Rhythm NewMedia has completed its third-round of financing, totaling $10 million, to accelerate the growth of brand advertising through mobile video.

The mobile video ad network?s financing was lead by QuestMark Partners and included participation from existing investors Lightspeed Venture Partners, Morgenthaler Ventures and Rembrandt Venture Partners.

?The funding will be used mainly to expand the sales team and ad operations,? said Ujjal Kohli, CEO of Rhythm NewMedia, Mountain View, CA. ?I think as far as advertisers, we are in the early majority.

?The first phase was in 2008 and started with the experimenters and then in 2009 it was the early adopters and now 2010 is the early majority,? he said. ?We?ll have about 125 different brands by year-end and these are Fortune 500-class brands.

?They prove that mobile video is suitable for brand advertising.?

Rhythm?s publishers include AP, Discovery, CBS News, AMC, Fox, Food Network, Newsday, CW, TMZ, E! Online, Ellen, BET, Animal Planet and vh1.

Advertisers include AT&T, Procter & Gamble's Gillette, Tide, Gain and Pantene, Duracell, Macy's, Best Buy, Klondike, Kraft, Michelin, Sprint, Shell and Toyota.

Video gaga
Focusing solely on premium publishers nationwide, Rhythm?s growing mobile video ad network is claimed to have averaged 425 million monthly impressions in the third quarter and grew 30 percent from the first quarter to the second. 

Rhythm?s video and display ad units offer engagement through the video and rich media. 

As the exclusive provider of interactive, in-stream, pre-roll video ads across Android, iPad, iPhone and iPod touch, Rhythm enables leading brands to run mobile advertising campaigns.

?In the next year or so I expect to see very rapid expansion of mobile video,? Mr. Kohli said. ?This will be driven by the rapid adoption of smartphones and the improvement of the networks they are on.

?Premium subscription-based content is losing to the ad-supported model,? he said. ?Tablets are a great experience for mobile video and are moving the space forward.

?There are huge numbers of video views and even though mobile video is not yet a big part of the equation, the growth rate is unbelievably high.?