More than $100 million of venture capital has been poured into brand marketing businesses since the beginning of 2014, according to a recent report from VentureBeat. And, with a new survey forecasting an uptick in venture capital deals over the rest of the calendar year, content companies are poised to add even more investment dollars to this significant haul.
The VentureBeat report notes that investment opportunity and market need are combining to drive rapid investment in a marketing strategy that barely existed a few years ago. This has produced a wide range of content marketing providers who are simultaneously vying for branded customers and investment dollars to accelerate their growth.
That market-specific progress is bolstered by improving economic conditions and an upbeat outlook among investors. In a survey conducted by the National Venture Capital Association, 59 percent of venture capital firms anticipated a greater level of venture investments going forward.
“These results reflect a greater level of optimism,” according to business media firm JOSIC, which reported on the survey: “Those that participated in the survey predicted that 2014 would bring improvements in initial public offering, volume for venture-backed companies, greater employment, and improved returns.”
JOSIC went on to say that venture capitalists and CEOs appear to believe the business climate is improving and the entrance risks for new entrepreneurs are on the decline.
As those risks decrease, the apparent opportunity for producing content rises. The early high-profile investments already made in 2014 are expected to inspire further deals later in the year, as both content startups and opportunistic venture capitalists look to seize the moment and claim a share of this industry boom.
Those up-and-coming content marketing companies aim to tackle all aspects of this new industry, from content creation to analytics, and are even working to provide effective management tools such as content marketing software.
As is typical with the birth of a new industry, the explosion of new businesses has created a level of market saturation that cannot be maintained over the long term. Inevitably, analysts note, some businesses will close up shop after struggling to claim a sustainable share of the new content marketplace. Those companies that do gain financial traction will still need to be careful about how they utilize their funds.
According to Pando’s Michael Carney, the key for both companies and investors will be trying to strike while the iron is hot without becoming too overzealous. Carney argues that, amid the frenzy of investment dollars flying around, it’s easy to forget how easily any of those companies can fail—especially if they start spending too much, too fast, without a well-thought-out strategy in place.
“Just because you can spend [investment dollars] doesn’t necessarily mean you should,” Carney said.
Consequently, the influx of investments will help create a buyer’s market for businesses seeking out content marketing solutions. Over time, the best content marketing software will rise above the competition, provided they remain financially viable to that point. Lean content marketing operations are a necessity at any time, particularly in a saturated market where profit margins can be slim.
Businesses can help manage their content creation at scale by using workflow efficiency tools such as a content marketing platform, which allows businesses to expand or grow their content services as their needs change over time.
In the short term, the saturated brand marketing industry could hurt some companies by overwhelming them with options and causing them to hitch their content cart to the wrong agency horse. As VentureBeat points out, businesses inundated with content marketing options need to be even more discerning when hiring these services. Despite all the seed companies currently angling to become industry regulars, some will go belly-up before they ever reach the point of being fully operational, financially stable content marketing companies.