real-time bidding in online...

REAL-TIME BIDDING IN ONLINE ADVERTISING

THE DEATH OF THE MAD MEN

The big bang of online advertising is taking place right now

Just as the financial sector transitioned from trading via hand signals and slips of paper

to automated buying and selling, Real-Time Bidding (RTB) is rapidly transforming the

online advertising market, by enabling automated and transparent trading of display

inventory, eyeball by eyeball.

Efficiency gains driving substantial market growth

Both buyers and sellers will ultimately benefit from efficiency gains and we expect as a

result that online advertising will steal a greater share of the advertising pie than

previously anticipated. Global RTB ad spend is expected to grow at over 50% per

annum to over $20 billion in 2017.

On the cusp of the next market phase – the ramp-up to mass market adoption

Over $1.3 billion has been invested into RTB platforms with over half of this in the last

two years. With the infrastructure now in place, we expect that online display sales via

RTB could increase towards 50% of the market in the US over the next 5 years, with

key Western European economies catching up quickly.

Europe currently lags behind the US but could benefit the most

Europe is a fragmented digital media market, but RTB enables advertisers to efficiently

buy across publishers audiences in different geographies and languages. While US

entrants are first movers in scalable tech platforms, we see a significant opportunity for

customised technology, data analytics and service layers in Europe as the ‘one-size fits

all’ platform technologies commoditise. We expect European RTB penetration rates will

start to catch up with the US and that Western Europe could see RTB ad spend reach

$4bn in 2017.

Data is king, but not all data is made equal

The availability of quality data is key on both sides of the market. Advertisers that can

leverage their first party data will have an advantage over those reliant on third party

data sources, whilst publishers that use data to better understand their audience will be

able to maximise their yields.

Mobile and Video are key drivers of growth

Mobile RTB is exploding due to the rich data now being provided on users and

significant investments in tracking technology. Video RTB is also growing rapidly and

cross device campaigns will have a significant impact on the landscape as brand

advertisers adopt RTB as a method of delivery.

Consolidation is coming

As RTB now ramps up to mass-market adoption, and increasingly well-funded RTB

players jockey for position, we expect to see a wave of consolidation. M&A will be

driven by the need for scale, customers, multi-channel capability, internationalisation

and late entrants acquiring RTB expertise.

INDEPENDENT TECHNOLOGY RESEARCH SECTOR UPDATE NOV 2013 DIGITAL MEDIA

SIMON NICHOLLS [email protected]

London: +44 207 101 7574

ALISTAIR MALINS

[email protected] London: +44 207 101 7587

MALCOLM HORNER

[email protected] London: +44 207 101 7573

Important disclosures appear at the back of this report

GP Bullhound LLP is authorised and regulated by the Financial Conduct Authority and the Prudential Regulation Authority

GP BULLHOUND – REAL-TIME BIDDING: THE DEATH OF THE MAD MEN

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Table of Contents

INTRODUCTION .................................................................................................................................. 3

The ‘Big Bang’ of the advertising marketplace...................................... 3

RTB is driving huge efficiencies in the ad marketplace ........................ 3

Benefits to both buyers and sellers can drive the overall market .......... 3

The ‘Rise of the Machines’ ................................................................... 3

The ‘Death of the Madmen’? ................................................................ 6

TECHNOLOGY AND APPLICATIONS ................................................................................................ 7

How does RTB work? ........................................................................... 7

It’s all about the data ............................................................................ 7

Cookie monsters ................................................................................... 7

Not all data is created equal ................................................................. 7

Demand Side Platforms ........................................................................ 8

Agency Trading Desks ......................................................................... 9

The ‘Publisher’s Dilemma’ .................................................................. 10

Sell Side Platforms ............................................................................. 10

Private Exchanges .............................................................................. 11

A DYNAMIC GLOBAL MARKET ....................................................................................................... 13

Key geographies in focus ................................................................... 15

NEW MARKETS AND TECHNOLOGIES ........................................................................................... 19

Mobile: real-time location-based advertising....................................... 19

Video advertising: the big prize for RTB ............................................. 21

CAPITAL INVESTMENT AND CONSOLIDATION ............................................................................ 23

Investment into RTB ........................................................................... 23

Venture and growth capital ................................................................. 23

Europe in focus ................................................................................... 24

Recent IPOs and potential candidates for the future .......................... 25

M&A and consolidation in the sector .................................................. 26

Where next for M&A? ......................................................................... 27

APPENDICES .................................................................................................................................... 28

GP BULLHOUND – REAL TIME BIDDING: THE DEATH OF THE MAD MEN

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INTRODUCTION

The ‘Big Bang’ of the advertising marketplace

The ‘big bang’ of the advertising market place is taking place right now in real-time bidding for online and

mobile display inventory.

Real-time Bidding (or RTB) is an automated method of buying digital-display advertising in real-time via an

auction between buyer and seller on an Ad Exchange for individual impressions eyeball-by-eyeball. Our

report focuses on RTB and also address the wider programmatic buying market where trades can be

automated but not necessarily in real-time or on an impression-by-impression basis.

Not that long ago the Square Mile and Wall Street transitioned from trading via hand signals and slips of

paper to automated buying and selling. The online advertising market has undergone a similar

transformation in recent years. Up until relatively recently, online advertising has been bought and sold in a

surprisingly similar way to traditional media. The norm was for agreements in advance to acquire

packages of ad inventory based on limited data about the actual audience that will see the ads. However,

trading in online inventory via RTB is now becoming increasingly automated, liquid, transparent and

efficient as RTB gains momentum in both web and mobile advertising.

RTB is driving huge efficiencies in the ad marketplace

With substantial advances in liquidity, as more publishers adopt RTB, and in the sophistication of ad-

trading platforms, advertisers are gaining the ability to assess and reach their target audience far more

effectively than ever before.

Real-time audience data including location, age, gender and so on, married to real-time pricing, provides

greater transparency in the underlying market. Through impression-level real-time auctions, advertisers

are coming closer than ever before to solving the conundrum of knowing what half of their advertising

money is being wasted. By transitioning from manual media buying to automated or programmatic

platforms, participants are also able to recognise significant cost efficiencies.

Benefits to both buyers and sellers can drive the overall market

Whilst there will initially be losers as well as winners, ultimately buyers and sellers of online advertising

should both benefit from a more efficient marketplace.

The benefits to advertisers are widely recognised and Demand Side Platforms (or DSPs) have proliferated

to drive this side of the marketplace. Publishers, in particular ‘premium’ publishers, have been more

reluctant to accept RTB, but Sell Side Platforms (or SSPs) have helped overcome initial barriers and drive

wider adoption. In our view these new online advertising models will further the transition from offline to

online, with online stealing a greater share of the advertising pie than perhaps previously anticipated.

The ‘Rise of the Machines’

RTB has grown rapidly in a relatively short period of time. The landscape emerged in the early noughties

as publishers increasingly moved audiences online and sought to monetise their digital inventory (or

impressions) via display advertising. Initially this was all done manually by hard-coding ads onto the

publisher’s sites and the whole landscape was slow, inefficient and difficult for advertisers to navigate.

With technological advances in ad serving, Ad Networks soon emerged to aggregate inventory from

publishers and sell it on to advertisers. They would deliver ad impressions through a centralised Ad Server

responding to a website once a page is called. However, advertisers would need to manually optimise and

4 GP Bullhound LLP

rate the performance of their ads based on the responses they received. They had a limited understanding

of the audiences they were accessing and, as a result, the success of their campaigns couldn’t be

measured in a very reliable manner.

Ad Exchanges eventually emerged as tech-enabled marketplaces allowing the trading of ad impressions

between buyers and sellers in real-time. The first large Ad Exchange was launched by RightMedia (now

part of Yahoo) and matched buyers and sellers with a bid and ask much like you would on a stock

exchange. DSPs emerged soon after, allowing advertisers to acquire this inventory in increasing scale and

in real-time using programmatic bidding strategies.

Initially RTB was limited to lower quality inventory as premium publishers were mindful of potential erosion

in CPMs (see The ‘Publisher’s Dilemma’). It wasn’t, however, until SSPs became widespread that

publishers were able to actively manage their ad inventory and the market started to see significant

growth. SSPs are now providing much needed inventory and liquidity to stimulate growth in the underlying

market.

F I G U R E 1 – E V O L U T I O N O F RTB

Source: GP Bullhound

The landscape has become increasingly sophisticated with significant growth in the number of DSPs and

the increasing adoption of SSPs by mainstream publishers. Media trading has evolved towards RTB as

advances in technology have allowed the matching of buyers and sellers in a matter of milliseconds, with

billions of ads traded every day. RTB has rocketed in popularity as advertisers have sought to bypass the

‘black box’ of the Ad Networks, which have historically occupied a profitable niche in the value chain by

arbitraging between buyer and seller in an inefficient market. Figure 2 illustrates the perceived value

leakage historically due to the number of intermediaries between buyer and seller in the market.

Initial development of RTB

technology through growth of Ad

Exchanges

Development of initial DSPs to

serve advertisers (e.g. [X+1], Turn)

2000-2006 2007-2010 2011-2013 Soon

Early Tech Buy-side Growth Supply-side Growth Mainstream Adoption

Proliferation of DSPs as advertisers

look to take advantage of

technological advances

“Publisher’s Dilemma” limits the

availability of premium inventory

SSPs emerging but RTB focused

on non-premium inventory

Mass-market liquidity starting to be

provided by SSPs

Premium publishers adopt RTB

and programmatic sell-side

techniques as they seek to

preserve and optimise yields

Initial growth in Direct

Programmatic sales channels

Growth of new channels as mobile

and video formats standardise

First IPOs (e.g. Rocket Fuel,

Criteo)

RTB starts to ramp to mass-market

adoption and multi-channel in

Europe as well as US

Industry consolidation as multiple

ad-tech platforms scale and late

entrants to the market acquire

capabilities

IPOs and exits for major DSPs,

SSPs and tech providers

Non-RTB ad networks and ad-tech

intermediaries suffer from pricing

pressure and lack of growth

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F I G U R E 2 – V A L U E L E A K A G E I N T H E D I S P L A Y A D V E R T I S I N G MA R K E T

Source: IAB (2010)

Despite the disintermediation of some of the Ad Networks by RTB platforms forcing them to rethink their

business models, the landscape remains bewilderingly complex with many intermediaries remaining

between publishers and advertisers. Although there is more transparency in the system, many participants

are still acting like Ad Networks and arbitraging between buyer and seller. We only see this as sustainable

where real competitive advantage has been created and a clear ROI for advertiser and/or publisher is

being demonstrated.

Figure 3 shows a basic summary of the RTB ecosystem and examples of some of the key players with the

flow of advertising dollars running from left to right.

F I G U R E 3 – T H E RTB E C O S Y S T E M , I L L U S T R A T E D W I T H S E L E C T E D P L A Y E R S


$5.00

$1.80

$0.50

$2.00 $0.25 $0.35 $0.10

0.00

1.00

2.00

3.00

4.00

5.00

6.00

Advertiser Agency Ad Network DataProvider

Ad Exchange Ad serving /Rich Media

Publisher

SSPs

Ad Exchanges

Ad Networks

DSPsTrading Desks

Data Partners Retargeting Optimisation Tools

AD

VE

RT

ISE

RS

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The ‘Death of the Madmen’?

So will RTB cause the ‘Death of the Madmen’? Well it’s clear these developments are driving greater

efficiency in the system at the expense of human-based interaction. Advertisers are increasingly relying on

independent specialists (e.g. Infectious Media, YD), agency trading desks (e.g. Xaxis, Accuen) or even

buying in their own talent to run programmatic buying strategies. There will always be a need for strategic

thinking in the direct sales force but as the ecosystem becomes increasingly connected we anticipate that

the majority of global online display advertising will eventually be traded programmatically with more than

50% via RTB.

We’re anticipating a step-change in the industry as more and more devices are connected to the mobile

Internet and IP Connected TVs and outdoor displays deliver customised ad formats at the right time, to the

right person in the right location. Mobile and video RTB are exploding as more inventory is pushed towards

Ad Exchanges and increasing amounts of premium inventory are traded programmatically. We’re not quite

there yet but the era of data-led marketing is dawning. Don Draper take note. The marketing geeks will

inherit the earth.

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TECHNOLOGY AND APPLICATIONS

How does RTB work?

The market for RTB is facilitated by a series of transactions which take place in fractions of a second

between the time you click on a link to a website and when the page loads onscreen. Online users

generate data about their browsing history and preferences which can be recorded using cookies and

shared with third parties. This data can be used in isolation or combined with additional data (whether

owned or bought) to determine whether an advertiser wants to target that user with an ad and how much

they want to pay to do so. Where impressions are made available via an Ad Exchange, advertisers can

place bids on these impressions based on specific criteria including not only cost, but, age, location,

gender and so on. The highest bidder for an impression gets the placement so the quality and accuracy of

data is key to ensuring the right price is paid.

It’s all about the data

RTB enables marketers to apply algorithmic buying strategies in their purchasing decisions. Rather than

accessing an audience en-masse via a publisher or network using large bulk ordering and broad targeting

parameters, RTB technologies allow a buyer to pick and choose impressions as they come in. A key

benefit of this is the ability to learn, optimise and change a campaign instantly through a programmatic

buying strategy. A large portion of RTB spend is based around such strategies using proprietary first party

data alongside data acquired from third parties or picked up from cookies.

Cookie monsters

Cookie data is intrinsically important to the RTB process. By using cookie IDs advertisers can find out if

that user has recently been on the publisher’s site, how often and where they have visited. The cookie

data can be combined with other information about the user from third party data sources (e.g. Experian,

Callcredit) as well as with their own first party customer data allowing for highly targeted programmatic

trading strategies. Advertisers can also match this with cookie data generated from recent campaigns so

that, for example, they have an indication of whether that user has clicked on a particular advert in the

past. As a result, Data Management Platforms (or DMPs) have emerged to help advertisers merge and

manage data in large volumes in order to make better buying decisions. Publishers are also increasingly

using third party data providers and DMPs to better understand the value of their inventory.

Not all data is created equal

Views diverge, but arguably the most valuable data to advertisers currently is their own first party customer

data. For example, when targeting an audience with a particular campaign incorporating first party

customer data will ensure you’re not targeting individuals that are already customers with offers that they

already have and that existing customers can be targetted with offers that are relevant on past behaviour

or buying patterns.

Cookie data declines rapidly in value, often in the space of a couple of days, as it becomes obsolete as

soon as users refresh their browser history. Proprietary customer data is more valuable as it has a much

longer effective shelf life than cookie data, which is based on media inventory that is burned through

relatively quickly. There is then a raft of third party data available, some of which can be very valuable, but

one issue is that the real value of much of this data is often not transparent until it has been applied at

scale, tested and learned from.

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Demand Side Platforms

DSPs allow advertisers to use data to target their desired audience more effectively using algorithims to

optimise buying strategies and bid on the most relevant impressions, at the right time, in scale and across

multiple devices, formats and properties. DSPs interface with inventory sources like Ad Exchanges to

provide advertisers with the ability to run programmatic bid strategies.

There are three key characteristics of a DSP that determine its value to advertisers:

(i) Usability – all about the functionality and ease of use of the software user interface for the

advertiser or agency;

(ii) Reach – the extent and breadth of acess to media sources (whether desktop, mobile or video); and

(iii) Data – integration with data providers and applications that can assist with programmatic buying

strategies.

We see DSPs as broadly split between two types: the first is a one-size-fits-all interface that is all about the

scale and breadth of both media and data integrations. The other is a specialist DSP offering a customised

interface with deep first party data integration for its clients. The former approach requires scale to

succeed and is exemplified by large players such as Turn, MediaMath, and AppNexus that operate a

‘platform approach’ and are increasingly looking to offer an end-to-end solution across the stack. The

specialist DSP approach involves building bespoke buying platforms to satisfy individual client or industry

segment needs with a more significant managed service layer on top, and has been successfully

championed by European players such as Infectious Media in the UK and YD in the Netherlands. The

rationale is that not only does this allow valuable first party data to be fully utilised but the third party data

integrations and tools provided can focus on specific data sets relevant for optimisation in certain

industries (e.g. online travel). While arguably less scalable, this model has the benefit of significant

integration and ‘stickiness’ with its clients.

The implication for the ‘platform approach’ is that DSPs that don’t achieve scale or offer technology across

the stack will struggle to succeed due to increasing competition and the commoditisation of the technology

over time. The DSP arena is becoming a relatively crowded space and this report lists more than eighteen

significant players that are already operating in Europe (see Figure 15). The fragmented European market

will ensure smaller localised platforms with local media sources and data integrations will be able to

compete with the larger US entrants on local ground.

Figure 4 illustrates the dominance of the larger DSPs in the US market with the top three commanding

50%+ of the market. It also indicates how quickly things can change with a significant fluctuation in market

share over the course of just two quarters.

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F I G U R E 4 - DSP M A R K E T S H A R E B Y S P E N D (US)

Source: Casale Media Index (2013)

Agency Trading Desks

The first agency trading desks emerged as Ad Exchanges became common place, providing access to

inventory in greater scale and with greater transparency. The trading desks have reduced the inefficiencies

in the complex and costly task of media planning and buying, by pooling consumer and media data at

scale and using sophisticated analytics to execute more ‘informed’ trades.

The major global agencies (e.g. WPP, Publicis, Omnicom, Dentsu/Aegis, Interpublic) have all developed

agency trading desks (Xaxis, Vivaki, Accuen, Amnet, Cadreon) to aggregate their RTB activities. Earlier

this year, Maurice Levy, CEO at Publicis, highlighted the importance of economies of scale in media

buying as a strong rationale for the proposed Publicis/Omnicom merger. If the ‘Publicom’ merger

completes, the combined entity could represent up to 40% of digital media volumes (according to RECMA)

which could provide a meaningful competitive advantage. However, some industry participants think that

there is a potential conflict of interest as the global agencies act simultaneously as both buyers and sellers.

Since the trading desks earn a margin on CPMs, whilst the media agencies earn volume-based rebates,

this has also led to concerns in some quarters over the pricing dynamic. Trading desks claim that such

issues are more perception than reality.

Another interesting trend is that some very large advertisers have started to set up their own trading desks

(e.g. P&G, Unilever) and are now competing with the agency trading desks for talent to build their own in-

house RTB capabilities. The advantages for these ‘super advertisers’ are that they can keep their

proprietary data confidential, reduce costs (which for large media campaigns can be significant) and take

ownership of the media data produced via each campaign. While most advertisers will not want to invest in

an in-house capability in a market moving so rapidly, the desire for retention and protection of proprietary

data is a factor that could play into the hands of the independent trading desks and specialist DSPs with

real expertise in data-driven buying. This could in turn provide a counterpoint to the power and scale of the

big agency trading desks.

DSP 135%

DSP 213%DSP 3

12%

DSP 411%

DSP 57%

DSP 66%

DSP 74%

DSP 84%

DSP 94%

DSP 101%

Other3%

Q1 2013Q1 2013

DSP 121%

DSP 217%

DSP 313%

DSP 412%

DSP 57%

DSP 67%

DSP 76%

DSP 85%

DSP 94%

DSP 103%

Other6%

Q2 2013Q2 2013

Top 3 DSPs = 60% of market

Top 3 DSPs = 51% of market

10 GP Bullhound LLP

While a number of larger US-based players are focusing on providing technology at an industrial scale

there is likely to be real value created by specialist RTB service providers aiming to get the most out of the

available technology for their clients. We expect to see strong growth for tech-enabled service providers

that focus on customised data integrations and analytics to differentiate from one-size-fits-all tech

providers.

The ‘Publisher’s Dilemma’

In contrast to the push from a fully data-enabled demand side keen to utilise the power of RTB, many

publishers have initially been reluctant to release their inventory into the market for fear of declining CPMs.

While publishers have been quick to use RTB to improve the yield on their tier 2/3 inventory, their concern

in relation to tier one inventory has primarily been around erosion of CPMs and, particularly for premium

publishers, brand safety from undesired advertisers buying inventory on their site.

Arguably, premium publishers have historically benefited from a less liquid and transparent market that

allowed them to bundle and sell large chunks of their inventory at premium prices. One of the risks of

impression-level buying is that buyers will ‘cherry-pick’ the best inventory and leave some audience as

remnant that was hitherto sold as premium. As a result large swathes of inventory have been witheld from

these markets, decreasing liquidity from some key media sources. This is now starting to change, thanks

in part to the development of SSPs, Private Exchanges and Direct Programmatic Sales.

Sell Side Platforms

SSPs first emerged to help to improve the ability of publisher’s to categorise, segment and sell their ad

inventory via Ad Exchanges and maximise CPMs. SSPs provide software that analyses and categorises

the publishers properties to better understand audience data and actively manage and optimise the yield

on their ad inventory in an automated (or programmatic) way, just as DSPs do for advertiser buying

strategies.

The key battleground today is over the source and analysis of data with ownership of rich audience data

providing a significant advantage for publishers. Advertisers are willing to pay a premium for transparency

and rich data as illustrated by Figure 5 which shows that inventory sold with cookie and third party data

can command a premium of up to twice that sold without. This bodes well for data-rich sellers (e.g.

Facebook) who control access to, and have a high degree of understanding of, their audiences.

F I G U R E 5 – P R E M I U M P A I D F O R T R A N S P A R E N C Y

Source: Cookie State (2013), cited in Casale Media Index (2013)

100

78

51

Cookie & 3rd Party Data Cookie & No 3rd Party Data No Cookie

Winning bid price index

11 GP Bullhound LLP

Through algorithmic analysis of audience data, SSPs help publishers determine which channel their

inventory should be sold through, whether it be actively through direct sales, via a private exchange or

RTB exchange or passively through an Ad Network in order to optimise the yield of the portfolio (see

Figure 6).

F I G U R E 6 – M A R K E T P L A C E S I N T H E RTB E C O S Y S T E M

Source: PubMatic (2011)

Private Exchanges

Private Exchanges have played a key role in the publisher adoption of RTB as they enable publishers to

sell their inventory programmatically but with a greater element of control over the marketplace. Private

Exchanges (or Private Marketplaces) allow publishers to make a portion of their inventory available to a

restricted set of advertisers and to set controls on pricing (e.g. pricing floors). By controlling these

parameters and participants in the market, publishers can better protect pricing of their premium inventory

and optimise yields.

As a result, the lines between direct and indirect sales are beginning to blur. The distinction is becoming

less about premium inventory versus remnant inventory, and more about active selling versus passive

selling.

IDC estimates that 1% of global premium ad revenue was traded in Private Exchanges in 2013. Figure 7

illustrates the slow initial growth of ‘Direct’ RTB sales in comparison to the more mature ‘Indirect’ sales

market, with rapid growth expected over the next four years. The majority of growth in the market over the

next four years will come from ‘Direct’ sales executed programmatically as the market matures and

becomes more sophisticated.

SPONSORSHIP SALES

PRIVATE EXCHANGES

REAL-TIME BIDDING

REMNANT AD NETWORK

PA

SS

IVE

SA

LE

S Au

ctio

n

Pro

gra

mm

atic

AC

TIV

E S

AL

ES

Ab

ove

th

e A

uctio

n

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F I G U R E 7 – ‘ I N D I R E C T ’ V S ‘D I R E C T ’ RTB -B A S E D O N L I N E D I S P L A Y S A L E S I N F O U R K E Y

G E O G R A P H I E S ($ M )

Source: IDC (2013), Excludes Mobile and Video RTB and includes US, UK, Germany and France

Figure 8 illustrates the emerging publisher models as they progress towards RTB adoption across all of

their inventory. In phases four and five we see increasingly smart, multi-channel sales techniques as

publishers increasingly adopt RTB technology and more multi-channel active management of their

inventory.

F I G U R E 8 – P U B L I S H E R A D O P T I O N C Y C L E

Source: Forrester 2011

- - 39 95368

1,085

2,625

5,305

2010 2011 2012 2013 2014 2015 2016 2017

UK France Germany US

144%

148%

157%

176%

2013-17 CAGR 174%

'Direct' Display Sales

390

1,259

2,258

3,338

4,128

4,777

5,317

5,790

2010 2011 2012 2013 2014 2015 2016 2017

15%

13%

18%

15%

2013-17 CAGR 15%

'Indirect' Display Sales

Publisher RTB Maturation Spectrum

Phase 1: No active publisher participation

Phase 2: Publisher incorporates multiple RTB vendors into monetisation partner suite

Phase 3: Publisher consolidates vendor strategy and executes private deals and/or sales with arbitrary price floors

Phase 4: Publisher actively manages smart, variable price floors informed by data; managed by strategic team within publisher organisation

Phase 5: Publisher looks holistically at all sales channels and optimises yield across both direct and indirect/RTB sales channels

Current models

Emerging models

13 GP Bullhound LLP

A DYNAMIC GLOBAL MARKET

Global spend on online display advertising via RTB was estimated by IDC to be $2.7bn in 2012 and is now

expected to grow at a 50% CAGR between 2012 and 2017. Global growth has been significant in the last

three years averaging 159% per annum 2010-12. This is significantly above growth rates forecast in the

global online display advertising market. This growth is principally being driven by three key areas:

Growth of online display – Online display is forecast to grow at a CAGR of 19% 2012-171 and

RTB will ride this wave.

Online Mobile and Video – Mobile and Video RTB ad spend are both forecast to grow at around

or in excess of 100% p.a. over the next few years across the US, UK, France and Germany, as

smartphone penetration rates continue to rise and 4G network speeds aid rapid video streaming.

This will drive further RTB-traded inventory.

Publisher adoption – Increasing adoption of programmatic selling by publishers via SSPs and

Private Exchanges (see Figure 8).

F I G U R E 9 – G L O B A L RTB D I S P L A Y A D V E R T I S I N G MA R K E T ($ M )

Source: IDC (2013), Includes Rich Media, Mobile and Video display

1 IDC (2013)

404 1,382

2,697

4,488

6,726

9,865

14,498

20,820

2010 2011 2012 2013 2014 2015 2016 2017

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F I G U R E 10 – G L O B A L RTB D I S P L A Y A D V E R T I S I N G MA R K E T I N C O N T E X T ($ M )

Source: IDC (2013), GP Bullhound (2013)

Figure 10 illustrates the global opportunity in online display, with a global market of $34bn in 2012 and

$80bn by 2017. IDC forecast the $2.7bn of RTB-based ad spend in 2012 will increase to $21bn by 2017.

In 2010, industry estimates2 suggested that around 65% of online ad spend was being retained by

intermediaries between advertiser and publisher. If we assume the same percentage of RTB ad spend is

retained as net revenue by RTB platforms and service providers then the market share for these players

was around $1.8bn in 2012. If we estimate that the percentage retained by intermediaries will then

decrease to 50% in 2017, as greater efficiencies are generated between publisher and advertiser, then

consequently the market size for intermediaries would be approximately $10bn globally in 2017.

2 IAB (2010)

Global RTB Display Ad Spend

$80bn

$34bn

2012 2017

$1.8bn

$10bn$2.7bn

Global Share of RTB Display Ad Spend taken by intermediaries

Global Online Display Ad Spend

$21bn

15 GP Bullhound LLP

Key geographies in focus

F I G U R E 11 – US RTB D I S P L A Y P E N E T R A T I O N F O R E C A S T S

Source: eMarketer (Aug-13), IDC (2013)

Forecast penetration rates can vary significantly between industry experts. IDC and eMarketer both

estimate penetration of RTB as a percentage of overall display in the US to be 19% in 2013 but forecast

29% and 41% respectively in 2017. Magna Global recently forecast an RTB display penetraton rate of

52% in 2017 for the US3, reflecting increasingly bullish views on the potential of RTB. If the current trend in

publisher adoption continues we can foresee the UK reaching similar levels (i.e. 40-50%) over the next five

years.

F I G U R E 12 – RTB D I S P L A Y A D V E R T I S I N G B Y G E O G R A P H Y ($ B N )

Source: IDC (2013) Includes Online Display, Mobile and Video

As the largest market worldwide, the US has the highest penetration rate for RTB, as a percentage of

online display advertising. Higher growth rates in Western Europe and the Rest of World illustrated in

Figure 12 indicate these markets are starting to catch up with the US. The UK is considered the leading

geography for RTB in Europe, with the remainder of Europe also experiencing rapid growth rates and

rising penetration.

3 Magna Global (2013)

13%

19%

22%

25%

28% 29%

14%

19% 23%

28%

34%

41%

2012 2013 2014 2015 2016 2017

eMarketer IDC

0.4 1.4

2.7 4.5

6.7

9.9

14.5

20.8

2010 2011 2012 2013 2014 2015 2016 2017

ROW Western Europe US

58%

54%

49%

2012-17 CAGR 51%

16 GP Bullhound LLP

F I G U R E 13 – E U R O P E A N RT B A D S P E N D A N D P E N E T R A T I O N

Source: IDC (2013)

With growth at over three times that of the overall online display market, European RTB penetration is

forecast to increase dramatically over the next four years as the fragmented media landscape provides a

long tail of inventory ripe for monetisation. The fragmented and disparate market of publishers and

advertisers in Europe makes for substantial potential cost savings from consolidation onto public

exchanges. RTB opens up the opportunity to buy inventory across multiple geographies and languages in

real-time and for advertisers to target pan-European consumers based on relevance.

1%

3%

7%

11%

13%

17%

22%

27%

2%

5%

12%

15%

17%

22%

27%

1%

6%

8%

14%

17%

20%

25%

30%

2010 2011 2012 2013 2014 2015 2016 2017

France Germany UK

0.0 0.2

0.4

0.7

1.1

1.5

2.3

3.3

2010 2011 2012 2013 2014 2015 2016 2017

UK Germany France Rest of Western Europe

46%

72%

50%

2012-17 CAGR 54%

49%

17 GP Bullhound LLP

We see significant potential in Western Europe for further growth in RTB as publishers adopt RTB-enabled

trading technologies from the US and drive more inventory into the system. We can see a potential ‘upside

case’ for penetration rates in the UK, France and Germany where they start to catch up with those in the

US and reach 30-40% in the next few years, as premium ‘direct’ sales take off and mobile and video RTB

start to gain traction. This will likely be lead by the UK, which has already demonstrated its propensity to

adopt advertising technologies and catch up and even overtake the US in digital penetration rates. The UK

currently has the highest proportion of digital ad spend as a percentage of total ad spend in Europe4 (40%

in 2012) and this is expected to reach 51% by 2017. France and Germany are expected to increase to

25% and 27% respectively over the same period (currently 18% and 20%) whilst digital ad spend as a

share of total ad spend in the US is expected to increase from 25% to 31%. If we assume the RTB

penetration rates under the ‘upside case’ as set out in Figure 14 below, then this would result in a Western

European market totalling $4bn by 2017.

F I G U R E 14 – E S T I M A T E S O F T H E S I Z E O F T H E E U R O P E A N RTB MA R K E T ($ B N )

IDC Forecasts GPB Upside Case

2017 Penetration (%) 2017 Penetration (%)

UK 1.0 29% 1.4 40%

France 0.4 27% 0.5 32%

Germany 0.6 27% 0.7 32%

Rest of Western Europe 1.2 - 1.4 -

Western Europe 3.3 - 4.0 -

Source: IDC (2013) GP Bullhound.

The UK is the largest market outside of the US and currently represents 38% of the Western European

RTB. IDC forecast the UK RTB market to be worth $1bn by 2017 and 29% of UK display ad spend. The

UK is well-suited to rapid adoption of RTB which is evident in both the number of players setting up in the

UK (Figure 15) and market penetration second only to the US globally. Several large US players have

been attracted by the size of the UK digital market and economy and additionally we are seeing the

emergence of some innnovative UK-born players such as Infectious Media, Switch and Grapeshot.

RTB penetration in Germany has lagged behind much of Western Europe with only 7% in 2012, primarily

due to a legacy of independent direct sales houses. These sales houses have consolidated the number of

buying points for advertisers making it is easier for publishers to sell direct to advertisers than in

otherEuropean markets. As a result there is less of an incentive for publishers to sell off inventory via RTB.

The German market is reaching an inflection point for RTB penetration with RTB-based spending

anticipated to hit $157m in 2013 (an 82% increase on 2012) and a penetration rate of 12%.

France is also growing rapidly with RTB penetration up to 11% in 2013 from 7% in 20125. Local publishers

are staking their claim in the space with the collaborative joint ventures La Place Media which launched in

May 2013 and Audience Square in 2012. The joint ventures provide sell-side services, acting as a form of

4 eMarketer (2013)

5 IDC (2013)

18 GP Bullhound LLP

sales house plugging into the major exchanges and trading platforms. This could be considered a step in

the right direction with regards to RTB adoption in France

F I G U R E 15 – E U R O P E A N RT B MA P – S E L E C T E D P L A Y E R S


Figure 15 reflects the substantial presence of both home-grown and US RTB players in Europe with a

concentration in the larger economies, particularly the attractive UK market.

We see Europe as a hotbed of activity in RTB and, although somewhat behind the US in terms of market

size and adoption, there is potential for rapid expansion of RTB. With large-scale technology infrastructure

for RTB already imported from the US, we expect to see European success stories come from the

application of innovative additional technologies, predictive data analytics and specialised service

providers that generate further optimisation and efficiencies for both buy and sell-side.

Legend

Exchange

DSP

SSP

Trading Desk

Other

Video specialist

Mobile specialist

Norway

3 Opera Media Works

Spain

8 MediaSmart

Denmark

7 Adform

1

1

1

1

1

1

Netherlands

4 161 Media

5 FlxOne

2 Improve Digital

2 YD

UK

1 AdJug (Dentsu)

1 GDM Digital

1 Glow Digital Media

1 Grapeshot

2 Infectious Media

2 Iponweb

3 myThings

3 StrikeAd

1 Switch

4 VisualDNA

Germany

5 Adnologies

2 AdScale

3 RevenueMax

6 Sociomantic

France

6 AdXperience

4 Audience Square

7 Criteo

5 La Place Media

Sweden

4 Admeta

8 Delta Projects

US

9 [x+1]

3 Accordant Media

4 Accuen

5 Adap.tv

5 Amnet

10 AppNexus

9 AudienceScience

6 Brightroll

6 Cadreon

11 DataXu

7 Digilant

7 Doubleclick

8 FBX

9 Liverail

12 MediaMath

6 MoPub (Twitter)

10 OpenX

7 PubMatic

11 PulsePoint

12 Right Media (Yahoo)

13 Rocket Fuel

8 Rubicon Project

13 SpotXchange

10 The Trade Desk

14 Triggit

15 TubeMogul

16 TURN

8 Varick

17 Videology

9 Vivaki

10 Xaxis

1

2

2

3

3

3

3

3

3

3

3

3 14

4

5

2

2

2

2

2

2

5

52

36

6

6

6

64

5

7

7

7

7

7

3

4

8

8

8

8

7

7

7

77

77

7

8

4

4

4

4

4

4

4

4

4

45

5

5

5

5

5

5

10

10

10

9

9

6

6

6

6

6

11

11

11

11

11

11

7

779

12

10

7

7

7

11

12

12

13

13

13

13

13

13

13

8

8

813

10

10

15

16

1616

16

16

17

17

17

9

9

9

9

9

910

Other

18 Brandscreen

15 Casale MEDIA

Google

9 Admeld

14 Doubleclick

11 Invite Media

19 GP Bullhound LLP

NEW MARKETS AND TECHNOLOGIES

Mobile: real-time location-based advertising

Mobile RTB is rapidly gaining traction in the US and is forecast to explode into Western Europe over the

next few years. Smartphone penetration rates in the G5 economies are forecast to top 50%6 this year,

driving an increasing amount of inventory on mobile devices and interest from advertisers in running

mobile campaigns as a result. Smartphones and tablets are generating vast amounts of data about

consumer behaviour which can be used to target an audience, and investment in new tracking

technologies is enabling media campaigns to be executed across multiple devices and targeted in real-

time.

F I G U R E 16 – US M O B I L E RTB S A L E S ( $ M )

Source: IDC (2013)

It is estimated that location-based targetting through mobile is up to 2.3x more effective than the industry

average click through rate (CTR)7. Mobile RTB is a huge opportunity, which is evident in forecast growth

rates over the next few years of over 100% p.a. in the US and nearly 200% p.a. in Western Europe (from a

smaller base), illustrated in Figure 16 and Figure 17 respectively.

F I G U R E 17 – M O B I L E RTB S A L E S I N T H R E E K E Y E U R O P E A N G E O G R A P H I E S ( $ M )

Source: IDC (2013)

The market for mobile inventory is distinctly different from desktop. Cookies aren’t enabled in 90% of

mobile devices so tracking users has been a problem for the industry. A number of tracking technologies

6 Comscore (2013) 7 Verve Mobile (2013)

0.1

0.4

1.1

1.9

3.0

2013 2014 2015 2016 2017

8

62

150

344

549

2013 2014 2015 2016 2017

Germany France UK

191%

191%

170%

2013-17 CAGR 184%

20 GP Bullhound LLP

have now emerged to provide a solution using device fingerprinting and in-app analytics (e.g. Drawbridge,

HasOffers, Ad-X (acquired by Criteo) and Somo’s mobile ad-tech suite).

Most publishers have traditionally lacked scale in mobile inventory so have historically delegated sales to a

mobile Ad Network to aggregate inventory and sell it on their behalf. This is almost a carbon copy of the

online display market in the last decade where there wasn't enough individual reach from publishers to

justify a marketplace. However publishers are experiencing rapidly growing traffic on their properties,

particularly from in-app browsing which is now driving a rapid move into mobile RTB.

The few companies that have the scale and cross-platform user base to be able to track across devices

using login details (e.g. Facebook, Twitter and Apple) are also at a competitive advantage as their vast

collection of rich audience data across channels drives higher CPMs, and therefore mobile ad revenues.

Facebook and Google top the US display advertising revenue charts and the FB-X (Facebook’s Ad

Exchange) is becoming a de facto destination for sophisticated mobile RTB campaigns. The secret sauce

is Facebook’s rich pool of social audience data combined with a mobile first understanding of audience

monetisation which is evident in its explosive growth over just five quarters where mobile has gone from

14% to almost half of Facebook’s ad revenue illustrated in Figure 18.

F I G U R E 18 – F A C E B O O K MO B I L E A D R E V E N U E ($ M )

Source: Company filings (2013), includes all mobile ad revenue

With circa 40% of tablet and smartphone users using their devices when watching television, the potential

reach of the ‘second screen’ is vast. In the US During the last Super Bowl over 100 million people were

estimated to have watched the half-time ads, with tens of millions checking their mobile devices providing

a significant audience for targetted campaigns. We believe the convergence of mobile, locational and

cross-device technologies with the digitisation of the TV and outdoor markets is one of the most exciting

trends in the market

152

306

375

656

882

14%

23%

30%

41%

49%

Q3 2012 Q4 2012 Q1-2013 Q2-2013 Q3-2013

Facebook mobile advertising revenue Mobile % of total ad revenue

21 GP Bullhound LLP

Video advertising: the big prize for RTB

The online video display advertising market is also growing rapidly. Consumers are spending an

increasing amount of time watching online video content, particularly on mobile devices. As a result,

viewer impressions are growing rapidly along with the amount of advertising dollars spent on video ad

inventory. Global online video advertising is expected to reach $3.6bn in 20138, growing at 26% p.a. from

2011 to 20178. Online video represents a big prize for RTB because it has the potential to unlock large

brand advertising budgets into RTB. This is primarily because brands are attracted to rich media formats

which provide a more engaging advertising experience. Video RTB will also be driven by advances in ad

serving technology and investment in the video RTB infrastructure.

F I G U R E 19 – US V I D E O RTB G R O W T H ($ B N )

Source: Forrester (2013)

RTB video advertising spend is greatest in the US, however Europe is expected to catch up, growing at

127% p.a. across UK/France/Germany in the next few years compared with the US at 88%.

F I G U R E 20 – V I D E O RTB A D V E R T I S I N G R E V E N U E F O R S O M E K E Y E U R O P E A N G E O G R A P H I E S ( $ M )

Source: IDC (2013)

Advertisers are increasingly using programmatic trading to buy online video advertising but there is a

reluctance for premium publishers to ‘play ball’. Buyers are seeking video advertising at real-time prices

but, as with standard display formats, publishers are reluctant to allow buyers to ‘cherry-pick’ their

inventory. As a result the market is bifurcating with a split into bid-based public marketplaces for non-

premium inventory and private market places for premium inventory.

8 Forrester (2013)

0.1

0.4

0.8

1.3

1.7

2013 2014 2015 2016 2017

6

30

58

111

152

2013 2014 2015 2016 2017

Germany France UK

138%

131%

109%

2013-17 CAGR 127%

22 GP Bullhound LLP

F I G U R E 21 – B U Y E R M O D E L S F O R B U Y I N G V I D E O A D V E R T I S I N G V I A RTB

Source: Forrester (2013)

Video adtech players (e.g. Liverail) have designed the infrastructure to publish inventory at scale and in

real-time. As a result of these advances, advertisers are now able to reach a targeted, brand-receptive

audience across a wide range of devices. This, combined with social media activity, means RTB can be

used to target an engaged audience in real-time when they are interacting with brands.

Global TV advertising net revenue is forecast to hit $219bn by 20189, and with such high budgets at stake,

IP connected television could drive the potentially game-changing phenomenon of RTB TV advertising in

due course. Why should you be served the same advert in your living room at half time during Manchester

United vs Arsenal, as your neighbour in his?

9 Digital TV Research (2013)

Bid-based Public Market places

• Prevalent among mid-to-long-tail inventory

• Premium publishers testing RTB bids in

competition with traditionally sold inventory

• Pricing being determined dynamically via

bidding

• Optimised based on audience, engagement,

and direct-response metrics

Direct Deals and Private Market places

• Growing among premium publishers as a

way to automate buys and maximise sell-

through

• Pricing being determined through a

combination of pre-negotiated rates and

dynamic bidding

• Optimised based on cost audience reach and

brand survey metrics

23 GP Bullhound LLP

CAPITAL INVESTMENT AND CONSOLIDATION

Investment into RTB

With such a large market migrating to and being enabled by RTB technologies, it is no surprise to see

significant capital inflows into the sector. We estimate over $1.3bn has been invested in RTB over the last

ten years of which more than half has been invested in the last two years alone as the RTB market has

started to gain critical mass and 2013 has seen the IPOs of Criteo and Rocket Fuel (raising a combined

$367m).

F I G U R E 22 – S E L E C T E D F U N D R A I S I N G I N T H E RTB S P A C E ($ M )

Source: Capital IQ, Crunchbase, GP Bullhound Note: Includes Criteo and Rocket Fuel IPOs

Venture and growth capital

DSPs have consistently attracted investment since 2008 with AppNexus ($75m), DataXu ($27m) and

OpenX ($25m) ensuring 2013 is set to be a record year for VC funding. In contrast, SSPs have only begun

to receive really substantial funding in more recent years, with 2012 a record year including a $45m raise

by Pubmatic.

$8

$104

$60 $47

$141

$87

$145

$75

$163

$538

2004 2005 2006 2007 2008 2009 2010 2011 2012 2013

Other Exchange SSP DSP

24 GP Bullhound LLP

F I G U R E 23 –S E L E C T E D P R I V A T E P L A C E M E N T S I N T H E R TB S P A C E F R O M T H E L A S T T H R E E Y E A R S

($ M )

Source: Capital IQ, Crunchbase, GP Bullhound

Only three SSPs have raised substantial (>$10m) capital in total compared with seven DSPs, which may

explain why there is such competition on the demand side as mentioned earlier in this report. Independent

Trading Desks have also gained traction with funders in recent years as investors see value in sectors

outside the now hyper-competitive DSP space, closer to the advertiser data.

Europe in focus

Fundraising in the sector has been dominated by the US players, with significant sums raised to date. It is

notable that over the last four years Europe has seen increased activity relative to the US in terms of

volume of companies funded, up to 35% from 26% of fundraisings by volume (see Figure 24). This is due

to a drop in the number of transactions in the US coinciding with an increase in European volumes,

indicating a maturing of the funding market in the US, whilst Europe has been woken up by the arrival of

well-funded US tech platforms driving wider spread RTB penetration. The average size of fundraising in

the US has been two-and-a-half times that of Europe over the same period.

F I G U R E 24 – S E L E C T E D P R I V A T E P L A C E M E N T S B Y G E O G R A P H Y

$7m Average Raise in Europe 2010-13YTD

$16m Average raise in US 2010-13YTD

Source: GP Bullhound, Capital IQ, Crunchbase

$228 56%

$45 11%

$57 14%

$77 19%

DSP SSP Exchange Other

7% 11%

78% 71%

15% 18%

2004-2009 2010-2013YTD

AMOUNT RAISED

7% 9%

67% 56%

26% 35%

2004-2009 2010-2013YTD

VOLUME OF RAISES

2004-2009 2010-2013YTDEurope US Other

25 GP Bullhound LLP

Recent IPOs and potential candidates for the future

On top of substantial private capital inflows, there have been a number of IPOs in the Ad-Tech space in

recent months. The recent IPOs of Criteo and Rocket Fuel have been well received as their scale,

proprietary technology capabilities, and positioning in the disruptive and rapidly growing RTB market are

seen as key competitive differentiators. Combined, they have raised $367m of capital in 2013 taking the

total capital raised in 2013 to $538m in public and private markets combined.

F I G U R E 25 - R E C E N T A D -T E C H I P O S


The warming of the IPO markets and recent success of Criteo and Rocket Fuel will have been watched

with a keen eye by a spate of other adtech companies in the RTB ecosystem, who may be potential IPO

candidates.

F I G U R E 26 – P O T E N T I A L A D -T E C H I P O C A N D I D A T E S


Adams Street, Bessemer, Elaia,

Fourvest, IDInvest, Index, SAP,

SoftBank , YJ

Private: $60m

IPO: $251m

Leading global retargeting platform

Floated Oct-13 with an offer price of $31 per share, above its

upwardly revised $27-29 range and providing a market cap of

approximately $1.7bn

Share price rose 40% from its debut and was approximately $36 a

share as at 18-Nov-13 and 16% up on the IPO

Northgate, Summit, Cross Creek,

Nokia Growth Fund, Labrador

Private: $77m

IPO: $116m

Leading Demand Side Platform

Floated Sep-13 at a share price of $29 valuing the company at

close to $1bn

Share price doubled in its first week of trading and as at 18-Nov-

13 was $54.20 approximately 90% up on the IPO

Recently Announce / Completed IPOs

Company Investors DescriptionRaised

First Round, Khosla, Kodiak,

Venrock, Microsoft, Tribeca, TCV$140m

Real time ad exchange/deliver system

Rumoured to have been approached by AOL and Microsoft in

Aug-10

Atlas Venture, Flybridge, Menlo

Ventures, Thomvest Ventures$45m

Real-time campaign management platform across mobile and

video channels

Acquired MexAd in Sep-12

Clearstone, IDG, Mayfield,

Standford, Berkeley, Peacock,

Fox

$50m

Sell side platform

Acquired Others Online, SiteScout, Fox Audience Network and

MobSmith

Trident, Scale, Adams Street,

True ventures, Comerca Bank,

KPG

$46m Video ad network and demand side services

Accel, Samsung, Cox Media,

iNovia, Greycroft, Comerica Bank$56m

Audience targeting and data/ media management

Acquired Tumri, OggiFinogi, and Personifi

DPJ, Helion, Nexus, August, SVB $63m

Supply side platform helping publishers automated selling of

inventory

Acquired MobiPrimo and ReviNet

European Founders, QED,

Safeguard, SVB, SJF, Catalyst

Investors

$24m Large scale demand side platform

Acquired TapMe

Norwest, Shastra, Trident, Focus $61m Large scale demand side platform

IPO Candidates

Candidate Investors DescriptionRaised

26 GP Bullhound LLP

M&A and consolidation in the sector

We see an oncoming wave of consolidation in the market which will help to drive a series of transactions

over the next few years. With substantial growth in RTB ad spend still to come, a fragmented European

market and the need for differentiated technologies and capabilities, we believe the market is ripe for

consolidation, which will be a further key driver of scale and efficiency in the market.

F I G U R E 27 – S E L E C T E D M& A V O L U M E I N T H E RTB S P A C E


M&A activity has picked up considerably in the space in the last three years as strategically important

capabilities are acquired (e.g. Twitter’s recent acquisition of MoPub), or as a consolidation play with

players such as Google, AOL and Yahoo looking to own the entire value chain.

F I G U R E 28 - G O O G L E & Y A H O O S H O W I N G A H I G H L E V E L O F A C T I V I T Y

Source: Capital IQ, GP Bullhound

Yahoo and Google have been two of the most active acquirors in the sector in recent years and have been

making a play to own large parts of the value chain given the strategic importance of advertising revenue

to both.

1

7

9 9

11

2009 2010 2011 2012 2013

DSP SSP Exchange Other

27 GP Bullhound LLP

Where next for M&A?

M&A activity has been fairly muted in Europe compared with the US. We see M&A activity picking up with

a number of potential drivers of consolidation:

Scale – as the technology commoditises, additional M&A will be required to leverage efficiencies

from owning the full ‘stack’ of technologies and client data at scale.

Customers – M&A could be driven by the acquisition of customer concentrations and proprietary

technologies in individual verticals (e.g. ecommerce, online travel).

Multi-channel – as the market matures and new high growth areas emerge (e.g. direct, mobile

and video) larger acquirors may look to add to their cross-channel capabilities.

Internationalisation – a key driver to penetrate new markets especially where the barriers to

entry are high or scale is difficult to achieve organically.

F I G U R E 29 – P O T E N T I A L S T R A T E G I C A C Q U I R O R S I N T H E A D T E C H S P A C E

Source: GP Bullhound – Example companies are illustrative only

Potential future acquirors include the following:

Internet Giants – those heavily reliant on ad revenues will look to ensure they have the core

competencies and technology stack in-house. The importance of RTB in mobile advertising was

evident in Twitter’s recent acquisition of Mo-Pub (Sep-13). Google has made a big play on the

space with its acquisitions of Doubleclick, Invite Media and Admeld ensuring it has coverage

across the technology stack. We expect more from the likes of AOL, Microsoft, and Yahoo.

Global Agencies and Networks – we expect the global agencies will look to ensure they are

well positioned in the space and we see them as key potential acquirors. We also expect to see

Ad Networks acquiring technology and skills as the pace of change in the sector continues

unabated, exemplified by Millenial media’s acquisition of Jumptap (Aug-13).

Software providers – M&A activity has been high in the CRM software space with Adobe’s

acquisition of Neolane (Jun-13) and Salesforce’s acquisition of ExactTarget (Jun-13). These

software providers may now look to integrate these platforms with RTB capabilities. The benefits

to such organisations could be big, with a fully integrated RTB-enabled display advertising and

CRM platform, providing a single dashboard for multiple advertising channels.

Consolidation of existing RTB players – in a market with competing technology platforms we

expect to see significant consolidation as business models evolve to compete. Early examples of

this include Criteo’s acquisition of Ad-X (Jul-13), Rubicon Project’s acquisition of mobile

capabilities in MobSmith (Mar-12), and DataXu’s acquisiton of Mexad (Dec-11). We expect to see

mergers and acquisitions of complementary technology capabilities and local customers driving

internationalisation. Finally we see data players (e.g. Experian) as a further key category of

acquirors as they seek to leverage their data assets and analytics capabilities across the

landscape.

Internet GiantsCRM Software

Providers

Global Agencies

& Ad NetworksExisting RTB Players

28 GP Bullhound LLP

APPENDICES

SELECTED COMPANY PROFILES – D E M A N D S I D E

Source: GP Bullhound, eMarketer, Crunchbase, Capital IQ

Rev: Raised:

Employees:

N/A

HQ: New York Founded: 2010

Investors: Privately Held

N/A

50

Independent media trading desk

Display, video, mobile, social, email, in-

stream audio and out-of-home channels

Co-founded by digital agency execs Art

Muldoon and Matt Greitzer

Rev: Raised:

Employees:

N/A


Investors: First Round, Khosla, Kodiak,

Venrock, Microsoft, Tribeca, Crossover

$141m

N/A

Platform for buying real-time online

advertising

Offers a proprietary gateway to premier

ad exchanges and ad inventory

aggregators

Completed $75m series D in May-13

Rev: Raised:

Employees:

N/A

HQ: Boston Founded: 2009

Investors: Atlas Venture, Flybridge,

Menlo Ventures, Thomvest Ventures

$45.8m

N/A

Real-time campaign management

platform for digital advertising campaigns

across online, mobile and video channels

Combines automated media buying,

optimization and analytics

Raised $27m in Series C funding in Feb-

13

Acquired MexAd in Sep-12

Rev: Raised:

Employees:

€30m

HQ: Copenhagen Founded: 2002

Investors: Via Venture Partners

N/A

200

Multiscreen DSP incorporating display

ad serving, rich media, video, mobile,

dynamic ads, personalised targeting,

and real-time bidding through

integrations with major inventory

players

Rev: Raised:

Employees:

N/A

HQ: Paris Founded: 2009


N/A

N/A

Mobile media trading desk

In-house bidding and optimisation

system

95% of its activity outside of France

Rev:

EBITDA:

Raised:

Employees:

N/A

N/A

HQ: Sweden Founded: 2002

Investors: ND

N/A

55

Efficiency-focused online advertising

solutions with real-time planning, buying,

optimisation and reporting.

DSP and DMP technology solutions and

a managed buyside service

29 GP Bullhound LLP

SELECTED COMPANY PROFILES ( C O N T . ) – D E M A N D S I D E


Rev: Raised:

Employees:

$50m


Investors: European Founders, QED,

Safeguard, SVB, SJF, Catalyst Investors

$24.4m

125

Offers cross-exchange advertising

management services and technology

Media buying service provides the

technology, strategy, services and

insights to trade effectively across the

leading display advertising exchanges

and supply sources on behalf of

agencies

Acquired Tap.Me in Dec-12

Rev: Raised: N/A

Employees:

N/A

HQ: London Founded: 2007

Investors: -

50

Delivers customised real-time advertising

campaigns for leading advertisers

Combines analytics with proprietary

targeting and optimisation tools to power

real-time display advertising

Customised DSP to maximise benefit of

first party advertiser data

Marketing intelligence and media trading

company

Produces market intelligence that

identifies the strengths and weaknesses

of each individual platform in market

Benchmarks across both price and

performance metrics

Rev: Raised:

Employees:

N/A



N/A

N/A

Rev:

EBITDA:

Raised:

Employees:

N/A

N/A


Investors: Private individuals

N/A

70

Next generation performance trading

specialist

Empowers agency partners with

predictive analytics in big data for online

display inventory trading

Rev:

EBITDA:

Raised:

Employees:

N/A

N/A

HQ: Netherlands Founded: 2012

Investors: Greenhouse Group

$900k

N/A

Empowers real time advertising

specialists with analytics and

optimization technology to buy and sell

ads more effectively

Integrated with Doubleclick and

AppNexus

Rev:

EBITDA:

Raised:

Employees:

N/A

N/A

HQ: Germany Founded: 2012

Investors: ZANOX.de

N/A

N/A

RTB buyside platform

Allows advertisers to make impression-

based marketing decisions

Provides flexible and customised

solutions for intelligent and highly-

personalized digital marketing strategies

30 GP Bullhound LLP

SELECTED COMPANY PROFILES ( C O N T . ) – S U P P L Y S I D E


Rev: Raised:

Employees:

N/A

HQ: Berlin Founded: 2009

Investors: -

N/A

N/A

Develops RTB solutions for advertisers

Platform that enables users to bid for

individual user impressions in real-time

auctions

Rev: Raised:

Employees:

N/A


Investors: eValue, DFJ Esprit, Karlin

Ventures, SoftTech

$9.1m

55

Leading mobile DSP providing a single

console through which users can run

global mobile RTB campaigns

Three Series A funding rounds since

Jun-12 for a total raised of $9.1m

Rev: Raised:

Employees:

$159.6m

HQ: Memphis Founded: 2007

Investors: Mohr (35%), Nokia (8%),

Nothgate (6%), Public (28%)

$77m*

465

Data-focused programmatic media

buying platform

Went public on Sep-13 and sold 4 million

shares at a price of $29, raising a total of

$116 million at a valuation of nearly $1

billion

* Pre-IPO

Rev: Raised:

Employees:

N/A

HQ: Amsterdam Founded: 2008

Investors: TOHARU Ventures, Partech

Ventures, Active Venture Partners

$5.9m

60

DSP providing bespoke software

allowing advertisers to optimise ads

based on real-time insights into

audience reach, acquisition price,

revenue and conversion attribution

Rev: Raised:

Employees:

N/A

HQ: Redwood City Founded: 2004

Investors: Greenspring Assoc, Norwest,

Trident, Shasta, Focus Ventures

$57m

N/A

Integrated, end-to-end platforms for data

and media management

Offers media expertise, client services

and a geographically distributed

infrastructure

Raised $20m in Jan-12 in a round led by

Greenspring Associates

Rev: Raised:

Employees:

N/A


Investors: Echelon, Hudson, Blue Chip,

WS, WallerSutton, Advanced, Intel

$39m

60

Data-driven multi-channel platform

offering based on its Predictive

Optimization Engine

Raised $17m of debt from Ares capital

in Apr-13

Acquired UberTags in Feb-13 and WDA

in Jul-13

31 GP Bullhound LLP

SELECTED COMPANY PROFILES ( C O N T . ) – S U P P L Y S I D E


Rev: Raised:

Employees:

N/A

HQ: Redwood City Founded: 2006

Investors: DPJ, Helion, Nexus, August,

SVB

$63m

380

Helps publishers automate the process

of evaluating and selling their advertising

inventory

Real-time media selling platform for

managing revenue and brand strategy

Raised $45m in Series D funding Jun-12

Rev: Raised:

Employees:

N/A

HQ: Los Angeles Founded: 1998

Investors: Clearstone, IDG, Mayfield,

Standford, Berkeley, Peacock, Fox

$51m

300+

The largest independent supply-side

RTB trading platform for digital

advertising used by more than 500 of the

world’s premium publishers to transact

with over 100,000 advertising brands

globally

Acquisitions include SiteScout, Fox

Audience Network and MobSmith

Rev: Raised:

Employees:

N/A

HQ: Amsterdam Founded: 2008

Investors: PubliGroupe (85%)

N/A

60

Provides a real-time advertising platform

to the owners of digital media

Enables media owners to build, grow,

manage, control, and optimize their own

environment driving revenues

PubliGroupe acquired 85% stake in Oct-

12

Rev: Raised:

Employees:

N/A


Investors: Amaury Medias, FigaroMedias,

Lagardère Publicité and TF1 Publicité

N/A

N/A

SSP/ Private Adexchange founded by

four French media leaders

120+ premium publishers’ partnerships

for a specific audience target

Partnership with Microsoft Advertising

since Nov-12

Launched a mobile Adexchange in May-

13

Operates as a mobile monetization

platform, providing ad serving,

optimization, and new ad experiences

for mobile applications

Had over 250 active publishers in July

2011

Closed $18.5m series B round in Sep-

12

Acquired by Twitter Sep-13 for $350m

Rev: Raised:

Employees:

N/A

HQ: San Francisco Founded: 2010

Investors: Twitter (100%)

$18.5m

45

Rev: Raised:

Employees:

N/A

HQ: Southampton Founded: 2008


N/A

60

Digital advertising solutions for

publishers

Single platform adserver, RTB and data

driven optimisation

2nd fastest growing UK tech company,

(Sunday Times Hiscox TechTrack 100)

Innovation in partnership with

Southampton University's Web Science

Faculty

32 GP Bullhound LLP

SELECTED COMPANY PROFILES ( C O N T . ) – A D E X C H A N G E S


Rev: Raised:

Employees:

N/A


Investors: Google (100%)

N/A

1,541

Provides digital ad serving technology

and services

Services display, video, search and

affiliate marketing

Acquired by Google in Apr-07 for $3bn

Rev: Raised:

Employees:

N/A

HQ: Menlo Founded: 2012

Investors:-

N/A

N/A

Allows marketers to use their own real-

time consumer insight data to reach an

audience on Facebook

Advertisers and agencies use cookie-

based targeting through DSPs to reach

their audience on Facebook in real time

Rev: Raised:

Employees:

N/A

HQ: Gothenburg Founded: 2002

Investors: Chalmers Innovation AB, KL

Ventures, Layline Partners

$5m

40

Private Ad Exchange offering online

advertising platform solutions for

advertisers and publishers in Europe

Provides a yield optimization platform for

publishers and a networks Web based

campaign management platform for

agencies and advertisers

Rev: Raised:

Employees:

N/A


Investors: Yahoo! (100%)

$45m

134

Digital advertising exchange platform

Auction marketplace for buying and

selling online inventory

Connects digital advertising companies

and provides an opportunity for these

participants to reach their audiences on

their own terms

Acquired by Yahoo! In Apr-07 for $850m

Rev: Raised:

Employees:

N/A


Investors: DFJ, Gold Hill, Investor

Growth Capital, New Atlantic, Updata

$3m

150

Ad exchange and SSP providing a

spectrum of services including data

management, media mix optimisation,

content distribution, and contextual ad

exchange capabilities

Formed in 2011, from a merger between

Contextweb and Datran Media

Rev: Raised:

Employees:

N/A

HQ: Pasadena Founded: 1998

Investors: First, Index, Mangrove,

Mitsui, Accel, DAG, SAP, AOL, Cyber

$50m

305

Independent provider of digital

advertising technology that enables

businesses to manage and maximize

their ad revenue

Comprehensive revenue generation

platform by combining ad serving with a

unique ad exchange

Closed $25m Series E funding in May-11

33 GP Bullhound LLP

SELECTED COMPANY PROFILES ( C O N T . ) – C R O S S P L A T F O R M T E C H N O L O G Y / T A R G E T I N G


Rev: Raised:

Employees:

N/A


Investors: IQ Capital Partners LLP

$2.45m

N/A

Contextual advertising tool for display

media

Uses probability algorithms to optimise

the placement of content and

advertisements online

Helps publishers to create virtual

channels specific to each advertiser’s

contextual needs.

Rev: Raised:

Employees:

N/A

HQ: Hamburg Founded: 2006

Investors: ViewPoint Capital Partners

N/A

N/A

Provides a full stack of RTB-enabled

technologies

Functions and services include DSP,

DMP, Ad Serving, Data Exchange, SSP,

dynamic creative and dynamic video that

fully integrate into the first end-to-end

data-driven advertising platform

Rev: Raised:

Employees:

N/A



N/A

140

RTB infrastructure and technology

provider

Provides real time data analysis for

targeting consumers through custom

engineered, intelligent, scalable, media

trading platforms

Powers over 40 online ad platforms

across the world

Rev: Raised:

Employees:

N/A


Investors: Iris, Accel, t-ventures, Carmel

$37m

17

Performance based display advertising

solutions for online advertisers in Europe

and internationally

Enables merchants to stay in touch with

prospects after they leave the site, and

delivers an optimized message for each

user

Winner of the 2011 E-consultancy

Innovation in Affiliate Marketing Award

Rev: Raised:

Employees:

N/A

HQ: Bellevue Founded: 2003

Investors: 19

$100m

135

Offers online behavioural targeting

platforms and marketplace for the digital

media industry

Targets relevant audience for advertisers

through its data-driven platform

Rev: Raised:

Employees:

N/A


Investors: VCs (34%), Individuals (16%),

Corporations (11%), Public (39%)

$60m*

700

Provides pay-per-click performance

display advertising solutions in France

and internationally

Platform leverages large data sets to

target relevant users in real time

Went Public on Nasdaq in Oct-13

* Pre-IPO

34 GP Bullhound LLP

SELECTED COMPANY PROFILES ( C O N T . ) – V I D E O A D E X C H A N G E S / A D S E R V E R S


Rev: Raised:

Employees:

N/A


Investors: AOL (100%)

$48.5m

205

Online video advertising platform

Provides buyers and sellers with

automated tools to plan, buy and

measure across linear TV and online

video

Acquired by AOL for $405m in Aug-13

Rev: Raised:

Employees:

N/A


Investors: Trident, Scale, Adams Street,

True ventures, Comerca Bank, KPG

$46m

70


Enables advertisers to execute digital

video campaigns across a pool of web

and mobile video inventory

100 million monthly unique viewers

Raised $30m in Series C Funding in

Nov-11

Rev: Raised: €2.88m

Employees:

N/A

HQ: Austin Founded: 2009

Investors: Videology (100%)

Mobile marketing platform

Provides media optimization services to

publishers and advertising networks for

enabling targeting on mobile devices

Was acquired by Videology in Jun-12

Rev: Raised: $8.5m

Employees: 110

N/A


Investors: Cleartide Limited, Pond

Ventures

Online video advertising

The company’s platform provides

solutions that range from RTB and on-

boarding custom data to campaign

management, analytics, and

streamlined client billing

Raised $4m in Series C funding in Jun-

13

Rev: Raised: $53.2m

Employees:

N/A

HQ: Emeryville Founded: 2006

Investors: NSV, Bee, Knight Bridge,

Trinity, Foundation, Northgate, SingTel

N/A

Online video ad buying platform

Advertisers only pay when someone

chooses to watch their video and they

see which sites their ads ran on, how

their ads performed and who watched

them

Raised $10m in Series C Funding in

Jun-13

Rev: Raised: $134m

Employees: 180

N/A

HQ: Baltimore Founded: 2007

Investors: Boulder, New Enterprise,

Valhalla, Comcast, Catalyst, Pinnacle


Predictive targeting product that

improves advertisers' ability to reach

their intended audience

Acquired ColliderMedia Jun-12 and

LucidMedia Oct-12

Raised $60m in May-13

35 GP Bullhound LLP

SELECTED FUNDRAIS ING TRANSACTIONS

Source: GP Bullhound, Capital IQ, Company press releases, ND = Not Disclosed

Date Target Target HQ

Funds

Raised($m) Investors

Sep-13 Action Exchange US 3 SoftBank Capital; AOL Ventures; Lerer Ventures; Verizon Ventures; Golden Venture Partners, Inc.

Sep-13 StrikeAD UK 7 DJF Esprit, Siemer Ventures, SoftTech VC

Sep-13 YD Netherlands 6 Partech International; Active Venture Partners, SGECR, S.A

May-13 Triggit US 6 Foundry Group, North Atlantic Capital, Spark Capital

May-13 TubeMogul US 8 Singtel

Apr-13 AudienceScience US 9 ND

Feb-13 DataXu US 27 Atlas Venture, Flybridge Capital Partners, Infocomm Inestments Pte, Menlo Ventures, Thomvest Ventures

Jan-13 AppNexus US 75 TCV, Venrock, Tribeca

Jan-13 Glow Digital Media UK 1 Avonmore Developments Ltd , Project A Ventures GmbH & Co. KG

Jan-13 OpenX Canada 25 Accel, Cyber Communications, Index, Mitsui & Co, Presidio STX, Samsung Venture, SAP Ventures

Jan-13 PulsePoint US 3 DFJ, Investor Growth Capital, Vantagepoint, Updata

Dec-12 TubeMogul US 29 Northgate, Trinity, Foundation

Nov-12 Triggit US 7 Foundry Group, Spark Capital

Oct-12 Brandscreen Singapore 11 Macquarie Capital Grup, SingTel Ventures, Southern Cross Venture Partners

Sep-12 Criteo France 40 Adams Street Partners, Bessemer Venture Partners, Index Ventures, SAP Ventures, SoftBank Capital, YJ Capital

Jun-12 PubMatic US 45 August Capital, Draper Fisher Jurvetson, Helion Venture Partners, Nexus Venture Partners, SVB Silicon Valley Bank

Mar-12 MyThings UK 15 Accel Management, Carmel Ventures, GP Bullhound, Iris Capital, T-Venture Holding, Viola Private Equity

Feb-12 XPLUSONE US 5 Hudson Ventures

Jan-12 Visual DNA UK 10 ND

Dec-11 RevenueMax Germany ND High-Tech Gruenderfonds Management GmbH

May-11 OpenX Canada 20 Accel, AOL Ventures, DAG Ventures, Index, Mitsui & Co, Global Investment, Presidio STX, SAP Ventures

Apr-11 PulsePoint US 9 ND

Apr-11 Improve Digital Netherlands ND Van den Ende & Deitmers

Mar-11 MediaMath US 14 Safeguard Scientifics, Inc

Jan-11 StrikeAD UK 1 eValue AG

Jan-11 XPLUSONE US 10 Advanced Technology Ventures, Blue Chip Venture Company, Hudson Ventures, Intel Capital

Jan-11 Turn US 20 Focus Ventures, Greenspring Associates, Norwest Venture Partners, Shasta Ventures, Trident Capital

Dec-10 Brandscreen Singapore 3 Adventure Capital Pty

Dec-10 SpotXchange US 12 H.I.G. Growth Partners LLC

Dec-10 Admeta Sweden ND Chalmers, KL Ventures, Layline Partners

Nov-10 MyThings UK 6 Accel Management , Carmel Ventures, GP Bullhound, T-Venture Holding, Dotcorp

Nov-10 Admeta Sweden ND Chalmers, KL Ventures, Layline Partners

Nov-10 The Rubicon Project US 18 Clearstone Venture Partners, IDG Ventures, Mayfield Fund, News Corporation, Peacock Equity Fund

Oct-10 AppNexus US 50 First Round Capital, Kodiak Venture Partners, Microsoft Corporation, Venrock

Sep-10 TubeMogul US 10 Foundation Capital, Knight's Bride Capital Partners, Trinity Ventures

Jun-10 Triggit US 4 Foundry Group, Spark Capital

Jun-10 adscale Germany 6 TIME Equity Partners

May-10 AudienceScience US 8 ND

May-10 Criteo France 6 Bessemer Venture Partners

Apr-10 PubMatic US 8 Draper Fisher Jurvetson, Helion Venture Partners, Nexus Venture Partners

Mar-10 The Trade Desk US 3 Founder Collective, IA Ventures, Wider Wake Networks

Mar-10 DataXu US 11 Atlas Venture, Flybridge Capital Partners, Menlo Ventures

Jan-10 Adform Denmark ND Via Venture Partners A/S, Via Venture Partners Fund I

Dec-09 Grapeshot UK 2 IQ Capital Partners

Nov-09 AppNexus US 5 Kodiak, Venrock, First Round Capital

Oct-09 AudienceScience US 15 Integral Capital Partners, Mayfield Fund, MeriTech Capital Partners, Mohr Davidow Ventures

Sep-09 The Rubicon Project US 9 Clearstone Venture Partners, Mayfield Fund, Peacock Equity Fund

Aug-09 MediaMath US 13 SVB, European founders fund, QED, Safeguard Scientifics

May-09 OpenX Canada 10 Accel Management, DAG Ventures, First Round Capital, Index Ventures, Mangrove Capital Partners

Apr-09 DataXu US 8 Atlas Venture, Flybridge Capital Partners, Menlo Ventures

Apr-09 The Rubicon Project US 5 Clearstone Venture Partners, IDG Ventures, Mayfield Fund

Mar-09 TubeMogul US 3 Trinity Ventures

Mar-09 PubMatic US 4 Draper Fisher Jurvetson, Helion Venture Partners, Nexus Venture Partners

Feb-09 Visual DNA UK 14 Northzone, Atomico, Horizons Ventures

Sep-08 AppNexus US 8 First Round Capital, Khosla Ventures, Kodiak, Venrock

Sep-08 MyThings UK 8 Accel Management, Carmel Ventures, GP Bullhound, Dotcorp

Aug-08 Turn US 15 Focus Ventures, Norwest Venture Partners, Shasta Ventures, Trident Capital

May-08 XPLUSONE US 16 Advanced Technology Ventures, Blue Chip Venture Company, Hudson Ventures

Mar-08 AdJug UK 7 Balderton Capital, Tomorrow Focus AG (DB:TFA)

Mar-08 Turn US 15 Norwest Venture Partners, Shasta Ventures, Trident Capital

Mar-08 Unica US 18 Balderton Capital, Tomorrow Focus AG (DB:TFA)

Feb-08 YD Netherlands ND Toharu & Angel

Feb-08 SpotXchange US ND Angel Investors

Feb-08 TubeMogul US 2 Knight's Bride Capital Partners

Jan-08 The Rubicon Project US 15 Clearstone Venture Partners, IDG Ventures, Mayfield Fund, Stanford University, University of California Berkeley

Jan-08 adscale Germany ND European Founders Fund Magagement GmbH, Holtzbrinck Ventures GmbH

Jan-08 Triggit US 1 Bay Partners

Jan-08 OpenX Canada 16 Accel Management Co, First Round Capital, Index Ventures, Mangrove Capital, O'Reilly Alpha Tech Ventures

Jan-08 Criteo France 10 AGF Private Equity, Elaia Partners, Index Ventures

Jan-08 PubMatic US 7 Draper Fisher Jurvetson, Helion Venture Partners, Nexus Venture Partners

Jan-08 Admeta Sweden 5 Sjaette AP-fonden

Dec-07 AppNexus US 3 First Round Capital, Khosla Ventures, Various Angels

Oct-07 TubeMogul US ND NetService Ventures

Oct-07 The Rubicon Project US 4 Clearstone Venture Partners

Jun-07 OpenX Canada 5 First Round Capital, Index Ventures, Mangrove Capital Partners, O'Reilly SlphaTech Ventures

May-07 Visual DNA UK 5 Northzone

Mar-07 MediaMind Technologies US 30 BRM Group

Oct-06 Right Media US 45 Redpoint Ventures, Yahoo! Inc. (NasdaqGS:YHOO)

Apr-06 MyThings UK 8 Accel Management, Carmel Ventures

Mar-06 Criteo France 7 AGF Private Equity, Elaia Partners

Nov-05 AudienceScience US 24 Integral Capital, Mayfield Fund, MeriTech , Mohr Davidow, Second Avenue

Jun-05 Right Media US 12 Redpoint Ventures

Apr-05 PulsePoint US 60 VantagePoint Venture Partners (nka:VantagPoint Capital Partners)

Jan-05 Turn US 8 Norwest Venture Partners, Trident Capital

Aug-04 XPLUSONE US 8 Blue Chip Venture Company, Echelon Ventures, Hudson Ventures, WS Capital

Dec-03 MediaMind Technologies US 8 Insight Venture Partners

Mar-02 AudienceScience US 15 American Express, Angel Investors, Cedar Grove , Deutsche Bank, Gulf International, Kellett, Mayfield, Mohr

Jan-02 XPLUSONE US 1 ND

Apr-01 XPLUSONE US 3 Echelon Ventures, Hudson Ventures

Sep-00 AudienceScience US 20 Cedar Grove Investments LLC, Kellett Investment Corporation, Mayfield Fund, Second Avenue Partners

Apr-00 AudienceScience US 5 Angel Investors, Cedar Grove, Deutsche Bank, Investment Arm, Kellett, Madrona Venture, Second Avenue

Jun-97 DoubleClick US 40 ABS Capital Partners, Bain Capital Private Equity, Canaan Partners, Greylock Partners, Venrock, Peck & Greer Venture

36 GP Bullhound LLP

SELECTED M&A TRANSACTIONS

Source: GP Bullhound, Capital IQ, Company press releases, ND = Not Disclosed

Date Target

Target

Geography Acquirer EV ($m) Target Description

Nov-13 Tedemis US Criteo 20 Email re-targeting

Nov-13 Sitescout US Centrico 40 RTB demand side platform

Sep-13 Mopub US Tw itter 350 Supply side platform for mobile adds

Sep-13 Gradient X US Amobee (Singtel) ND RTB platform for mobile ads

Aug-13 Jumptap US Millenial Media 209 Mobile DSP

Aug-13 Adap.tv US AOL ND Full RTB technology stack for video

Jul-13 AdMovate US Yahoo ND Mobile ad targeting platform

Jul-13 Ad X Tracking UK Criteo ND Mobile ad tracking platform

Jul-13 Matiro France 1000mercis 3 Media trading platform for online advertisements

Jul-13 IgnitionOne, Inc. US ABS Capital Partners, Persimmon Capital Partners ND Digital marketing technology

Jan-13 Akamai Decisions Solutions US MediaMath ND Advertising decisions platform

Jan-13 Mobvalue France Prisma Media ND Mobile advertising netw ork and platforms

Dec-12 adscale Germany Stroer ND Platform for buying real-time online advertising

Dec-12 TapMe US MediaMath ND Mobile and video in-game ad platform

Oct-12 JumpTime US OpenX Technologies ND Content optimisation technology

Oct-12 Improve Digital Netherlands PubliGroupe ND Supply Side Platform

Jun-12 Collective intellect US Oracle ND Automated real-time mining & analytics softw are for social CRM

Apr-12 Peer39 US DG MediaMind 16 Data provider to improve relevance and effectiveness of online display advertising

Mar-12 MobSmith US the Rubicon Project 10 Location-based mobile advertising platform

Mar-12 Amobee US Singtel 321 Mobile advertising solutions for operators

Jan-12 Mexad Germany DataXu ND Demand Side Platform

Nov-11 Interclick US Yahoo! 273 Data management and analytics platform

Oct-11 Smartclip Germany Adconion 168 Online video advertising netw ork

Aug-11 AdJug UK IgnitionOne / Dentsu ND Platform for buying real-time online advertising

Aug-11 Dotomi US ValueClick 295 Interactive digital marketing

Jun-11 Mediamind US DG Fastchannel 414 Digital advertising campaign mgt infrastructure

Jun-11 Admeld US Google 400 Digital advertising platforms

May-11 ReviNet US PubMatic ND Netw ork optimization services for online publishers

Apr-11 Adbuyer.com US MediaBank ND Platform for buying real-time online advertising

Apr-11 Adenyo US Motricity (nka Voltari) 140 Digital and mobile marketing

Feb-11 Oggif inogi US Collective Media ND Real time video ad platform

Feb-11 Transpera US Tremor Media ND Mobile video technology

Nov-10 ScanScout US Tremor Video 65 Streaming ad server

Nov-10 FAN US the Rubicon Project ND Online marketplace for digital advertising

Oct-10 MobClix US Velti 54 Mobile Ad Exchange

Jun-10 Invite Media US Doubleclick 40 Buying platform for display media

May-10 SiteScout US the Rubicon Project ND Cloud-based publisher protection platform

Mar-10 adscale Germany Various investors ND Exchange platform for buying real-time online advertising

Jan-10 AdMarvel US Opera Softw are 23 Mobile advertising platform services

Jan-10 Quattro US Apple 275 Mobile advertising netw ork

Aug-07 Chintano US Datran Media (nka PulsePoint) 20 Ad server

May-07 Right Media US Yahoo 850 Display advertising exchange

Apr-07 DoubleClick US Google 3,110 Platform for buying real-time online advertising

37 GP Bullhound LLP

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