Discover more from The FirstPartyCapital Newsletter
Oversubscribed Lumen Deal; Ad Tech, Fighting Fit; And An Offer For You
Lumen Deal OVERSUBSCRIBED In Just One Week… But You Can Still Get A Piece
Well, that was quick. Our £400K Lumen syndicate allocation has gone. It is the fastest close we ever have had on the platform.
We will now be making available an additional allocation (even smaller than the first) to syndicate investors.
If you want to get more information, use the link below to access the deal:
There is going to be a time limit on this one as well - so get it while it is still here.
The remaining £1.5 million of this round is being offered out to institutional investors, and we expect it to close in the next 30 days.
We believe Lumen will be a category winner, building the attention technology layer for open web and walled gardens. The tech is a winner. The team is strong. And the wind is in our ad tech sails. Nothing more to add there.
Ad Tech Is In The Best Shape Of Its Life
Brian Wieser is FPC’s favourite industry analyst. He has an unrivaled understanding of the advertising and marketing markets.
His synopsis is that the sector is in rude health:
Combined it’s probably safe to say that independent ad tech grew their revenues by high teens levels during 2022 including more than 10% growth in the fourth quarter. Of course, this is not the same as saying that all of ad tech grew by these levels, as we can’t know how fast Google’s ad tech businesses grew, let alone those owned by Yahoo, Microsoft, Comcast or others where ad tech are relatively small subsidiaries. Still, it seems reasonable to assume that the overall sector was healthy last year, and grew at a faster rate than digital advertising from a media owner’s perspective.
Brian also believes long term ad tech has room to keep growing at the same rate given how important data-driven capabilities have become for marketers:
This last point is potentially quite important. As I noted when I recently wrote about growth trends for agencies, whose businesses also performed strongly last year, it is clear that newer data-driven activities are key areas of focus for the marketers they work with. Despite efforts from some marketers to cut costs which are unrelated to spending with media owners (so-called “working spend”), growth in ad tech and agency activity may convey that marketers implicitly recognize that incremental spending on so-called “non-working” spending can actually make the “working” spend and overall marketing activities significantly more efficient.
Overall, the latest data from ad tech companies represents a positive trend for the so-called intermediaries of the industry. Given their modest size in aggregate (probably only representing a single digit percentage of total digital advertising at present), I can argue that there remains significant room for continuing outperformance for the sector, even if digital media owners continue to decelerate as they mature.
Despite the economic headwinds there remains room for data-driven digital marketing to grow. We operate in a $5 trillion marketing sector so growth opportunities for ad tech continue to emerge - from addressable TV to commerce media to the reimagining of measurement and targeting in the privacy-first era.
FPC is excited by what we are seeing in the industry in terms of innovation and investment opportunities.
Clearly, it’s all upside for our portfolio companies and our LPs.
We Have An Enterprise DSP For Sale. Are You Buying?
After a recent merger and subsequent investment, one of our portfolio companies is looking to sell a DSP asset that’s not core to its business going forward.
It is important to note here: FPC is not getting into the M&A game. We are not bankers. We are very much capital allocators. Firms specialise in M&A for a reason.
As the lead investor, we are helping the company to sell this DSP asset (with unique SPO capability).
Listed below is what’s on offer:
SPO capabilities core to the product
Good client base
If there is any interest among our readership in acquiring this asset, then get in touch via email@example.com.
Have a great weekend, readers.