, what kind of metrics can you share? For instance of the 30 million uniques, what percentage read more than tech?

A: Since 2006, the amount of non-tech content submissions has outnumbered tech submissions. This trend continues to this day as our audience becomes increasingly diverse. Our politics and entertainment sections have become some of the most popular sections on Digg.

Q:How do you work with publishers now? What kind of tools are you looking to develop?

A: Digg currently generates billions of monthly impressions from smart “Digg This” buttons that are located on content sites ranging from Business Week to much smaller sites. Many publishers have set up this infrastructure with little help from us and we feel that there is much more we can do to leverage this mutually beneficial relationship. We have worked with some publishers to implement functionality on their sites that highlights the “Most Dugg” content within their site.

With this new funding, we will be developing a variety of new programs to provide better metrics to publishers on the traffic that Digg brings to their sites and how they can more deeply integrate Digg functionality to increase traffic.

Q: Are you profitable yet? How do you think the next few months will be advertising wise, given the state of the market. If you aren’t profitable, how long of a cash cushion do you have?

A: No. Before this round, though, we were fully funded to profitability within 1-2 years. I can say that we are in a very positive revenue environment and that with the behavioral relationship we have with users, we are able to offer targeting that is significantly more precise than other social networks and generates CPS that are an order of magnitude higher than that of other social networks. Our revenues have nearly tripled in the past year.

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