But the elephant in the room is that Google is moving into an arena that Santa-Monica based Rubicon Project has been hammering away at since their inception two years ago. And having received over $30M in funding thus far, Rubicon has been on a rampant growth curve this year. In June they began expanding their operations internationally. For publishers wanting to get the most revenue for their inventory while not needing to constantly swap out code and manually crunch the numbers, Rubicon Project has emerged as a top contender. With one implementation it easily allows publishers to manage multiple ad networks and optimize them for the highest payout. And with so many networks competing for so many publishers, this is good for the ad networks too. Of course, Pubmatic, Hubpages and Yieldbuild have also been competing in this category, but the team at the Rubicon Project has executed better than anyone else in this space.

Some have suggested Google’s decision to enter this space is a bad thing for the Rubicon Project. I disagree. Google’s recent decision is the best thing that could have happened for three reasons:

First, it makes Google look defensive, which not only validates Rubicon’s model, but shows investors that they’re onto something. Even Google’s YouTube video on how the process works sounded a lot like Rubicon’s pitch from a year ago. This should make it easier for the Rubicon Project to raise a new round of funding (if they even need it) and/or gain the attention of potential acquirers. It is clear that Rubicon has made enormous traction in an area that a top player now wants a piece of.

Second, it gives the Rubicon Project a new platform from which to speak to ad networks. Let’s face it, Google deals directly with lots of top-tier advertisers and they just won’t be able to convince the networks that they’ll choose network ads over Google’s current blue-chip inventory. Google’s balance sheet would prevent it 9 times out of 10. But since Google is now stoking publishers on a new way to deal with ad networks, it gives the networks a choice: work with Google, continue spending lots of money to out-advertise your competitors, or work with a “network consolidator” like Rubicon. It plays very well into Rubicon Project’s goals to expand and bring more networks into their fold.

And lastly, Google’s momentum in this space only makes the Rubicon Project look more valuable to potential acquirers and large-scale partners (I’m looking at you Microsoft, Yahoo, CBS, CNET and AOL). The non-Google players definitely wouldn’t want to participate in Google’s new program, and the more successful Google is, the more these other players may start thinking about increasing distribution through either a partnership or an acquisition. This puts the Rubicon Project in an amazingly good position.

Of course, there are a few unknowns here. Its hard to say how much traction Google will make with the publishers, or how this might negatively impact an AdSense publisher’s decision to give the Rubicon Project a try. Its also difficult to know how this might help or hinder Rubicon’s ability to move up the value chain and work directly with advertisers (something Rubicon has made clear they won’t do, and understandably, since it would hurt relations with ad networks). Since Google is now working with both advertisers and networks via AdSense, will it change Rubicon’s prospects?

One thing is clear… Google saw Rubicon’s growth as a low-end disruptor as a threat and they responded on Wednesday by opening up their AdSense program to third-party ad networks. For the Rubicon Project this creates new investment opportunities, a stronger proposition to the ad networks, and new value in the eyes of potential acquirers and partners. Especially now that AdSense has crossed the rubicon…

(disclosure: I used to work with Rubicon’s VP of International)

(another disclosure: Three weeks ago, TrendSlate applied to Rubicon’s publisher program. We were denied. )

MyShape.com is basically an automated, internet-based fashion consultant. Users enter their personal measurements, body shape and style preferences, and the system recommends clothing based on this data. No dressing rooms, no long lines, etc. MyShape reports that they recently relaunched the website with new socialized shopping features, measurement systems, and various other features. The site has a video explains their service.

The filing says the fundraising is part of a nearly $12.1M round and the company is already backed by a list of blue-chip firms: Draper Fisher Jurvetson (who led this new round), Lehman Brothers Venture Partners, the Pasadena Angels, and the Tech Coast Angels. Update: Barry Schuler, managing director of DJF Growth Fund, has joined the board.

What is most surprising is that their monthly-unique visitor count is only at ~200k (via Compete.com). With the amount of funding they’ve raised it must mean that either MyShape has bright prospects on the horizon, or they’re pulling in a lot of revenue already. And it would be no surprise. After adding a dress, handbag, and necklace to the shopping cart, the price came to over $1,300.

Insight from Compete shows the company is still in customer acquisition and growth mode:

An incubator like Launchpad LA is important for tech startups in the Southland. There hasn’t been as much access to capital in LA as in Silicon Valley, which means that SoCal startups often need to be boot strapped with a strong focus on generating revenue early on. An incubator can change this by enabling entrepreneurs to build disruptive companies that don’t necessarily have have immediate revenue potential. In the long run, this will bring more industry diversity and talent to Southern California.

Launchpad LA is founded by Marc Suster, a former entrepreneur with two successful exits under his belt and a resume that spans two continents. Also joining Suster are Michael Schneider from MobileRoadie, Ryan Born from AudioMicro, and Abdul Khan from iBeatYou.

According to Launchpad LA’s website they intend to:

“…help young talented startup entrepreneurs get funded and grow while remaining in Southern California. The idea came from Mark’s frustration of seeing too many companies receive funding by Northern California VCs and then relocate their teams. Mark was further inspired by the aims and initiatives of John Morris, the former head of the Tech Coast Angels. The Launchpad LA initiative is a true collaboration amongst Los Angeles’ best VCs who have a shared interest in seeing a robust tech community continue to thrive in Los Angeles. Launchpad LA runs a series of educational meetings and discussions designed to share experiences between serial entrepreneurs and newer CEOs.”

The initial roster of CEOs is impressive:
* Alec Andronikov of Movoxx
* Rob Angarita of Cramster
* Clark Benson of Ranker
* Ryan Born of AudioMicro
* Michael Broukhim of Totspot
* James Citron of MoGreet
* Michael Fisher of ElephantDrive
* Abdul Khani of BeatYou
* Ari Mir of GumGum
* Michael Schneider of MobileRoadie
* Ian Swanson of Sometrics
* Kerry Trainor of FlipGloss
* Jade Van Doren of TechForward

Here’s a panel that Mark Suster participated in at Twiistup 6 in July. Its a discussion about the LA-startup ecosystem with panelists Mark Suster, David O. Sacks, Mike Jones and James Montgomery.

Update: Allen Hurff, former SVP of Technology at MySpace, is rumored to be launching an incubator as well.

After browsing some of the founders’ twitter profiles we noticed a connection related to another LA based company called Crowdgather. Crowdgather runs communities built around message boards and forums. As of September 30, 2008, Crowdgather was serving over 16.5 million page views and reaching 1.9 million unique users monthly.

Our hunch is that these executives are building a way to monetize forums, starting initially with the inventory provided by Crowdgather’s network. It is a wise approach to a segmented and proven portion of the web. Forums are essentially communities around a certain topic which can be leveraged in an ad-network type fashion in aggregate. Typically stand-alone forum sites cannot obtain significant reach above and beyond the niche that they cover. However, if an ad network sits on top of a hundreds or even thousands of forums, then you have quite a business and can charge higher CPMs and everyone benefits.

Lastly, it looks like Crowdgather could use some assistance as they are currently public and traded over the counter. Last time we checked the stock was trading @$1.23 per share. Here is a link to Crowdgather’s Annual Report: (Annual Report for Crowdgather)

Forrester has predicted that the era of social commerce will heat up over the next five years, and NY-based Altrinsic has made a bet on this trend with their recent acquisition of ShopIt.com

Shopit.com is an e-commerce platform that lets buyers and sellers complete simple transactions on social networking sites. Atrinsic claims that the application has been downloaded 800,000 times, and that they will soon allow sellers to import existing listings from eBay & Yahoo stores to social networking sites like Facebook and MySpace.

Social commerce has come a long way over the last couple years. Facebook tried to push the movement forward with their Beacon product, but that ended poorly when users were automatically opted into what seemed like a violation of privacy. But the landscape is different today. The “walls” and “activity streams” of social networks are now a major major distribution channel for content & links, and younger users are connecting more and more to one another rather than to institutions. Social-commerce start ups can benefit in a big way from this. But they’ll also need to mitigate a major risk… With advertising revenues dipping, social networks are clamoring for ways to add transactional revenue to their books. The barriers to entry are quite low.

ShopIt.com is based in Los Angeles and received $2.5M in Series B funding from Emerson Ventures and Propulsion Ventures.