Videology, an ad-tech firm that was once loved by investors, is looking for a buyer as Google and other tech giants dominate the industry

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  • Video-ad specialist Videology is up for sale. It has tapped the digital media advisory firm Luma Partners to help find a buyer.
  • Videology has built out a set of tools to help take advantage of the expected growth in 'advanced TV' advertising, where TV ads are sold using data and software.
  • But it will be tough for Videology - which has raised close to $200 million - to recoup its investment as the number of potential acquirers narrows amid a wave of ad tech consolidation.
  • Two of the company's biggest partners - 21st Century Fox and AT&T - are tangled up in other deals that could keep them from making a bid. Other obvious buyers have competing interests already.


Videology, a maker of software used to place video advertising, is looking for a buyer, Business Insider has learned, as ad-tech power continues to consolidate among the largest players in the technology industry.

Videology helps both ad buyers and media companies place ads using software and data. It has hired the digital media advisory firm Luma Partners to help facilitate a sale, according to people familiar with the matter. Executives Videology and Luma declined to comment.

Founded over a decade ago, Videology has raised roughly $200 million from investors. Back in 2013, the company nabbed $60 million in series D financing when the ad tech sector was percolating. As recently as 2014, Videology was mulling an IPO, Business Insider reported.

Yet by early 2016, Videology let 8% of its workforce of about 400 employees go, reported AdExchanger. Then, last August, the company raised an $80 million credit facility via the financial technology firm FastPay and Tennenbaum Capital Partners.

It won't be easy for Videology to fetch a price that will allow it to fully pay back its investors, let alone provide a big return, say people with knowledge of the financials. One of the people said it is asking $500 million, but it's unlikely to get that much.

That's in part because the majority of Videology's revenue comes from its 'video ad network' business, via which it helped web publishers and advertisers book videos ads. That business is declining, say people familiar with Videlology's financials, and Videology's 2016 revenue was down versus 2015, they said.

Problematic acquirers

More recently Videology has leaned into building tools and services designed to help fuel the growth of 'advanced TV' advertising- as TV ads are expected to increasingly be sold using richer data sets designed to mimic the precision ad targeting common in digital media to TV (e.g. showing car ads to people currently looking to buy new cars).

"They have gotten very good at TV analytics," said Lorne Brown, president of SintecMedia a company that provides tools and services to TV companies designed to help manage their advertising and improve yield. "and helping advertisers find the right audiences on linear TV and other places. They can help extend your reach."

But that advanced TV ad market is still fairly nascent. And many big TV companies like NBCUniversal are focused on building their own proprietary offerings.

The list of potential buyers is quickly shrinking as digital power becomes concentrated among a few giants - and many independent ad tech startups sell for paltry amounts compared to previous valuations (Rocket Fuel is the best example of this).

Two of Videology's biggest partners have suddenly become problematic acquirers. 21st Century Fox, which has used some of Videology's tools to help build out its own data-driven ad operation, is in the middle of selling many of its assets to Disney.

Similarly, AT&T has worked with Videology to sell linear TV ads 'programmatically." Yet even as AT&T says it wants to move aggressively in the 'addressable TV' ad space, it's deal for Time Warner is being held up in court by the US government.

A handful of other potential Videology buyers could make sense, but many have competing interests. For example:

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