The Year In Acquisitions Suggests An Ad Tech Reality Check

M&A 15If 2014 was a year of big buys in ad tech, 2015 seemed more muted. While 2014 saw a run on attribution companies from big players like Google and AOL, massive consolidation among data management platforms and some big splashes from Oracle and Alliance Data Services, 2015 was about the quiet private equity exit.

Sure, there were some major acquisitions. Twitter made its biggest ad tech buy yet, grabbing TellApart for $532.6 million. (Though what has it done with it since?) And Verizon, of course, broke the bank for AOL at $4.4 billion. But by and large, those were kind of rare.

Instead, we saw a lot of companies divesting their ad tech assets to private equity firms (Experian Marketing Services and eBay) or companies in need of cash fleeing to those PE firms (Selligent, StrongView, Mediaocean).

But if there was one company that seemed pretty consistent in its ad tech investments, it was the British agency conglomerate WPP, with its purchase of Medialets and The Exchange Lab to build out its real-time media capabilities. It also bought Google’s digital agency of record Essence Digital, which it folded into the GroupM family.

The following is an inexhaustive list of some key M&A activity that happened in 2015.

February

DataPop: Remember when Criteo was just a French retargeting company? Of course, the company has been building out its capabilities, and its acquisition of DataPop enabled it to connect retailer product catalog data to online ads. So, more ads optimized to shoppers.

Smart AdServer: French Internet portal AuFeminin spun off its programmatic ad platform business Smart AdServer and sold it to Cathay Capital for $42.1 million. Why? Smart AdServer needed investment, and Cathay could provide it. Cathay in particular was good at helping firms expand globally, and Smart AdServer wanted to grow especially in North America.

March

eXelate: Nielsen’s $200 million purchase of eXelate gave the measurement giant a data management platform (DMP) and a data exchange. Nielsen really got some new capabilities with this one – namely audience segmentation capabilities and the ability to monetize audience data.

Veenome: Integral Ad Science gives its video offering a boost with the acquisition of video analytics provider Veenome. Basically, Veenome’s tech is designed to inform advertisers of the context in which their videos will appear – so it’s basically a brand safety tool. It also provides qualitative insights for exchanges that are onboarding publisher partners.

Triton Digital: Vector Capital snapped up Triton Digital for an undisclosed amount, gaining a firm whose tech connects audio supply with advertiser demand. It seems like an instance where Triton simply needed money and Vector could provide it. As its CEO said in a release, the acquisition will let Triton “accelerate our growth through investments into our products, customers and partners.”

Yieldex: AppNexus got some analytics, forecasting and sales management tools with its Yieldex buy. The Wall Street Journal and AdExchanger sources pegged the buy at about $100 million in cash and stock. The goal for AppNexus, as per CEO Brian O’Kelley? Building a better ad server. To that end, AppNexus planned to hook the product into its Open AdStream ad server (which it got from WPP) as well as its proprietary buy-side programmatic guaranteed product, Twixt.

Triggit: Retargeter Triggit was Gravity4’s seventh ad tech acquisition. This one was likely a fire sale, as Triggit had, according to a source, been burning through cash. Gravity4, established by Gurbaksh Chahal after his ouster as CEO of RadiumOne, has bought numerous other low-cost ad tech assets. To what end?

Viralheat: PR software company Cision bought social media and content marketing platform Viralheat.

Chango: Presto! For $122 million, Rubicon Project got Toronto-based search and web retargeting firm Chango. In so doing, Rubicon got a toehold in intent marketing, as Chango has search query data mixed with behavioral and contextual data.

April

DataSong: Marketshare snapped up marketing analytics startup DataSong, which caters to omnichannel retailers. Marketshare hoped to use the tech to connect digital intent with in-store sales. Perhaps that’s still in the cards – though Marketshare was later purchased by Neustar.

Falk Realtime: German mobile ad platform Fyber, which helps its clients manage ad network demand, spent $11 million for Falk Realtime’s SSP and ad-serving software.

Pointmarc: Media and marketing analytics combine! CRM agency Merkle bought performance marketing agency Pointmarc for undisclosed terms. Pointmarc and its 100 or so employees went into Merkle’s Quantitative Marketing Group and enhanced its site- and channel-based optimization. Also important: Pointmarc’s offices in Seattle and San Francisco as well as its work with big Fortune 500s, including Microsoft, T-Mobile and Williams-Sonoma.

TellApart: Twitter unlocked the checkbook for this one. In its largest ad tech acquisition to date, it bought digital ad platform TellApart for $532.6 million. That’s $200 million more than what it plunked down for its mobile exchange, MoPub. Why would Twitter roll out the red carpet for TellApart? A few reasons: TellApart has a lot of large retailer customers and supports complex use cases in that sector. Add those capabilities to Twitter’s login data, and you’ve potentially got a potent cross-device direct response solution. That was the dream, anyway. The only question is: Where is it now?

Medialets: Holding company WPP snaps up mobile ad platform Medialets, which it bound into a unit focused on real-time media investments called Connect.

Ensemble: Remember when dynamic creative optimization (DCO) was all the rage? Well, Adobe has bought into it again by snapping up DCO tech, called Ensemble, from ad net Collective. It’s not a huge buy, but it adds functionality to Adobe’s Media Optimizer DSP.

Dunnhumby: Dunn and dunn. After months of waiting, the shopper data mart formerly owned by British superstore Tesco was finally purchased – at least in part – by Kroger. That is, the supermarket chain bought “certain assets” – i.e., Dunnhumby’s technology and about 500 of its employees, housed under a Kroger subsidiary called 84.51°.

May

Proximic: ComScore bought pre-bid solution provider Proximic, with the intent to integrate it into its validated Campaign Essentials and Media Metrix products. Basically, Proximic lets agencies and advertisers filter inventory prior to buying.

AOL: This year’s big buy: Verizon plunks down $4.4 billion in cash to acquire AOL, inheriting its media assets as well as its ad tech stack. APAC telcos Telstra and Singtel already made incursions into ad tech, but Verizon’s buy was the biggest example of a North American carrier doing the same. Merging Verizon’s customer data with AOL’s ad tech could prove immensely powerful. On the media side, the two released a video content network in September called Go90, which has an upfront commitment from Publicis Groupe. There’s a data play there as well: Publicis gets early access to certain, though unspecified, targeting capabilities within the Verizon-AOL DMP. Expect to see those capabilities go live in January 2016.

StrikeAd: Sizmek built out its mobile capabilities with the $11.7 million acquisition of mobile DSP StrikeAd. While Sizmek hooked into a bunch of exchanges, it didn’t have one to call its own. StrikeAd was meant to fill that media acquisition void.

Bidstalk: What does every app marketing platform need? A mobile DSP. Hence, AppLift bought Singaporean platform Bidstalk, a white-label product plugged into numerous mobile programmatic sources. Those sources include MoPub, Google AdX, Rubicon, MediaMath, Brightroll and more. Additionally, Bidstalk is intended to help AppLift break into APAC. Meanwhile, AppLift believes it can push Bidstalk into Europe and North America.

June

Maxifier: Norwegian provider of publisher ad tech Cxense bought Maxifier, provider of tech that optimizes direct sold campaigns, for $3.6 million in stock. Maxifier seems to be another cog in Cxense’s machine – one that the acquiring company hopes will be a SaaS stack for publishers. Additionally, Cxense hoped Maxifier (whose CEO Denise Collella left a week before the acquisition to join NBC Universal) would help it penetrate the North American market.

Real Media Latin America: AppNexus buys Real Media Latin America (RMLA). The Brazilian company was once the Latin arm of 24/7 Real Media, whose Open Adstream ad server also is owned by AppNexus.

Mediaocean: Another example of a private equity firm snapping up an ad tech company, this time it’s Vista Equity Partners going for Mediaocean, which provides trafficking and billing software for ad agencies. At the time, Mediaocean chairman Michael Donovan compared Vista to a holding company, saying the firm has a lot of operators, as opposed to finance pros.

Nativ: Ooh la la! One year after getting bought by APAC telco Telstra, video platform Ooyala bought video asset management platform Nativ. Add this to Ooyala’s 2014 acquisition of programmatic platform Videoplaza, and it’s easy to see a company slowly building up its video ad stack.

July

Dailymotion: Finally, Dailymotion has a home. French media holding company Vivendi bought an 80% stake in the video streaming site. This is nearly two years after Yahoo failed to do so – mostly due to French regulatory pressures. So with Dailymotion, Vivendi is stronger in video and TV distribution.

Selligent: Remember this one: Private equity firm HGGC buys European marketing automation company Selligent. Selligent, like many companies getting that PE buyout, needs the funds to grow its product line. But this is important because in September, HGGC will buy US-based email platform StrongView and, one month later, merge the two.

eBay Enterprise: eBay exits the enterprise tech game and sells off a bunch of its assets to various private equity firms. Total cost: about $925 million. So what’s eBay unloading? Database marketing provider MBS, attribution company ClearSaleing, affiliate and paid search tool developer PepperJam Exchange, mobile messaging company M3 Mobile, sell-side media company GSI Media, display retargeter FetchBack and email and agency services company E-Dialog. That stack is being broken up and sold to PE/asset management firms, including Sterling Partners, Longview Asset Management, Innotrac and Permia.

Polyvore: Yahoo snapped up social commerce company Polyvore for an undisclosed sum, though The New York Times and Re/code later reported the figure to be at or above $200 million. How successful was this acquisition? Well, just a few months later, a manager at hedge fund SpringOwl used it as an example of Yahoo CEO Marissa Mayer’s wasteful spending in a slide deck he sent to the Yahoo board.

August

TVN: Video platform Tremor pushed into Australia by acquiring video SSP TVN. While terms weren’t disclosed, it was a smallish acquisition, as TVN had 14 employees. For Tremor, though, the real value was those APAC relationships.

Maxymiser: Oracle added another component to its marketing cloud by purchasing Maxymiser, a provider of A/B testing and web personalization software. The purchase fills a pretty big hole for Oracle. While its competitor Adobe had web personalization tools, Oracle to this point did not.

BlackArrow: Cross MediaWorks, owned by national media network Cadent, snapped up BlackArrow, a provider of live and video-on-demand ad products for TV companies. The intent: Help create software tools that improve reporting and data measurement around converged TV buys. The acquisition brought BlackArrow closer to the demand side.

September

Millennial Media: AOL finally puts mobile ad platform Millennial Media out of its misery by acquiring it at a valuation of about $238 million. AOL wanted Millennial’s assets to build out its cross-device capabilities, filling out opportunities on the supply side and with app developers. Essentially, AOL had a lot of demand and needed to get into mobile app monetization, and Millennial has a mobile SSP.

AreaOne: Want to get close to Facebook? Simply spend $17 million on a partner! That was a big rationale for mobile DSP Taptica shelling out for AreaOne. The other reason: AreaOne has presence in China. While Facebook and China are like oil and water, Facebook is actually a big source of international traffic for Chinese devs.

WhoToo: Demandbase bought B2B behavioral data platform WhoToo.

Supersonic: App discovery platform ironSource bought mobile monetization platform Supersonic. The goal? IronSource wanted to be a full stack solution, and Supersonic would help it provide opportunities to target and measure across the entire funnel.

StrongView: Private equity firm HGGC strikes again, this time snapping up email marketing platform StrongView. StrongView’s goal: money to speed product growth. Of course, in July, HGGC also bought European marketing automation company Selligent, which was supposedly more of a mid-market product. Result: It merged the two.

October

Weather Company: Here’s one few saw coming: IBM bought the Weather Company’s digital assets. But this is likely less about IBM entering the world of publishing and more about IBM snapping up the Weather Co.’s data. What to make of this? Some analysts believe it could be IBM’s prelude to heavier investment in a marketing cloud.

November

Essence Digital: This isn’t purely a tech buy – though it’s in the arena. WPP bought digital agency Essence Digital, which it will incorporate into its GroupM family. Essence has a lot of programmatic capabilities, in large part because it is Google’s digital agency of record. That’s a lot of in-house expertise around how to use the Google stack.

Marketshare: Neustar snapped up measurement provider Marketshare for $450 million, its third big acquisition in marketing analytics. (The other two: TargusInfo and Aggregate Knowledge.) Neustar has invested heavily into its marketing software to make itself competitive with the big guys, like Adobe and Oracle.

December

Undertone: Another ad net exit? This time, performance advertising company Perion acquires Undertone. Unlike Undertone’s peers, Perion noted when it made the buy that the ad net was profitable. Undertone had recently invested a lot in engagement-driven ad units, and Perion wants to put that together with its own intent-based advertising expertise.

Mojn: Everyone loves a data onboarder. And programmatic email platform LiveIntent got one when it bought Copenhagen-based Mojn, soon after buying European recommendation engine AVARI. The goal? LiveIntent wants to expand internationally. It will also leverage Mojn’s tech to map intent in a cookieless environment.

Experian Consumer Insights: Another private equity buyout. This time, Symphony Technology Group (STG) spent $47 million on Experian Marketing Services’ Consumer Insights division. Consumer Insights includes Simmons Research and Hitwise. For Experian Marketing Services, this is likely an attempt to hone in on its core business. Meanwhile, Simmons Research and Hitwise fit much better into STG’s portfolio of companies.

Exchange Lab: Chalk up another digital ad investment for WPP. This time, the holding company bought The Exchange Lab, a marketing services organization that owns Proteus, designed to link up multiple DSPs. As with its earlier Medialets purchase, WPP will incorporate The Exchange Lab into its Connect unit, focused on real-time media. The Exchange Lab will hopefully allow WPP to sort out problems around media fragmentation.

4 Comments

  1. Interesting highlights to call out, but I definitely agree that one of the themes this year in media M&A was "marketing tech" companies, but I'm surprised the publisher acquisitions didn't get more of a mention - BusinessInsider, Elite Daily, HomeAway, Orbitz, Meredith Corp, and many others in addition to AOL were some of the biggest of the year. I suppose those aren't ad tech in the same way, but publisher consolidation was a key trend in 2015 in my view.

    I track all the ad tech M&A activity on my blog here: http://www.adopsinsider.com/ad-tech-mergers-acquisitions-activity-tracker/ and I count 136 transactions this year worth north of $25 Billion vs. 162 in 2014 worth nearly $40 Billion, though it's hard to know how to assign value when the press is estimating the value.

    The biggest transaction of the year - AOL. But the second biggest? DealerTrack, which was scooped up for $4 Billion in cash by Cox Automotive in June. The third biggest? HomeAway, the vacation rental publisher, which was bought by Expedia in November for $3.9 Billion (though I don't think the deal has officially closed yet). While HomeAway isn't obviously in the ads business, they were big on the conference circuit a few years back talking about the ad extension business they ran based on the travel intent data they could gather.

    Last year the biggest acquisition by far was Facebook's purchase of WhatsApp for $19 Billion, followed by Publicis's purchase of Sapient for $3.7 Billion.

    Reply
  2. Jax Teller

    LOL, "AOL finally puts Millennial Media out of its Misery." You should have heard the wailing from the people that still owned MM stock. It was light a brigade of cats yowling.

    Reply

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