There probably isn’t a more cluttered and confusing part of the media marketplace right now than the technology supply chain. Check out this Lumascape-like chart making the rounds this week.
But the suppliers who are succeeding most are the ones that are not making things more complicated, but making it easier for people to buy, sell and trade media more efficiently and based more on the outcomes they are trying to achieve. One of them is Centro, a scrappy tech supplier servicing the mid-tail of the media buying world -- the smaller, regional and mid-size agencies not affiliated with Madison Avenue’s big agency holding companies that always seem to command so much of the industry’s attention.
Centro has done that by old school blocking and tackling and focusing on the removing as much of the friction for smaller agencies to transition to a digital media-buying world as possible. It did most of that by boot-strapping and a decent $22.5 million capital raise in 2010. This week, it announced a new $30 million round with plans to leverage the capital the way it did its first raise: to acquire businesses that help it grow and diversify what it can do for the middle of the media-buying marketplace.
That’s a pretty important development, because historically, much of Madison Avenue’s innovation happened because the big shops made it so, or hollered loud enough to make Donovan, now MediaOcean, and various other suppliers move the marketplace forward.
Centro is doing it by innovating the market first in order to attract new customers. When it leveraged its initial capital raise to acquire self-serve DSP (demand-side platform) SiteScout, it did it because it understood there were a lot of independent players who wanted to manage their own programmatic marketplace bidding. When it launched a new managed service called the Centro DSP last week, it was because it recognized there were a lot of shops -- and some direct advertisers -- who need a little more hand-holding to make that transition.
With $30 million more in his pocket, expect Centro to do more of the same, Founder and CEO Shawn Riegsecker told me after closing the new round with New York-based Neuberger Berman.
“The game is not over with respect to the big holding companies and we fully expect to compete aggressively in that space,” Riegsecker boasted, adding that the next phase of investment and development could attract some of those big fish, but it’s all premised on a pure focus on making media-buying work faster, more efficiently and with the least amount of workflow possible for any agency using its platforms.
Riegsecker wouldn’t say what kind of value the new round puts on privately-held Centro, but he points out that it currently has 600 employees and processes about $400 million in media buys for agencies, mainly in the U.S. and Canada. Not surprisingly, he said the new capital likely will be used in part to expand internationally.
In terms of overall market innovation, he wouldn’t specify what kinds of companies he’s eyeballing, but said they would likely fall into three sectors: