Google's Awful Week Could Trigger A Big Decision; In Data Activation, Local Wins; And Come Join Our Pilot Scheme
After A Brutal Week, Will Google Stay Or Go?
Google is having an exceptionally bad week. The company lost its appeal against its 4 billion euro fine levied by the EU over anti-competitive practices, allegedly using the Android operating system dominance to effectively batter competitors.
It then failed to quash a megasuit that is accusing it of monopolising the ad tech market. The judge did throw out the core accusation of collusion between Meta and Google.
And to top a great week, the company is now being sued by European publishers for a sum of $25 billion.
What’s going on here? Why is everyone going after the big G?
Google is just too big. It owns a huge chunk of the ecosystem thanks mainly to some very savvy M&A.
The US and EU FOOLISHLY allowed it to buy DoubleClick in 2007 - without asking anyone in ad tech whether it was a good idea. It wasn’t.
This was the dumbest piece of oversight - possibly ever seen - in any recent M&A transaction.
And now we are in this no win situation for everyone.
Google did buy its way into ad tech, but the company has executed flawlessly over the past 15 years, hiring the smartest talent and building a world-beating commercial strategy.
I really do feel for Google here. It would probably dearly love to jettison its ad tech business, allowing it to focus on high growth areas. But what kind of retribution would it face for “deliberately sinking” independent ad tech and publishers.
The latter point is clearly ludicrous as ad tech would never have a better opportunity in a market without Google.
It is important to note that FPC does not have a dog in this fight. We do not hold any real antipathy towards Google these days.
All our startups will prosper whether or not Google stays or goes. In short, we couldn't care less if walled gardens prospered or died. FPC portfolio companies are built for both scenarios.
Is Google pondering the big move then? Given all this heat, here are six reasons why it might surprise us all in the coming months:
It would kill the majority of these ant-competitive suits, allowing it to settle with the EU and US.
It could realise a lot of financial value from spinning out its ad tech layer.
An ad-tech-free Google could entice most of its former competitors to move their data onto its big margin cloud offering.
There would be no privacy headaches - given binning ad tech would allow Chrome to pull the trigger on third party cookie deprecation.
A privacy-first Android would blunt the iOS advantage, which is currently eating into market share
Google could free more resources to focus on the growth areas in the business (search, YouTube, cloud et al)
FPC has been predicting a Google good-bye since the mid-tens - so don’t be surprised if we are having the same discussion at the start of the next decade.
The €2 Million ARR Ad Tech Solution You Should Be Investing In
"Keeping it local" is a phrase that seems oxymoronic when considering the scalability of ad tech.
Generally that would be the case. But when it comes to data activation for “local hero brands” in privacy-first and highly fragmented Europe, it needs to be the go-to strategy.
Digital Audience, our latest platform deal, is building a strong basis on the back of privacy-first segmentation, aggregation and activation at the local level.
We believe this is a company that will be acquired for $50-$100 million. This is not hyperbole. They are already doing $2 million revenue from a handful of small geos.
Once they hit their stride and build share across Europe's unforgiving but lucrative market, an exit of that size will be a formality.
To find out more information about this deal, you can access it here:
And here are again our reasons for investing:
DA is on course to do €2+ million in recurring SaaS revenue this year with a very low burn rate.
The company is building a “clean room” tech moat in local European markets where larger solutions are unable to provide the scale required by local advertisers and publishers.
This “clean room” playbook is applicable to at least 10 additional markets, and the company is already making inroads into several new geographies.
There is huge value in aggregating these mid-sized markets as in aggregate it represents a very sizeable TAM, making it attractive to prospective buyers.
Digital Audience will be acquired in the €50-€100 million range in the next 2-3 years, offering investors a good return on the value of this pre-series A round. This is the ultimate value arbitrage.
The team are ad tech veterans who understand the specific needs of the local European market.
Come Join The Wult Pilot Program - Open Invite To Our Readership
Wult has built enterprise privacy workflow software for overstretched compliance professionals. It is the ultimate solution for any organisation working with data in digital publishing and marketing.
The company's solution, as you know from previous editions, is aimed at DPOs (data privacy officers) and other professionals managing compliance and data protection internally.
Today is your lucky day. The company is currently running a pilot test with a bunch of European consumer-facing companies working in data sensitive areas like marketing and fintech.
Listed below are key features of the Wult platform that will help as an overview.
Regulation focus, racking regulation and enabling organisations to adapt processes and stay ahead of changing regulatory landscape
Risk detection, automating risk detection across datasets.
Data automation, saving time with powerful automated workflows
Consumer hub, enabling out-of-the-box consumer management.
Vendor mapping: taking control of third-party vendors.
If you are interested in learning more about the solution, email us directly on email@example.com.
Have a great weekend, readers.