M&A – yessss. VC hearts from ad technology have skipped a beat with excitement.
And, why wouldn’t an e-commerce marketer purchase a DSP or retargeting machine?
Or was this an exit before Google flattens everyone in the retargeting space?
Yesterday, CEO Chris Saridakis (formerly of PointRoll) of GSI’s Marketing Services division pulled the trigger and acquired FetchBack for an alleged $40 million according to TechCrunch -and that’s not bad for a company that TechCrunch says only raised $1 million.
The purchase begs another question: Is this the beginning of the M&A tidal wave and consolidation?
From an e-Commerce perspective alone (leaving aside Google, Microsoft, Oracle, Cisco, you name your favorite SaaS infrastructure provider), it would seem plausible that companies like Amazon, eBay and many others could pop into the picture as they may want to own marketing technology in order to overlay their own critical, marketing strategies. GSI apparently thought that now was the time to buy. Though prices for certain DSPs – due to investment to-date – may be hard to swallow initially, there may be elasticity at work here as these suitors start doing the math and see that they’re leaving money on the table, if not endangering their long-term strategies, by not aggressively stepping into the exchange-buying environment – especially as their competitors start scooping up DSPs and retargeters.
As stated here on AdExchanger.com previously, it makes sense that purchases will also be driven by the need for a talented team to drive the new data-driven marketing strategies. In fact, FetchBack CEO Chad Little told AdExchanger.com in an interview last year: “If you need heart surgery you wouldn’t go to the family doctor. If you have a choice of a specialist over a generalist, the majority of the time you’ll choose a specialist and for good reason.”
In the GSI release, somebody has been drinking the DSP Koolaid as the first benefit to Fetchback’s technology is: “Multi-Network, DSP, Exchange Reach.” Read it. Ad networks may be smiling here, too. Their in-house teams and technology are taking advantage of exchange buying today to varying degrees.
So, is this the beginning of M&A for demand-side platforms, ad networks and ad tech, in general?
