Vaudit, an AI-powered auditing platform for digital ad spend, has raised US$7.3 million in seed funding led by Mucker Capital, with participation from AVV, AppWorks, Plug and Play, and Kyber Knight.

The company, previously known as BlokID, has secured a total of US$8.5 million.

Vaudit provides real-time monitoring of digital ad campaigns and reports on billing discrepancies, aiming to help businesses address wasted ad spend.

The company reports having audited over 558 million ad events for more than 1,000 customers and claims to audit over US$150 million in annualized ad spend.

Vaudit plans to use the new funding to develop automated workflows and expand support to more digital ad channels, including TikTok and Amazon.

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🔗 Source: Vaudit

🧠 Food for thought

1️⃣ Ad fraud losses persist despite years of industry investment in prevention

The scale of digital advertising fraud remains significant even after substantial industry efforts to combat it.

Ad fraud losses were estimated at $6 billion in 2013, and despite various initiatives, recent projections suggest losses between $26-42 billion annually, with some estimates reaching $100 billion by 20231.

Even when the industry celebrated progress in 2019 with fraudulent impressions blocked more often than delivered, global losses still totaled $5.8 billion that year2.

This ongoing problem highlights why experienced adtech veterans like Omar Hamoui, who built AdMob before selling it to Google for $750 million, are supporting Vaudit’s unique approach to the issue.

Research shows that fraud tactics have evolved from simple click farms to sophisticated operations like the 3ve botnet, which stole $36 million between 2014-2018. This demonstrates how fraudsters adapt faster than prevention measures1.

2️⃣ Financial auditing fills a critical gap that fraud detection alone cannot address

Traditional fraud prevention focuses on blocking bad traffic before it reaches advertisers, but Vaudit’s approach addresses a different issue: verifying what advertisers actually get billed for.

Industry data shows that 10-30% of advertising is not seen by consumers due to fraud and viewability issues, yet advertisers still pay for these impressions1.

The company’s discovery of up to 30% monthly overcharges for some customers suggests that billing discrepancies extend beyond fraudulent traffic to include delivery failures and measurement errors.

This explains why major companies like Procter & Gamble cut $200 million in digital ad spend in 2017 due to transparency concerns, and why Google began issuing refunds for fraudulent traffic that same year3.

Vaudit’s approach of providing “legally defensible audit evidence” addresses what one industry expert called the fundamental problem: advertisers lack visibility and control over where their media dollars are spent4.

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