Peter Kafka

Recent Posts by Peter Kafka

Another Big Ad Tech Bet? Yup: DataXu Raises $27 Million.

a-big-fat-wad-of-moneyHere’s yet another ad tech company raising a bunch of money, long after everyone said that investors are done with ad tech. Today’s example: DataXu, a four-year-old Boston company that’s announcing a $27 million round led by Thomvest Ventures.

Previous investors including Atlas Venture, Flybridge Capital Partners and Menlo Ventures are back as well; DataXu has now raised $65 million.

DataXu started out in life as one of many “demand side platforms” that helped marketers place their ads in “real time” ad exchanges and took a cut of the media they bought.

Now CEO Mike Baker says the bulk of his revenues comes from software he licenses, which is supposed to let ad buyers navigate that world on their own.

DataXu’s giant round is one of many we’ve seen in the last year. Last month, for instance, ad platform AppNexus pulled down $75 million; in June, publisher platform PubMatic rounded up $45 million.

All of these companies play in different parts of the complicated ad tech landscape, but all of these big dollar bets are headed in the same direction: Their investors think they’re going to end up bulking up — via growth and M&A — and going public.

A lot of these guys have now raised so much that they don’t really have any other option. At one point investors were assuming that all sorts of acquirers would step in and snap these guys up, but aside from Google and Adobe, most would-be acquirers have sat on their checkbooks. But some optimists/bankers are hoping to entice Yahoo and/or Facebook to come to the table…

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Just as the atom bomb was the weapon that was supposed to render war obsolete, the Internet seems like capitalism’s ultimate feat of self-destructive genius, an economic doomsday device rendering it impossible for anyone to ever make a profit off anything again. It’s especially hopeless for those whose work is easily digitized and accessed free of charge.

— Author Tim Kreider on not getting paid for one’s work