Telenor Jumps Into Advert Tech, Acquires Tapad For $360M
Verizon isn’t the one service that desires to ramp up in advert tech to enrich (and offset) its legacy enterprise. At the moment, Norway-based mostly Telenor introduced that it has acquired Tapad, a New York-based mostly cross-system retargeting startup co-based by two Norwegians, Are Traasdahl and Dag Liodden, for $360 million “on a debt and money-free foundation.”
The worth covers ninety five% of the corporate. Traasdahl and Liodden are collectively protecting the remaining 5%. The deal is predicted to shut Q1 2016, topic to regulatory circumstances. It’s a non-money deal, however on paper it represents an enormous premium on the quantity the startup raised: slightly below $34 million in 4 rounds of funding. It’s not clear what earlier valuation Tapad had earlier than its exit.
Tapad was backed by Spring Capital (which owned forty six.5% of the corporate), FirstMark Capital, Firsthand Know-how, Avalon Ventures, WPP and Metamorphic Ventures. Traasdahl, notably, is the president of Spring Capital, in accordance with his LinkedIn profile.
Tapad was based in 2010 and focuses on cross-gadget advertising know-how: it tracks what it says are billions of knowledge factors throughout a number of screens — assume cellular, PC, TV, and extra as they arrive to market like watches, automobiles and so forth — to realize a greater sense of the place shoppers are going and what they’re doing on-line.
It then packages and sells that info to media consumers, manufacturers and different advertisers with a purpose to create higher focused promoting, to feed into what Tapad estimates is a $one hundred sixty billion digital promoting market.
As cellular carriers face growing strain on their core, legacy providing of voice providers, and primary knowledge will get cheaper and cheaper for shoppers and turns into a thinner margin enterprise, these carriers wish to add extra providers on prime of the community, leveraging their very own subscriber bases however probably additionally offering providers that work throughout different networks, too.
“With the acquisition of Tapad, Telenor Group is taking a place inside the quickly rising marketplace for promoting know-how, and securing necessary competence inside digital advertising and analytics. I consider vital worth could be created from making use of advertising know-how to enhance the digital capabilities of our core telecom enterprise. This can enhance our understanding of buyer behaviour, and helps constructing a platform for different enterprise areas,’’ says Sigve Brekke, Chief Government Officer of Telenor Group, in a press release.
That is Traasdahl’s second exit: beforehand he bought a music startup referred to as Thumbplay to Clear Channel, the place it turned part of iheartradio (after which in 2014 Clear Channel renamed itself to iHeartMedia to mirror its wider strategic course).
There was lots of warmth over the advert tech business and the way it probably compromises consumer privateness. And on prime of that, the huge quantity of concentrating on, pinging and cookies make the expertise of utilizing providers very sluggish and knowledge-heavy, which has led to the rise in reputation of advert blockers. For what it’s value, Tapad says that its System Graph respects knowledge privateness, working with anonymized knowledge.
It seems like Telenor primarily intends to make use of the tech throughout its personal footprint, which isn’t solely in Norway, as its identify may suggest: the corporate can also be very lively in rising markets like Vietnam and Burma, the place cellular networks are solely simply beginning to hit the large time with providers that aren’t value-crippling to the overwhelming majority of residents.
“We’re thrilled to hitch the Telenor household. With greater than 200 million cellular subscribers in thirteen markets, Telenor is likely one of the largest and most profitable telecom corporations globally. I’m excited by what this acquisition means for our staff, our companions and our continued progress. It will speed up our imaginative and prescient to turn into the worlds’ main supplier of unified digital advertising options,” Traasdahl stated in a press release.
However this doesn’t imply that Telenor will solely be utilizing the know-how for its personal viewers of subscribers: Tapad says it really works with one hundred sixty of the highest U.S. manufacturers and has inked 50 knowledge know-how licensing partnerships. In 2015, the corporate is predicted tasks it should have revnues of $fifty seven million, up 70% versus 2014. It’s nevertheless loss making with a unfavorable EBITDA of $12 million. It forecasts 2016 revenues of $ninety million, and “Telenor expects Tapad to succeed in EBITDA break-even in 2017.” Tapad has roughly one hundred sixty staff, with workplaces in thirteen key cities within the U.S. and Europe.
“Telenor’s ambition is to ship a broad vary of related, personalised and interesting digital providers for our clients, in addition to to enhance effectivity by additional digitizing our core enterprise, together with essential areas like gross sales, advertising and distribution,” the service stated in its assertion on the deal. “Telenor has beforehand taken positions inside new digital enterprise areas inside the Web of Issues, On-line Classifieds and Monetary Providers. The acquisition of Tapad will give Telenor a strong place inside promoting and advertising know-how and strengthen Telenor’s knowledge analytics capabilities considerably.”
Tapad will function as a stand-alone firm underneath Telenor. Traasdahl, the present CEO, and Liodden, CTO, will keep their positions. The corporate has one hundred sixty staff.