By Marine Cole

DoubleFusion, which has developed a technology to insert advertising in video games, will soon start raising between $5 million and $10 million in a Series B round, according to DoubleFusion's co-founder and executive vice president of business development, Guy Bendov.

Founded in 2004, the company has so far been funded by JVP Studio, the incubator and seed investment arm of Jerusalem Venture Partners, which has invested $600,000.

DoubleFusion's technology inserts rich media advertising - such as billboards, 3D and 2D animation, as well as music - in online video games. Content is provided to customers according to analyzed data such as a player's zip code for instance. DoubleFusion also provides reports on efficiency of ad campaigns to advertisers.

The company has spent its first year of operations largely focused on developing its technology, but has already signed some customers, both advertisers such as Procter & Gamble and eBay Inc. and video game publishers such as Data Design Interactive, based in the U.K., and Team Six based in the Netherlands.

Its technology will be first released in a car racing video game called Crazy Taxi, which is set in London. "It's relevant for European advertisers," Bendov said.

Elie Wurtman, chief executive of JVP Studio and board member of DoubleFusion, said "ingame" advertising offers the same kind of flexibility than with the Internet. "We've started with video games because it's a huge market," he said. "From an advertising perspective, it's completely untapped." Advertisers are hoping to capture the 18- to 34-year-old male consumer, who watches less television but spends more time playing video games. For video game publishers, advertising brings a new revenue stream.

The new financing, which DoubleFusion will start raising toward the end of the second quarter, will be used to enter the U.S. market and open an office in the U.S., most likely in the Silicon Valley.

Bendov said he plans for DoubleFusion's technology to also be used in different medium beside video games such as television, mobile phones and even interactive television.

The Jerusalem-company currently has 11 employees, mainly developers.

Other companies providing "ingame" advertising include Massive Inc., which is backed by NeoCarta Ventures, DFJ Gotham, DFJ New England, RRE Ventures, Tobat Capital and Newlight Associates.