Telenav acquires NY TechStars grad ThinkNear for $22.5M

Telenav (s tnav) announced it is paying $22.5 million to acquire ThinkNear, a hyperlocal mobile ad startup that helps target consumers with very precise and contextual location-based ads. It’s the first acquisition of a New York TechStars graduate and the biggest acquisition for any TechStars alum.

ThinkNear, which moved to Los Angeles after graduating from TechStars in 2011, is joining Telenav’s mobile local advertising group and will form a new platform for Telenav called Scout Advertising. Now, advertisers will be able to use ThinkNear’s location targeting to reach consumers within 100 meters of any location. But the ads will tap Telenav’s Drive-To Advertising platform to provide browser-based GPS turn-by-turn directions to lead the person to the place that’s being advertised. That’s important for advertisers who want to measure their advertising ROI because they can see if someone arrives at a place after seeing an ad.

ThinkNear began life in early 2011 as yield management tool for local businesses, who wanted to use local mobile ads to drive in people at slow times. ThinkNear tried that route but found it difficult to get enough impressions to deliver to merchants. So it pivoted into a hyperlocal advertising company that aggregated location-based impressions from exchanges, mediation platforms and ad networks.

Eli Portnoy, ThinkNear, TelenavIt also added the ability to do situational targeting, taking into account what consumers are doing nearby, where they are, what the conditions and environment is like around them. ThinkNear now serves dozens of brands and delivers click-through rates four times higher than the average, said Eli Portnoy, founder and CEO.

“I thought this was a fantastic opportunity to combine what we’re doing with what Telenav is doing with browser-based turn-by-turn software. Together, we can reach people at the right time and get them to the store,” Portnoy told me in an interview

Portnoy believes that hyperlocal advertising is proving its worth now and will be a major boost for mobile advertising revenue, which has lagged mobile usage. The company now reaches tens of millions of customers each month with more than seven billion impressions.

ThinkNear, which has 12 employees, has raised $1.7 million to date from Google Ventures (s goog), Qualcomm Ventures (s qcom), IA Ventures and Metamorphic Ventures.