As digital marketers struggle to protect their brands, another ad tech company plans to go public
Amid all the uncertainty of digital advertising, another ad technology company is considering going public.
Digital advertising verification firm Integral Ad Science has filed regulatory documents for its initial public offering, making it the latest in a series of IPOs by digital advertising companies. The company, which goes through IAS, has filed its Form S-1 today with the United States Securities and Exchange Commission with the intention of debuting on the Nasdaq stock market under the symbol “IAS”.
IAS, which works with 35% of the top 150 advertisers in the United States, measures digital ad performance while processing an average of 100 billion web transactions every day. He hopes to capitalize on the growth of digital marketing on connected TV devices and programming channels. IAS also offers technology to help marketers prevent their ads from appearing alongside content related to alcohol, hate speech, drugs, violence, and certain news topics.
Since its creation in 2009, IAS, based in New York, has grown and employs 650 people in 11 offices in 8 countries. While the company was originally called AdSafe Media, it was renamed Integral Ad Science in 2012 and was acquired by Vista Equity Partners in 2018. It now has partnerships with a wide range of internet platforms including Amazon, Google, Instagram, Pinterest, Snap, Twitter. and Spotify, as well as digital advertising companies like The Trade Desk, Xandr, and Verizon Media.
The digital advertising market continues to grow. According to recent report According to research firm eMarketer, total spending on digital advertising will reach $ 455.3 billion in 2021, $ 524.31 billion by 2022 and $ 645.8 billion by 2024. Continuing momentum comes at a time when marketers are navigating the future of online data privacy and hyper-targeted ads like giants like Google are abandoning the use of third-party tracking. Meanwhile, other companies like Apple are giving users more control over what data they share and how it is used.
Despite the growth of the digital advertising market, IAS is not yet profitable. According to its recently released financial data, the company’s net losses totaled $ 32.4 million in 2020, up from $ 51.3 million in 2019. However, it managed to reduce the quarterly net loss to 2.8 million. in the first quarter of 2021 compared to a net loss of $ 14.4 million in the first quarter of 2020. Global revenues totaled $ 240.6 million in 2020, up from $ 213.5 million in 2019, and adjusted earnings before interest and taxes reached $ 56.4 million in 2020, up from $ 38.8 million in 2019.
“We believe there is a significant market opportunity to provide advertisers, agencies, publishers and platforms with measurement and verification solutions that address brand visibility, safety and suitability, prevention ad fraud, contextual targeting, reporting and inventory performance management, ”the IAS said in its filing. “Based on an analysis completed in March 2021 by Frost & Sullivan, we estimate the global market opportunity for our ad verification solutions at $ 9.5 billion and we expect it to grow at a CAGR of 16.2% from 2021 to 2025. In addition, we think we are doing well. poised to expand into the ad measurement and effectiveness market. There are opportunities for expansion beyond the existing use cases we currently serve, such as providing metrics of advertising effectiveness and efficiency to brands and helping them understand marketing performance.
IAS’s IPO plans come less than two months after rival ad measurement firm DoubleVerify debuted on the New York Stock Exchange and saw its shares jump 30% on the first day of trading. Other recent IPOs of digital marketing companies include mobile game company AppLovin, demand-side advertising platform Viant, sell-side advertising platform PubMatic, and web analytics company SimilarWeb. Content recommendation platforms Taboola and Outbrain have also filed for IPO, as have digital video ad technology company Tremor and marketing platform Zeta Global.
In an April interview on the DoubleVerify IPO, DoubleVerify CEO Mark Zagorski said the growth of ad fraud in industries such as CTV and social media continues to drive business activity in the industry. ‘businesses such as advertising performance monitoring. (The company also recently uncovered a complex ad fraud scheme involving over 2 million devices per day and costing advertisers over $ 5 million per month.)
“The margin game for our solutions continues to be driven by the fact that there are tons of frauds and they just get more aggressive in things like smart TV,” Zagorski said. “And brand safety concerns for large advertisers only become more intense depending on what has happened socially, what has happened economically and what factors are driving brands. to be as concerned with the broadcast of an advertisement as with what it actually says.
After SimilarWeb debuted on the New York Stock Exchange, co-founder and CEO Or Offer said in an interview that the IPO was also “a very effective way to position the brand for us.”
“If I look at why I decided to take the company public now, it’s overall the best time in the history of technology, SAAS and digital to get a company public,” said Offer. “Because all the digital transformation is here and our industry is developing extremely well, there is a lot of demand for the services we provide. “