District M and Sharethrough to Merge as Ad-Tech M&A Shows No Sign of Slowing

Blink, and you just might miss the latest ad-tech merger. Supply-side platforms District M and Sharethrough are joining as the sell-side of the industry continues to rapidly consolidate. The two companies are merging to remain competitive in what’s increasingly becoming a commoditized market dominated by tech behemoths, all while the buy-side looks to work with fewer SSPs. “The name of the game is scale,” said Dan Greenberg, CEO of Sharethrough. Both companies’ offerings are complementary, and combined they’ll form an omnichannel exchange. District M has strengths in display and mobile, while Sharethrough’s offerings are mostly in native advertising, along with video. However, the combined company still has a lot of catching up to do. Kevin Mannion, president, chief strategy officer of Advertiser Perceptions, laid out the SSP landscape: Google sits atop the list as the most ubiquitous platform, and Amazon leads tier two. Meanwhile, the likes of Magnite (which last week bought SpotX to compete with Google and Amazon), Verizon Media, Index Exchange, PubMatic and OpenX make up tier three. “It is hard to see, short term, any combination of SSPs that are trailing in the third or fourth tiers … be competitive,” added Mannion. SSPs are also coming under threat from a more judicious buy-side, as marketers direct more of their dollars through fewer platforms in order to make their digital supply chains more efficient. SSPs without scale or expertise in valuable areas, such as connected TV, often don’t make the cut. “Being able to combine these two strengths [plays into] our vision to really develop an omnichannel offering because advertisers right now want to review their supply chain and really work with scaled partners,” said JF Cote, CEO of District M. Cote will become CEO of the combined company, with Greenberg becoming president. The merger is expected to close in the coming weeks. Both Cote and Greenberg said their companies were profitable in 2020. As part of the merger, District M raised $19 million to invest in growth areas, like boosting the company’s CTV and instream video offerings. The combined company will have over 140 employees across eight offices in the U.S. and Canada. Cote said the new company is not planning layoffs and instead is looking to “hire a lot of people in all different fields.” Sharethrough, founded in 2008, was one of the first native ad-tech companies. The San Francisco-based SSP has raised $28 million to date. Greenberg said his company was unprofitable during a “build mode” phase from 2014 to 2019, but it turned the corner in 2020, especially after digital advertising activity ramped up by the end of the year. District M, a Montreal-based SSP, has raised $30 million ($39 million CAD) since its founding in 2013. “As a combined company, the financials are in a really strong place,” said Greenberg.