Startup Nexad Wants To Make AI Talk Ad-Sense

“Irrelevant ads and banners are now a thing of the past,” claims the team of Nexad as this adtech startup comes out of stealth mode. The first AI-native ad network seamlessly integrates personalized, real-time, and context-aware advertising into AI-powered conversations.

Therefore, ads or banners will not seem disruptive and unnecessary, but rather they will add value to a user’s search responses.

Founded in 2024 by Jason Hu, the company has raised $6 million in seed funding from investors including Andreessen Horowitz’s Speedrun, Prosus Ventures, Point72 Ventures, and Sequoia Capital’s Scout Fund.

Nexad’s platform uses a “flywheel” model to deliver personalized ads alongside user queries within AI apps, refining ad targeting based on user engagement. The company generates text- and image-based ads using a combination of open-source and proprietary large language models, such as Llama, Gemini, Anthropic, and OpenAI. Nexad’s network currently includes seven AI companies, including iAsk and Dippy AI, reaching approximately 30 million consumers.

According to a Business Insider report, advertising on AI platforms is still in its early stages, but some of the biggest AI companies are already testing or considering incorporating ads into their products.

OpenAI has recently expressed its openness to exploring advertising, according to the Financial Times. At the same time, AI search startup Perplexity started testing ads in November.

Nexad’s platform is an AI-powered engine that understands not just what users are searching for, but why. When someone asks an AI assistant a question, for instance, about travel options, skincare, or investing, its system analyzes the intent, tone, and context of that query. Then, using a blend of open-source and proprietary LLMs, including Llama, Gemini, OpenAI, and Anthropic models, Nexad generates an ad that matches the flow of the conversation. The result is a personalized ad that feels less like an interruption and more like a useful suggestion.

Nexad’s models go beyond text generation to create image-based ads, dynamically adapting content to align with various AI interfaces and user preferences. Built on a real-time architecture, Nexad’s ads can change as users explore new topics or shift their intent, ensuring that the content remains relevant and engaging throughout the conversation.

For decades the digital advertising landscape has been shaped by Google, generating billions in ad spend and fostering industries focused on Search Engine Optimization and Search Engine Marketing (SEM). However, the emergence and increasing popularity of AI-native search engines like ChatGPT, Perplexity, and DeepSeek are transforming the established norms of digital advertising