Mooreland Partners Reveals Mobile Advertising Market to Surpass Record Highs with M&A Transactions and Venture Investments in 2013

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Report shows a market that is projected to reach over $13 billion in 2013 and has seen over 20 M&A Transactions & 50 Investments in 2013 YTD.

“Today, mobile is the third largest digital ad format, rapidly taking share of both consumer time and marketing dollars from other digital advertising formats,” said Todd Feldman, Managing Director at Mooreland Partners.

Mooreland Partners LLC, the leading global M&A advisory firm in middle market technology, today released its Mooreland Monitor on Mobile Advertising, detailing recent developments which have enabled the market to meet its potential. The Monitor includes highlights on the current state of M&A and investment activity, and highlights several “hot spots” and key value drivers.

Since 2008 the mobile advertising market has overcome both structural and economic factors that delayed initial traction. As the world recovered from a global recession, several industry developments such as smartphone penetration, the emergence of tablets, the expansion of mobile ad units, enhanced targeting, and a shift in how people consume media has enabled the market to exceed expectations of industry analysts—making it an attractive market for acquirers and investors.

Worldwide mobile ad spend is projected to reach $13.6 billion by the end of the year, reflecting 62% growth over 2012.

“Today, mobile is the third largest digital ad format, rapidly taking share of both consumer time and marketing dollars from other digital advertising formats,” said Todd Feldman, Managing Director at Mooreland Partners. “The open IPO window and continued venture investment is supporting growth in the sector - and significant M&A activity is being driven by the on-going need for market leaders to fill certain product gaps and achieve scale.”

Market Trends

Early on, the exit market for mobile advertising companies was highly bifurcated, with premium transactions clearly separated from the rest. Beginning in 2010, valuation metrics for large and small deals alike began to converge.

Over the past 24 months, a number of adtech companies have taken advantage of the IPO window providing additional data points that support M&A trends and set go-forward market expectations.

With 21 M&A transactions year-to-date, Mooreland expects year-end deal flow to surpass the historic high set back in 2011.

On the investment front, Mooreland expects a heavy fourth quarter in terms of volume, consistent with historical trends, leading to 80+ investments by the end of the year—and a new high for the industry.

2014 “Hot Spots” to Watch

Based on discussions with key constituents in the mobile advertising ecosystem, Mooreland believes a handful of trends and segments will drive activity in 2014:

  •     Performance-driven models (CPI, CPA, etc.)
  •     Social analytics, intelligence, and the monetization of social data
  •     Real-time bidding & exchange platforms
  •     Revenue optimization and media buying solutions
  •     App discovery and recommendation

About Mooreland Partners

Mooreland Partners is the leading global M&A advisory firm in middle market technology. It provides global Mergers & Acquisitions advisory services to the Digital Media, Enterprise Software and Services, Communications Technologies as well as Industrial Technologies and Electronics industries. With offices in Silicon Valley, Greenwich (CT) and London, Mooreland Partners is an integrated global firm owned by its partners. It offers its clients unparalleled access to strategic buyers and investors around the globe. For more info visit: http://www.moorelandpartners.com

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Kyle Austin
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