FreeRide Raises $10 Million in Venture Capital

New York City-based loyalty marketer FreeRide Media LLC said it has closed on venture capital funding in excess of $10 million.

Lead investors are Odeon Capital Partners LP and Applewood Associates LP. The funds will be used to expand FreeRide’s consumer rewards program and to support the development of new products and services, the company said.

With more than 1,300 sponsor offers, FreeRide claims to be the Internet’s largest rewards program, although there is plenty of competition in the incentive marketing arena.

At the FreeRide site, members accumulate “FreeRide Points” by visiting sponsor Web sites, purchasing products and filling out surveys. Points are redeemed for products and services ranging from movie tickets to CDs to magazines to Internet service. FreeRide sponsors include AT&T, Beyond.Com, Disney, Supermarkets Online, Visa, CDnow and Toys R Us, among others.

The latest round of financing is intended to help FreeRide increase membership and launch new offerings, the company said. For example, in addition to offering material incentives to consumers, FreeRide also plans to market customer-satisfaction tools to other Web sites that put them directly in touch with visitors’ wants and needs.

“FreeRide has built a sustainable, long-term revenue model based on satisfying both the consumer and sponsors’ needs,” said Matthew Smith, managing partner at Odeon. “FreeRide understands the fundamentals of attracting and retaining customers in the online environment better than anyone else.”