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MiQ has entered advanced talks with potential new private equity backers


MiQ is in superior discussions over a possible majority funding Digiday has realized with sources indicating {that a} personal fairness agency has now been recognized as a potential principal backer of the advert tech agency which may very well be valued at near $1 billion.

The developments come 5 years after ECI Companions turned a minority stakeholder within the firm, then often called Media iQ, after it made a “important” funding – monetary particulars of the deal weren’t disclosed – in MiQ.

Since early 2022, the advert tech firm has engaged quite a lot of events, together with the M&A advisory arm of HSBC, over a possible cope with separate sources, all of whom requested anonymity because of industrial sensitivities, noting that a number of PE companies subsequently contacted trade consultants to raised assess MiQ’s worth proposition.

Digiday understands that current days noticed MiQ enter into superior discussions with a single PE agency with sources indicating any potential deal, which might see ECI Companions promote its stake within the firm, might shut within the coming weeks.

Key monetary MiQ stats

  • $600 million+ in revenues
  • $15.9 million in revenue (after tax) in 2020
  • Estimated valuation $800-$1 billion
  • U.S. revenues account for greater than 2/3 of whole group income

MiQ co-founders Gurman Hundal and Lee Puri, CEO and chief progress officer respectively, confirmed the corporate has spoken with a number of PE companies in current months though they declined to call any particular entities they’ve engaged with.

They informed Digiday any potential deal wouldn’t equate to the corporate “altering its trajectory” and that the pair would stay in situ long-term.

“The purpose of what we got down to do 12 years in the past is identical now,” stated Hundal, “and we wish to be doing that for many years to return.”

Puri added, “Discovering the proper companion that’s aligned with our values going to be a extremely essential a part of our future narrative and future progress.”

ECI Companions is a PE outfit whose specialty is investing in medium-sized corporations – usually these are “companies valued as much as £300 million” ($359 million) – after which serving to stated companies speed up their progress plans with a specific emphasis on “internationalization.”

The PE agency additionally claims U.Ok.-headquartered MiQ’s revenues have elevated by 240% within the U.S. since its 2017 funding and that the advert tech agency now additionally has a scaled presence in APAC and the Indian subcontinent.

Sharp income progress

Paperwork filed with Companies House, a registry containing audited data on U.Ok. corporations, throughout September 2021 state that MiQ’s 2020 turnover was $337.6 million (the majority of which was generated by its worldwide operations) equating to a revenue of $15.9 million after-tax.

Sources aware of developments at MiQ informed Digiday the advert tech firm’s revenues have grown significantly since 2020 and are actually comfortably north of $600 million. Separate events, all of whom requested anonymity, estimate that MiQ would possible be valued within the area of $800 million-to-$1 billion.

One supply who suggested a possible bidder described MiQ as “finest in school” including that it has managed to keep up a highly-skilled workforce (its headcount is within the area of 800) in a aggressive setting. In the meantime, one other supply made be aware of MiQ’s entry and subsequent fast progress within the U.S. market with ECI Companions individually claiming that “over 2/3 [sic] of total group revenue” is generated there.

MiQ is an organization that helps purchasers (usually a mix of media businesses and types’ personal promoting groups) conduct advert campaigns utilizing instruments corresponding to demand-side platforms or extra complete advert tech choices such because the Google advert stack.

Investments

In response to its September 2021 submitting, MiQ has additionally gone about investing in proprietary applied sciences together with its Analytics Studio, Intelligence Hub, and Dealer Lab. MiQ claims this know-how automates and optimizes purchasers’ campaigns throughout completely different sources of stock, and in the end underpins the providers it supplies to purchasers.  

Moreover, the papers additionally be aware that MiQ invested $1.1 million in a hotly tipped start-up that helps advertisers entry information in a privacy-compliant method known as Infosum.

Market observers preserve that such numbers place MiQ as one of many largest advert tech corporations initially based in Europe, a territory that has performed host to quite a lot of completely different offers within the sector throughout current months.

As an example, Mayfair Fairness Companions invested $120 million in LoopMe, whereas Well.io agreed to pay greater than $100 million for Advert-Lib.io (each offers have been introduced in January this yr) whereas Insider recently reported that fellow U.Ok. outfit BrainLabs was likewise searching for further PE funding.

In the meantime, Goodway Group’s advert tech consultancy arm bolstered its providing in current days with the acquisition of U.Ok.-headquartered Canton Advertising Options with AdExchanger reporting that Verve Group acquired cell DSP Dataseat to bolster its privateness wares earlier this week.

A pre-IPO personal fairness spherical?

Some imagine MiQ’s newest makes an attempt to realize additional monetary backing may very well be a precursor to a public itemizing as soon as the inventory markets recuperate from their present lull following the historic highs of 2021.

Regardless of uncertainties round elevated authorities oversight of using information, plus the relative downturn within the fortunes of advert tech on the general public markets, personal fairness teams are nonetheless within the area. That was the conclusion of a panel at this yr’s Digital Media Summit, hosted by LUMA Companions, with contributors suggesting cooling attitudes towards advert tech on the general public markets might current a chance.

Stephen Grasp, a principal at GTCR (an outfit with a majority stake in Simplifi and Commonplace Media Index) informed attendees that 2022 is “an amazing yr to be a PE investor in advert tech” as 2021’s surge of public listings within the area posed “a really formidable competitor for liquidity occasions.”

Now’s nearly as good a chance as any to ensure we’re exploring potential companies

Yicong Liu, CVC Capital Companions

He added, “I really feel that a variety of the buzzwords that get thrown round – like regulatory threat, [Apple downgrading] IDFA – are significantly better understood in 2022 than they have been final yr … valuations are (maybe) not essentially decrease, however you’re not competing towards the upper valuation options.”

Davis Noell senior managing director and co-head of North America at Windfall Fairness Companions (a bunch that owns Well.io and aided DoubleVerify in direction of its April 2021 preliminary public providing) famous the fluctuations in how the investor neighborhood valued advert tech over the past decade.

“The market is telling you a few issues, and one is that they don’t like unprofitable corporations,” stated Noell, including, “I feel yr so far, the worthwhile ones are down 25%, that hasn’t been yr, however the unprofitable ones are down 70% … however I feel will probably be yr performance-wise for advert tech, that can replicate once more within the inventory market.”

In the meantime, Yicong Liu, a director at CVC Capital Companions (a fund that helped dealer the acquisition of Vista Fairness Accomplice’s stake in Mediaocean), spoke of the potential for PE companies to pair completely different advert tech property collectively, after which search a possible exit.

“For the companies which are acquisitive, the place we see a variety of alternative for add-on, I feel now’s nearly as good a chance as any to ensure that we’re exploring potential companies we may very well be speaking to as a result of I do assume the general public markets have overreacted a little bit bit.”



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