“The real trend that sticks out in recent months is a significant increase in value for transactions,” Gross said.
Petsky Prunier, another investment bank focused on media, tech and marketing, recorded 654 deals for a total of $22.1 billion in March, more than in any previous month in the past three years.
Marketing clouds had a pretty quiet 2017 and have become more selective acquirers, according to a LUMA Partners M&A report released Monday.
But corporate-friendly tax reform in the US and booming stock values for Salesforce and Adobe could open up M&A opportunities.
“There’s tremendous liquidity in the market right now in private equity and on corporate balance sheets,” Gross said, combined with cloud companies, particularly those with roots in commerce like SAP and Salesforce, looking for transformative acquisitions that could move the needle despite their large market caps.
Commerce-based buys are getting strong consideration from more than just marketing cloud strategics. Ecommerce and commerce services represented 23% of transactions in the past quarter, according to Petsky Prunier, but drove 37% of overall M&A revenue.
But LUMA founder and CEO Terry Kawaja has a different take. Unlike JEGI, he notes that total ad and mar tech deals counts were up compared to the same time last year, but with fewer blockbuster deals.
Still, the acquisitions that are taking place are encouraging, he said.
WeWork’s acquisition of Conductor, a 13-year-old SEO and online marketing platform, likely came at a bargain, but it shows how new potential exits are emerging, Kawaja said.
Pandora’s $145 million deal for AdsWizz and Placecast, a location-based DSP, selling to the Swedish telco Ericsson also show how new categories can be ad tech acquirers. Late last month, Nike acquired the digital customer analytics startup Zodiac.
Cloud giants like Salesforce and SAP are well-understood acquirers searching for clear fits in their marketing stacks, Kawaja said, “but we track new entrants because it’s noteworthy that now companies outside the typical sectors are interested in the kinds of capabilities you find in the digital advertising and content landscape.”