News

Back to News

News

July 13, 2012, Article

Article

HOT COMPANY PROFILE: Ad tech firm MediaMath

Link to original Digital Media article

Display advertising is experiencing something of a resurgence as marketers become increasingly confident of the effectiveness of advertising on the internet and newer formats like video and mobile gain traction. However, with spend on the up, advertisers are finding it more and more difficult to keep track of their ad buying. This is where MediaMath comes in. The company offers advertisers a service that plugs into ad exchanges, trading ad inventories in real time much like stocks are traded on the stock exchange. Co-founder and GM EMEA Erich Wasserman says MediaMath already has more than 600 clients, including major ad holding firms like WPP, Interpublic and Aegis, and has been profitable for “a while”.
www.mediamath.com
@MediaMath

What differentiates MediaMath from other ad tech firms?
First is the ability to access a great degree of media and data scale. That can mean access to many of the automated markets and from a global perspective the ability for marketers to bring in their own media liquidity to a centralised platform. You need systems that can talk to a great number of other systems. Second is usability, so once all of this data and media is in the system and a user has a business goal, how efficiently and how well can they do it. Third, optimisation, or how you choose the best elements from a set of alternatives. This is the ability to rely on machine learnings to help you determine what to buy and what not to buy, and when you buy it you want to make sure it's the right price and that that price is correlated to the value that you put on particular users. Access to scale, usability and optimisation are the things that we certainly believe we excel at.

Who are your main competitors?
They consist of technology vendors in this niche. Turn and Invite Media, which is owned by Google, are the two I see most in the market.

What is your business model?
Our business model consists of selling licences to our clients, who then utilise the platform at their discretion. We incentivise clients to spend more in the system.

We are profitable, we have been for a while. We have grown at about 140% over the last five years and don't expect that growth to abate.

What is the biggest challenge you currently face?
Globalising our operation and doing that well. Respecting the ways that buyers from exceedingly diverse markets interact with media and think about the landscape and what's important and then assimilating that into a product that can address those diverse needs is exceptionally challenging.

What is the biggest trend in digital media?
The tendency toward automation. Traditional media buying methods are exceedingly manual and it takes a great deal of time to enact optimisations. If you're a media planner and you want to target users in the morning rather than the evening, in order to actually instruct a series of vendors to make that change is a week-long process. And in that week you've wasted a great deal of money advertising at the times when you know customers aren't predisposed to interact. If you were able to make that rule active in 15minutes using an automated system, that obviously presents a great deal of efficiency. It's really towards relinquishing old methodologies and adopting the cutting edge.

VERDICT
Display advertising is a booming market, with the format now the fastest growing online ad category worldwide and revenues forecast to rise by 20% annually to USD47.75bn in 2014. While much of that growth is down to sites such as Google and Facebook, services such as MediaMath's are becoming increasingly important. Estimates suggest that these platforms accounted for 10% of total US online ad spend in 2011, with that figure expected to rise to 50% over the next few years. MediaMath made an early move into the market, launching its technology in August 2007, ahead of rival Turn, which came to market in 2008, and before Google bought Invite Media in 2010. Wasserman believes this is crucial to MediaMath’s strong position in the market, and led to the firm being crowned the winner in Forrester Research’s first report into this space.

Key now is expansion beyond its home market. The firm is already profitable and so can afford to invest in growth, but Europe throws up a number of challenges, not least because each country has its own laws on advertising and privacy. Wasserman also highlights levels of familiarity with technology and the differing ways markets across Europe buy media and measure its effectiveness as key challenges. However, he says MediaMath is focused on becoming a global player and could look to raise more money in the future as a way of accelerating its growth.

MediaMath also needs to ensure that it remains on top of new trend in the market. Video, mobile and social are the obvious growth areas at the moment, but as the world becomes more connected it is likely that new formats, such as digital outdoor and internet TV, will become more important. This will soon become the case across particular devices as well.

AT A GLANCE
CEO:Joe Zawadzki
HQ: New York, US
Founded: August 2007
Employees: 165
Commercial Launch: August 2007
Funding to date: USD24.4m
Investors: European Founders Fund, QED Investors, Safeguard Scientifics

Back to News

View all Locations
Contact Us
*The following fields are missing.

Thank You

Your request has been received and we will contact you shortly.