AdReady investors believe the startup is poised to do for display advertising what Google did with text ads and sponsored links.

Seattle, Washington-based AdReady helps advertisers see what’s working and what’s not working to optimize ads, said Ajay Agarwal, managing director at Bain Capital Ventures.

“Normally this would require lots of technology and consulting firms,” Mr. Agarwal said.

The self-serve display ad startup on Monday scooped up $10 million in a second round of funding led by new investor Bain Capital Ventures and joined by previous investors Khosla Ventures and Madrona Venture Group. DoubleClick investor Bain Capital Ventures is particularly attracted to the growing online display ad market right now, Mr. Agarwal said.

AdReady, with its free library of templates, aims to eliminate the financial and technical barriers that have limited online display advertising to only big brands and agencies.

We’re “democratizing online advertising for all businesses,” AdReady CEO Aaron Finn said.

The startup, whose services are similar to those of Spot Runner and AditAll, offers over 600 online display ad templates in categories such as real estate, dining, shopping, travel, and automotive.

The site, launched in test mode in October, allows people to customize prefabricated ads by changing the words used, fonts, images, and background color. Click-through rates are listed below each template, so advertisers can quickly see which designs are the best performers. AdReady then distributes the finalized design through Google and Yahoo's network Right Media.

While designing the ad is free, AdReady takes a 20 percent cut of the marketing revenue after the client sets a budget for the campaign.

The site also offers a co-branded version of its service to publishers and agencies. AdReady has already launched a co-branded advertising platform with Allrecipes.com.

The 28-employee startup plans to use the funding to increase staff and marketing and to enhance its self-service advertising platform.

Former Classmates.com online advertising executive Mr. Finn said that he has learned what pictures and words work in online ads, and he hopes to now bring those best practices to small and medium-sized businesses.

“The background color or picture can really make a difference in an ad’s performance,” said Mr. Finn. “Without that knowledge base small and medium businesses can’t compete. They don’t have the money to create that data.”

That issue has kept small and medium-sized businesses on the sidelines, Mr. Agarwal said.

Under the funding deal, Mr. Agarwal has agreed to join AdReady’s board of directors.