This morning Datacy, a startup with its headquarters in Wilmington, Delaware, announced that it has closed $2.4 million in new funding to continue building its consumer-friendly data collection and monetization service.
The company is effectively an argument that the preceding sentence is possible. Datacy is a tool that allows individuals to collect their browsing data, manage it, have it anonymized and aggregated with others and then sold. The end-user gets 85% of the resulting revenue, while Datacy takes 15%.
Its model has found financial backing, with its new capital coming from Trend Forward Capital, Truesight Ventures, Redhawk VC, the Female Founders Alliance and others. The startup raised the funds using a convertible note that was capped at $9.5 million, though TC is not certain whether or not there were other terms associated with the fundraising mechanism.
Regardless, Datacy’s model fits into the modestly more privacy-forward stance that the technology world has taken in recent years; Apple is not the only company looking to make hay off of what some consider to be rising consumer interest in keeping their activities, and data, to themselves. But what Datacy wants to do is merge the consumer privacy impulse with profit.
According to company co-founder Paroma Indilo, her startup is not a cookie blocker. She told TC that if someone wants to block data collection, there are good tools for the task in the market already. What Datacy wants to do, she said, is evolve from its current status as a control platform to the way that data is shared and exchanged, built atop user consent. With monetization, we’d add.
It’s a better vision for the future than the hellscape adtech and data-vendor market that we’ve become accustomed to.
Today the startup has live beta users, allowing it to learn and collect initial data. The company is waiting to make the business side of its operation open to all until it has 50,000 users; Indilo told TC that individual data is not worth much, but in aggregate it can be worth quite a lot. So to see the startup wait to scale up its sales operations until it has a larger user base is reasonable.
It may not be too long until Datacy reaches that 50,000 user mark. From a current base of 10,000, and what Indilo described as 30% monthly growth via word of mouth, it could hit that mark in a half-year or so.
Datacy is one of those early-stage bets that has a lot of potential, but also a notable helping of risk. If it can attract the masses it needs to prove out the economics of its model, its payments to its user base could make growth a self-fulfilling destiny. But if its ability to garner more users slows, it could fail to reach sufficient scale for its model to work whatsoever.
So it’s a good use of venture capital, in other words. We’ll check back in with Datacy in a few months to see how close it is to its 50,000 user goal. And how its bet that consumers want their data back is playing out.