Optilly/InstallMonetizer was a Y Combinator Winter 2012 company that built a Windows software monetization network before pivoting to Facebook ad optimization. Founded by Vince Mundy and Lloyd Jacob in 2011, the company initially found success with InstallMonetizer, a platform that helped software developers monetize free and trial software through bundled installations[1]. Despite raising $500,000 from top-tier investors and achieving profitability by early 2013[2], the company was ultimately killed by its core business model: major security vendors classified InstallMonetizer as malware, forcing a pivot to Facebook advertising that couldn't sustain the business.
Vince Mundy and Lloyd Jacob founded the company in 2011 with the vision of creating a "selective ad network for desktop software"[3]. The founding team identified an opportunity in the Windows software ecosystem where developers struggled to monetize free and trial versions of their applications. Their solution was InstallMonetizer, a platform that would bundle additional software installations with legitimate downloads, creating a revenue stream for developers while theoretically providing value to users through software recommendations.
The company was accepted into Y Combinator's Winter 2012 batch, giving them access to Silicon Valley's premier startup accelerator and its network of investors[1]. The team grew to 11 people as they built out their Windows-based software distribution network[1].
InstallMonetizer was a Windows-based software distribution and monetization network designed to help software developers generate revenue from free and trial software installations[3]. The platform worked by bundling additional software installations with legitimate downloads, creating what the company positioned as a "selective ad network" that would recommend relevant software to users during the installation process.
The technical approach involved integrating with software installers to present users with additional software options during the installation flow. Publishers (software developers) would integrate InstallMonetizer's SDK into their installers, and the platform would serve targeted software recommendations based on user behavior and preferences.
After the malware crisis forced them away from their core business, the company pivoted to Optilly, a Facebook ad optimization platform focused on app install campaigns[1]. Optilly offered campaign management tools that optimized Facebook app install campaigns based on cost per action (CPA)[9]. According to founder Vince Mundy, what set Optilly apart was "fractional factorial multivariate testing" for Facebook ads[7].
InstallMonetizer operated in the crowded and controversial software bundling market, competing with established players in the Windows software distribution ecosystem. The company positioned itself as a more selective and quality-focused alternative to traditional software bundlers, emphasizing relevance and user value over pure volume.
The pivot to Optilly placed the company in the rapidly growing Facebook advertising optimization market, competing with numerous other platforms offering similar campaign management and optimization services for mobile app marketers.
InstallMonetizer operated on a revenue-sharing model where the company took a percentage of the monetization generated through bundled software installations. Publishers integrated the platform and earned revenue when users installed recommended software through their installers.
We could not find specific information about Optilly's pricing model or revenue structure for the Facebook advertising platform.
InstallMonetizer achieved significant early traction, working with more than 9,000 publishers by January 2013[2]. The company was profitable by this point and experiencing rapid growth, with the number of installations doubling every two to three months[2].
The company successfully raised $500,000 from notable investors including Andreessen Horowitz, Digital Garage, Fenox Venture Capital, SV Angel, and Transmedia Capital[2].
We could not find specific traction metrics for the Optilly platform after the pivot.
The primary cause of InstallMonetizer's failure was its classification as malware by major security vendors. In January 2013, just as the company was hitting its stride with profitability and rapid growth, Y Combinator began investigating the company for potentially distributing crapware and malware[4]. This investigation became public, creating significant controversy in the tech community.
The situation deteriorated throughout 2013 as major security companies officially classified InstallMonetizer as unwanted software. Microsoft labeled it as "SoftwareBundler:Win32/InstallMonetizer," describing it as "a program that installs unwanted software"[5]. Malwarebytes and other antivirus products began detecting InstallMonetizer as "PUP.Optional.InstallMonetizer.A" (Potentially Unwanted Program)[6].
This classification effectively killed the core business model, as users' antivirus software would block or remove InstallMonetizer, making it impossible for publishers to use the platform. The pivot to Optilly in 2014 represented an attempt to salvage the company by moving into Facebook advertising optimization, but this new direction apparently couldn't generate sufficient traction or revenue to sustain the business. Both InstallMonetizer and Optilly are now permanently closed[10].
1. Regulatory and ecosystem risk can kill profitable businesses overnight. InstallMonetizer was profitable and growing rapidly when security vendors classified it as malware. Founders should carefully evaluate whether their business model depends on the continued tolerance of powerful ecosystem players.
2. Software bundling is a fundamentally compromised business model. Despite positioning itself as "selective," InstallMonetizer couldn't escape the inherent user experience problems of software bundling. The line between legitimate software recommendations and unwanted bundleware is thin and ultimately determined by security vendors, not the company.
3. Pivots require more than just changing products. The move from Windows software monetization to Facebook advertising represented a complete change in target market, technical expertise required, and go-to-market strategy. The company may have lacked the domain expertise and market positioning needed to succeed in the competitive Facebook advertising space.
4. Y Combinator backing doesn't protect against fundamental business model flaws. Despite having prestigious investors and accelerator support, the company couldn't overcome the core problem that its primary product was viewed as malware by the broader ecosystem.
5. Timing matters for controversial business models. The software bundling industry faced increasing scrutiny in the early 2010s as security vendors became more aggressive about protecting users from unwanted software. InstallMonetizer may have been viable earlier but launched into an environment of increasing hostility toward bundling practices.