German broadcaster RTL Group, which acquired a 65% stake in the video ad server and supply-side platform SpotX in 2014, said Wednesday that it has purchased the remainder of the company for $145 million.
RTL, which houses SpotX with other technology and content assets under a division called the RTL Digital Hub, also plans further ad tech investments.
SpotX and SmartClip, the video distribution platform RTL acquired in March, will collaborate on video ad solutions and identify opportunities for acquisition and partnership to benefit RTL’s larger business.
In recent months, SpotX has pushed its integrated SSP and ad server businesses, espousing the benefits of a combined system. That’s why, as of the first six months of 2017, 50% of its revenue came from programmatic services, growing 35% YoY. Ad server revenue grew 71% YoY.
SpotX’s revenue grew 2.3% YoY during the first half of the year, based on International Financial Reporting Standards. But, its revenue grew 20% YoY if basing that figure on US GAAP measures.
RTL didn’t break out a specific revenue amount for SpotX, but RTL’s digital businesses totaled 389 million euros, or about $462 million, for the half year.
Meanwhile, SpotX’s managed services declined 48% YoY and accounts for just 23% of total SpotX revenue. Private marketplace deals now make up 49% of SpotX’s video transactions.
“I think you’ve always got to be innovating and planning for the long game,” Mike Shehan, founder and CEO of SpotX, told AdExchanger. “When I first signed the deal with RTL, our SaaS-based and ad-serving fees were a blip on the radar. Now, we’re making over 25% of our revenue off of fees, not just percentage of gross media.”
Shehan doesn’t expect RTL’s full ownership of SpotX to change its day-to-day operations. But SpotX hadn’t been aggressively expanding, since the financial terms of its original RTL deal were tied to performance.
“That hampered some of our efforts to do more aggressive things on the corporate development, M&A or partnership front, so if anything, [this deal] has cleared the decks for us to be more aggressive in pursuit of our vision,” he added. “Nothing should really change in terms of who SpotX is or our mission.”
RTL has helped SpotX expand its global footprint considerably.
When it acquired a majority stake in the company in 2014, SpotX had eight people in its London office. Now, it has more than 80, as well as new offices across Europe and joint ventures with RTL subsidiaries IP Deutschland and RTL Netherlands.
“I’ve learned much more about broadcast, as well as the nuances of each market throughout Europe,” Shehan said. On the flip side, “RTL got more access to ad tech, but also exposure to the US market as well. We’ve achieved a lot of goals we originally set out with.”
