Moving the pieces on the board

Plus: A highly scientific ranking of the largest private ad tech companies

Author

Ari Paparo
June 17, 2024

Another rollicking news week with Oracle’s exit and multiple M&A deals. Let’s make sense of it.

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Also this week we talk about the Oracle news, and the rebirth of ad tech M&A.

Listen to the pod now:

Moving the pieces on the board

On our weekly pod Eric and I dive into the biggest news stories touching ad tech and marketing. This past week had so much going on that I thought it was worth using this newsletter to add some more color. As always, links to the news stories are in the Reading List section, below.

Oracle exits ads

Oracle built a data-centric advertising empire by spending a reported $3 billion on acquisitions, and now it is kaput. They announced the decision on their earnings call, supposedly without telling the employees first, or at all. Insider reported that the division had previously generated over $2 billion in revenue, so quite a decline.

“…in Q4, we decided to exit the advertising business, which had declined to about $300 million in revenue in fiscal year '24”

—Snippet of Oracle conference call

Some hot takes, in no particular order:

  • The BlueKai DMP business (and really the entire DMP sector) disappeared a couple years ago. The tech was highly dependent on 3P cookies and didn’t make the jump to mobile in the way CDPs did.

  • The BlueKai data marketplace took a kick in the shins when Facebook removed third-party data from their platform, and it was also very cookie dependent.

  • MOAT was once part of a verification triopoly with DV and IAS but didn’t continue innovating after the acquisition and seems to have missed the brand safety boat almost entirely.

  • Grapeshot should have been thriving given the rise of contextual, but also not an area where we’ve heard any innovation. Also I believe (correct me if I’m wrong) they tied Grapeshot tightly with MOAT both technically and commercially, so hard to unwind.

I’ve heard from multiple parties that Oracle is not looking to sell the business, they would rather take their toys and go home.

This reminds me of a funny story I heard about the BlueKai acquisition. Apparently, BlueKai was very dog-friendly. And the nice people at Oracle, especially the super nice attorneys who work there, hate dogs. So literally the first day after the acquisition there was a de-dogging effort throughout BlueKai offices. That’s what you call a culture clash.

Equativ and Sharethrough “merge”

Equativ (formerly Smart) and Sharethrough have agreed to merge. This is the type of consolidation everyone has been talking about for years. Not done out of desperation or capitulation, this is a straightforward deal where two market participants combine to give the combined company more scale.

Equativ gets a much stronger position in the US. While the company has been in the US market for some time, they have few ad serving customers in this market, and the SSP is certainly on the smaller side.

Sharethrough is just a couple years post their merger with Canadian-based DistrictM, and has been working hard to move beyond their traditional niche as a native SSP (not everyone can be worth over a billion in that niche, lol).

Mazel tov to everyone involved, we want to see more of this.

Editor’s note, we have made out Marketecture interviews with both Equativ and Sharethrough free for a limited time.

MadHive buys Frequence

MadHive is using that green, green Goldman money to Get Big. Fast.

MadHive is a largely misunderstood company, and may remain so after this deal closes, but I’ll do my best. Until recently their core business was a bidding system they sold to media companies for audience extension. Big media companies, like many of the traditional MVPDs have big salesforces selling media (primarily linear TV) to local advertisers. To sustain that business in the face of audience declines, they need to find inventory outside of their traditional medium.

So MadHive’s revenue mostly comes from big media companies whose ultimate customers are local and regional advertisers like dry cleaners and car dealerships. With that in mind, Frequence seems to fit in two ways. First (and I’m reading between the lines here) it may allow the sellers at these media companies to build better cross-media plans. Second, it may be part of a move by MadHive to offer a product directly to some of those regional advertisers (or for MadHive to let its customers offer this to their customers). Either way, the insight is that these regional advertisers aren’t super sophisticated and likely buy mostly video.

Big private ad tech companies

One thing that Eric noted on the pod is the statement that the combined MadHive now has 600 employees (!), which puts it among the larger scaled non-public ad tech companies.

Just for fun, let’s build a quick list off the top of our head of the largest private ad tech companies (and their majority owner) ranked totally non-scientifically:

  1. Mediaocean (CVC)

  2. Yahoo DSP (Apollo)

  3. LiftOff / Vungle (Blackstone)

  4. Cadent (Novacap)

  5. Smartly (Providence)

  6. Simpli.fi (GTCR)

  7. Basis (Private)

  8. Equativ (Bridgepoint)

  9. Index Exchange (Private)

  10. MadHive (Goldman Sachs)

Did I miss anyone?

Editor’s note: Most of these companies have been interviewed on Marketecture.tv, so if you’re a subscriber you can Get Smart. Fast.

Reading list

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