- Ad verification company DoubleVerify plans to acquire adtech firm Scibids for around $125 million.
- It intends to use Scibids’ AI expertise to help advertisers better target and optimize ad campaigns.
- Scibids clients include major ad holding companies and advertisers like Diageo and Dell.
DoubleVerify, the publicly-listed ad verification company, has entered into an agreement to acquire AI-powered adtech firm Scibids in a cash and stock deal valued at $125 million.
DoubleVerify helps marketers avoid having their ads appear next to objectionable content and lets them verify that those ads were viewable to real people. Scibids technology uses the data generated by a marketer’s advertising stack to automate bidding in ad auctions and how much budget to devote to each campaign.
The pair first formed a partnership in June of this year to launch the “DoubleVerify Algorithmic Optimizer.” The product matches DoubleVerify’s media quality and ad performance data with Scibids’ AI algorithms to let advertisers improve the performance of their campaigns.
Scibids’ tech dramatically increased user attention levels and the number of impressions DoubleVerify won in ad auctions across several campaigns with Fortune 500 brands, DoubleVerify CEO Mark Zagorski said.
“We think there’s something really special there and we want it all to ourselves,” Zagorski told Insider.
Even before the buzz around generative-AI led by the likes of OpenAI and Microsoft late last year, adtech companies have long touted the use of artificial intelligence and machine learning to target and customize ad campaigns. These models have grown in popularity as platforms like Google and Apple wind down identifiers such as third-party cookies and mobile IDs that let advertisers track people across the internet.
Founded in Paris, France, in 2016, Scibids’ clients have included all the major ad holding companies as well as major brands like Diageo, Dell, Allianz, and Spotify.
Scibids was listed in Insider’s “most promising advertising and marketing tech startups of 2022, according to VCs” list. Experts said they selected Scibids because marketers are increasingly looking to new technologies such as AI to fine-tune their digital targeting as the industry moves away from tracking individual users.
While DoubleVerify is best known for its verification and brand safety tools, it also offers solutions that can target ads based on the types of content a marketer’s audience is consuming. These so-called activation solutions now account for around half of DoubleVerify’s business, Zagorski said.
Around $66 million of the Scibids purchase price will be paid in cash with the remainder in DoubleVerify common stock. There is an additional performance component should Scibids reach certain targets by the end of the year.
Scibids, whose roughly 70 staffers — including more than 20 AI engineers and data scientists — are all expected to move to DoubleVerify as part of the transaction, had previously raised $7.2 million in venture funding.
The acquisition jolts awake a sleepy year in adtech M&A. There were just 28 adtech transactions in the first half of 2023, down from 32 in the first six months of 2022, according to the investment bank LUMA Partners. Only four of those deals this year have been above $100 million, per LUMA’s date. Former LUMA partners Brian Andersen, Dick Filippini, and Mark Greenbaum advised Scibids on the DoubleVerify transaction — their last deal before leaving the bank this year.
Read the full article here