Ad Age's Jason Del Rey covers the acquisition of semantic technology provider Peer39 today for $15.5 million by DG. Read it. And, read the DG release. According to Crunchbase, Peer39 had raised $27.4 million to-date. Ouch. In that a part of the acquisition is a stock-based earn-out, Peer39 could get some of that original investment back in the long run. But, this isn't what Peer39's investors had in mind.
Del Rey notes that DG's own stock price has plummeted to $9 as the public markets have crushed the company's valuation post-MediaMind acquisition as competitive pressures for its HDTV ad product revenues have hurt.
Peer39's assimilation into DG/MediaMind will leave other, semantic/contextual providers either looking to add more products, tools and services - or another, similar acquisition partner. Real-time ad platform AppNexus buys Crystal Semantics? DSP MediaMath buys Proximic? Ad verifier DoubleVerify buys uKnow?
The acquisition isn't a cue that Peer39 tech was a failure. Peer39 technology is and was widely-respected technology in the ad tech industry as programmatic buying uses contextual information about a page to - in part - inform on a bid for a display ad in an auction.
Also, Peer39's industry relationships could be appealing to MediaMind as could Peer39's team - the release notes, for example, that Peer 39 CEO Andy Ellenthal gets DG's EVP of Sales and Ad Operations role "for both the TV and Online divisions, reporting directly to Neil Nguyen, CEO of DG." With Ad Age's Del Rey, DG CEO Nguyen positions the acquisition more around development of the MediaMind marketing "stack."
Nevertheless, Peer39's sale is an indication that contextual or semantic (however you label it) targeting has been largely commoditized as classifying what a page is more easily implemented by the machine and a group of astute ad tech programmers. This type of deal was echoed long ago with Collective's purchase of contextual tech firm Personifi in 2008, for example. Personifi founders Frost Prioleau and Paul Harrison have since moved on to found search retargeting platform Simpli.fi. Ad tech entrepreneurs just can't get enough.
By John Ebbert