Discover more from The FirstPartyCapital Newsletter
Lumen Winning The Attention Arms Race; FirstPartyCapital, Pleased To Meet You; Ad Tech Short-Selling Nonsense
A quick note to our readers… With Easter and the multitude of bank holidays over the past 6 weeks, the FPC newsletter output has become a little erratic. We aim to remedy that by returning to our weekly schedule, providing you with the usual pithy analysis of all MadTech-related investment stories. MadTech FTW. Onwards.
Lumen Winning The Attention Arms Race; Now A New Opportunity To Invest
ExchangeWire outlines a little more detail on the deal:
By integrating Lumen’s eye-tracking technology and predictive attention datasets into the IAS Attention Model, this partnership represents a first-of-its-kind collaboration to accurately track advertising impressions which capture attention.
The attention model, which is built with signals from visibility, situation, and interaction, will now be supported by Lumen’s technology as a way to measure human focus on the screen and how long focus is fixated on a specific image. Specifically, Lumen’s eye-tracking and attention tags will give even more insight into the interaction signals of the model.
We are now getting into the maturation phase for the attention category. The industry is finally realising the opportunity,
And now one of the leading ad verification solutions - with global scale - is going all in. Lumen’s eye-tracking panel and underlying predictive datasets are the foundation for that IAS solution.
This is the biggest announcement for the category to date.
Here’s a few hot takes on what this all means for “attention” and Lumen, as you ponder the weekend ahead:
Attention is equally as important as viewability, with brands and marketers looking to understand more about engagement.
Attention will be standardised, leading to mass adoption.
Lumen’s IP and tech will be baked into a core product of one of the industry’s key ad tech players (IAS).
IAS is worth $2.5 billion, and NEEDS to make strategic buys to power future growth.
Lumen is the leading attention technology on the market, bringing together its proprietary eye-tracking panel, associated data assets and scaled ad tech.
Lumen has positioned itself as the industry’s go-to attention technology provider.
This leading position was recently rubber stamped by everyone's favourite ad tech whisperer, PWC. In a recent audit of its technology - a first for any company in this category - PWC highlighted Lumen’s “attention methodology and model as a way to drive better performance across both engagement and purchase orders”.
Lumen is very much an ad tech enabler, and not a managed service ad net (where most of the attention vendors sit).
This means Lumen can partner with anyone and everyone. And when an exit does materialise (and it will), the multiple on top line revenue will be all that sweeter.
As readers know, FPC is leading the series A round for Lumen. We have already secured £1.5 million - part of which was filled by our syndicate.
The remaining £1.5 million will be closed in the coming weeks, closing out the £3 million round.
Given the demand, we have managed to carve out another £250K for the FPC syndicate. This deal will be live on the platform from today.
The offer is limited (first come, first serve), and we aim to box it off by the end of May. This is the last chance to invest in Lumen. Get a slice.
Use the link below to get more detail:
FirstPartyCapital? Who Are You?
We have had a flurry of new subscribers to the FirstPartyCapital newsletter in the past few months, so we thought it would be good to give an overview of FirstPartyCapital - as well as give our long-standing readers an update.
FirstPartyCapital is an early-stage investor in ad tech, martech and digital media (pre-seed, seed and series A), the only vertically-focused fund investing at that level outside the US.
We operate a fund and syndicate: the fund invests across a basket of companies; the syndicate gives people access to invest on a deal-by-deal basis.
We are within touching distance of $10 million AUM.
We lead most of the rounds we participate in, and have board seats.
Our fund investors include senior industry leaders and strategic companies in the space.
We aim to raise $20 million, and close fundraising at the end of this year,
We will invest in 15-20 companies in fund 1, allowing us to maximise the number of portfolio cos we can scale and exit.
Our objective: to make our LPs money; make founders money; make ourselves money; and build great companies in the process.
Our mantra (sing it, EVERYONE): here to deliver returns; not to just wear gilets and live off fees.
How are we doing? Pretty well, actually.
All of our portfolio has low burn and good runway (enough until the next raise).
A good portion of the portfolio is generating 7-figure annual revenue; some are already profitable.
A number of mark-ups are coming this year.
No exits yet but we are only 2 years into a 7 year fund. Given the trajectory of a few of our cos, exits are likely from year 3 onwards.
And that should bring everyone up-to-date.
If you are interested in investing in the FPC fund, we are still open to new LPs. Fill out the following form, and we will get in touch:
FPC Take On Spruce Point Capital Versus DoubleVerify
Infamous short-seller Spruce Point Capital again took aim at ad tech with a report on the DoubleVerify stock, causing a 6% slide after its release.
Some of the earth-shattering findings included changed international office addresses on the company’s website, supporting Spruce Point’s view that DoubleVerify management "orchestrated a brazen scheme to artificially inflate DV's share price by selling and obscuring an international growth narrative that is failing while they rapidly unload stock."
It bizarrely highlights previous (alleged) misdemeanours by management to support this ongoing conspiracy. We all love a good short as much as the next guy, but this feels like a proper overreach.
Brain Wieser does a great job on countering the wild assumptions made by the Spruce Point Capital intern that clearly put this report together.
An excerpt can be seen below:
More Evidence of International Struggles…Spruce Point has analyzed DV’s global locations listed on its website. We find that it frequently changes addresses and has closed more physical locations than opened. Notably, it no longer has a listed address in the technology hub of San Francisco and shuttered offices in Latin America.”
Many companies around the world with small satellite offices closed those offices between 2020 and 2023 to either get out of leases and find cheaper space, or allow employees to work from home. Similarly, it would be unsurprising if companies with small physical footprints changed office locations regularly.
A wonderfully skewered response there from Brian.
It’s clear to FPC that Wall Street still hasn’t got a scooby-doo about ad tech - or any market outside the US.
Doubtless, the public markets can be a brutal environment to operate - but despite the blip, DoubleVerify can take solace in the fact that it is still worth $4.5 billion.
Let’s wrap up there. Have a great weekend, readers.