These events matter and are a sign of some real maturity coming to the industry. I’ve watched the ad-tech industry evolve a lot over the past 25 or so years — from the ad-server wars to behavioral targeting; the ascendance of performance; the shift to programmatic; the emergence and growth of digital video and now, the invasion of digital into the TV advertising ecosystem, the belly of the ad beast.
Yes, in the broad scope of the industry, the events of yesterday and today aren’t that big. Rubicon and Teleria have a combined market cap under a billion dollars, and Eyeview was only 100 or so people (not that that is any consolation to those really talented, pioneering folks and their families who were impacted. I’m hopeful that they will find new roles soon).
The merger of 12-year-old Rubicon and Telaria, the successor to Tremor Video, a digital video company launched 14 years ago, brings together two long-time industry players in very complementary parts of the market, helping digital publishers maximize the value of their inventory and serving and managing video ad inventory for sellers.
Thirteen-year-old Eyeview was early to digital video ad tech and, according to reports in the trade press, ran into trouble zig-zagging a bit over the past few years determining how to best position itself in the programmatic-centric world that is taking over most of digital advertising.
Okay, so then why are these two pieces of news a harbinger of an industry’s maturity? Here’s why:
A merger of tenured industry players where 1+1=3+. All too often, mergers of smaller companies that share adjacency in the market and each have real tenure are all about cost savings and some sense of Hail Mary that something special might come of it. Not so here. I know enough about the market, the companies, their products, their leaders and their teams to know this is a merger where real positive value and growth multiplication is very likely to result.
Many significant longer tenured companies that never got real traction are now going away, such as Eyeview and others before it — IgnitionOne last week, Videology last year.
A problem with ad tech is that for a significant period of time — from the mid-‘00s until a few years ago — there was a lot of venture capital available. That money has dried up, so we are going to see many more companies go away, consolidate or shrink. It will simplify the market, the solutions and remove a lot of noise. Hard on those adversely impacted, but good for the industry overall.
Great leaders involved in all. From Michael Barrett at Rubicon to Mark Zagorski at Telaria to Oren Harnevo, then Rob Deichert, at Eyeview (to Will Margiloff at IgnitionOne and Scott Ferber at Videology as well), the leadership at these companies is/was really strong. This is not a question of having more companies than there are great leaders to lead them. This is about great leaders making the decisions that they have to make to go forward. That is real maturity.
What do you think? Is ad tech growing up?