French video supply-side platform Teads has raised 43 million euros in debt financing – about $48 million – to continue pushing its outstream video ad formats.
The financing came from several sources, including French multinational bank BNPP, Bank of China and HSBC.
The company has raised $70 million in combined VC and debt, according to executive chairman Pierre Chappaz, money it will use to expand internationally and “aggressively pursue” M&A opportunities.
Its latest debt financing will allow the company to pay for acquisitions in cash, rather than shares, thus slowing dilution.
“This new debt facility is namely targeted at funding our Asian expansion,” Chappaz said. “Until today, we have been focusing mainly on the US, Europe and [Latin America], with Japan being our only operation in Asia. Bank of China likes to support global businesses such as ours, and they will certainly help us when we enter China next year.”
The company wants to tap into significant demand from luxury brands to distribute video campaigns in China, Singapore and other Asian markets, said Chappaz. Teads needed local teams on the ground in the Asia-Pacific region to build relationships with influential publishers and brands.
Teads is no stranger to building through acquisition. In 2014, it merged its sell-side technology offering with European video ad platform Ebuzzing, which is focused more on the demand side.
Since then, Teads has focused on constructing a marketplace for outstream video ad formats while striking deals with larger exchange players like AppNexus.
The company has partnerships with several major demand-side platforms and claims programmatic now represents 30% of total revenue. Its objective is for programmatic to contribute 50% or more by mid-2017.
Outstream video, however, faces a number of challenges.
Unlike pre-roll video ads, outstream doesn’t precede traditional video content and that can lead to some trepidation from buyers. Most mobile and web users are familiar with lousy outstream ads, such as videos that autoplay with the sound on.
There are also unique technical requirements inherent to serving and measuring these formats apart from pre-roll.
Still, outstream is all the rage judging by the number of competitive and complementary offerings that have cropped up of late, including Google’s newfound support for the format.
“We have been the first to offer an outstream SSP, as well as vertical, square and 360-degree outstream formats,” Chappaz claimed. “We are the only ones capable to run on Google AMP, and hopefully soon on Facebook Instant Articles.”
Teads employs 450 people, 100 of whom are engineers comprising its development team in France.
On the brand side, it has strategic agreements with Microsoft, IBM, UBS and Samsung. It works with publishers such as The Washington Post, Forbes, Mashable, Slate and The Guardian, whether through direct deals or technology whitelabeling.
