With Its Facebook Marketing Business Growing, Buddy Media Raises $23 Million to Fund Expansion

The most lucrative area for developers on the Facebook platform has been social gaming to date, but the companies that provide marketing products for businesses on Facebook have been telling us that they’re having a great year. Buddy Media is one of the larger ones, having established itself as a provider of Page management software to major brands. It’s now riding a new wave of brand marketing spending on Facebook, and it just raised $23 million third round of funding to help it expand.

Based in New York City, it has grown its brand and agency client list from 100 to 300 companies, including seven of the 10 largest marketers and “a lot of the top 100,” chief executive Mike Lazerow tells us. It has been increasing its headcount to match, from 30 last year to around 100 today across its sales and development operations.

Buddy Media provides tools for managing pages, like comment moderation, applications for Page tabs, and analytics software, and intended for larger organizations with 10 or more Pages to manage. You often won’t see its branding on its products, but chances are you’ve used one — like its vitaminwater market survey game or its Mattel Hot Wheels interactive car customizing app. It has focused on providing a set of services that clients can select from for their own needs, while some competitors have focused more on custom work for clients, or other market segments, like small businesses.

The overall market is still much smaller than social gaming on Facebook — we expect the US virtual goods market to bring in $1.6 billion this year — but some larger brands and are spending tens of millions on Facebook advertising and marketing, and Buddy is profitable, growing revenue 15% a month, and in position to catch future growth as more brands continue to increase spending.

The new funding will go towards expanding its business on Facebook, including more development for clients looking to use the Graph API to build Facebook features more deeply into other sites and applications, and mobile applications. It is also looking to grow its Twitter and Youtube offerings. It is also looking for developers from the Bay Area, and Lazerow says he’ll pay the moving costs and first month’s rent for anyone they hire who goes to join at headquarters.

Institutional Venture Partners led the round with existing investors Softbank Capital, Greycroft Partners and Bay Partners participating. Other Page management companies that have raised money in the last year include Wildfire, which raised a $4.04 million first round in late April and Involver, which raised an $8 million third round earlier this month.