M&A Alert—April 18, 2017
Oracle acquires digital ad impression measurement company Moat for $850 million.
Author: Eric Risley, John Ascher-Roberts
Transaction Size: Undisclosed
Moat provides a cloud-based platform that major brands and publishers use to track the effectiveness of their advertising and marketing campaigns. Moat Analytics tracks ad impressions and content views across mobile apps, social networks, connected TVs and other sources. It then synthesizes that data into a single dashboard, offering customers actionable insights to measure effectiveness and help tune their marketing efforts. Customers include over 600 publishers, brands and agencies including major brands such as Nestle, Procter & Gamble and Unilever and publishers such as Facebook, ESPN, Snapchat and Youtube. Competitors include comScore, Integral Ad Science, Chartbeat, and AdClarity.
Jonah Goodhart, CEO, and Noah Goodhart co-founded the New York-based company in 2007. The company received $67.5 million in funding from investors including Advancit Capital, AFSquare, Bowery Capital (Mike Brown Jr.), First Round Capital (Christopher Fralic), Founder Collective, Founders Fund, Insight Venture Partners, Lerer Hippeau Ventures, Mayfield Fund (Timothy Chang), MHS Capital, Softbank Capital, SV Angel, Third Kind Venture Capital, and Vast Ventures.
Oracle offers enterprises a wide variety of software and services to help run their business. Over the past couple of years, the company has been aggressively bolstering its Oracle Marketing Cloud through several acquisitions such as Crosswise and AddThis in 2016 ($50 million and $200 million, respectively), Datalogix and BlueKai in 2014 ($1.1 billion and $350-$400 million, respectively), Responsys in 2013 ($1.5 billion), and Eloqua and Vitrue in 2012 ($871 million and $300 million, respectively).
Oracle has a market capitalization of $182 billion and LTM revenues of $37 billion. Eric Roza, SVP and GM of Oracle Data Cloud, was the internal champion of this transaction.
Oracle is acquiring Moat for a reported $850 million.
Transaction Value: $850M
TV / Invested Capital 12.6x
Comparable transactions include Salesforce’s acquisition of Krux Digital in October of 2016 for $700 million (14.0x invested capital, covered in our M&A alert), Neustar’s acquisition of MarketShare Partners in November of 2015 for $450mm (7.9x LTM revenue, covered in our M&A alert), Acxiom’s acquisition of LiveRamp in May of 2014 for $310mm (11.0x LTM revenue, covered in our M&A alert), and Neustar’s acquisition of AggregateKnowledge in October of 2013 for $119mm.
This acquisition is a continuation of the arms race between major marketing cloud providers. While Oracle has been beefing up its Marketing Cloud in recent years, it still lags behind the major players such as Adobe, IBM, Salesforce, SAP and SAS according to Gartner’s recent magic quadrant of leading marketing software providers. In combination with offline data from Datalogix, publisher audience data from AddThis, and cross-device data from Crosswise, Moat will add important attention analytics and data to Oracle’s marketing cloud offering.
Architect Partners’ Observations
This week Kantar Media published a new study which highlights how critical ad measurement is becoming. As said by Andy Brown, CEO and Chairman of Kantar Media, “Without the availability of consistent, comparable metrics, brands and the advertising industry cannot accurately measure their audience, the impact and effectiveness of their marketing and the accuracy of individual campaigns. It’s a collective challenge for our industry…”