MediaMath, a demand side platform, filed for Chapter 11 bankruptcy last Friday. Over 300 employees were made redundant, bringing an end to a turbulent period for a company once regarded as one of programmatic advertising’s brightest and most promising stars. The closure came as something of a shock for many of the employees, but also to clients as campaigns were paused and access to the platform cut off immediately.
Over the weekend, agency clients of the now defunct DSP were scrambling for alternative partners as they enter a fresh month of campaigns. However, one agency executive told VideoWeek that the transition wasn’t quite as difficult as some feared. They said that it was mostly straightforward and that other DSPs provide them the same service as MediaMath, which made it relatively easy to put contingency plans in place. The timing – coming at the end of both the month of June and the end of Q2 – also helped to minimise the level of disruption, as traders were able to simply set up July campaigns in alternative DSPs.
The news follows a rocky few years for the New York ad tech firm, which has explored a sale since 2020. Verve Group was reportedly in discussions to acquire the company last week before talks fell through on Thursday. Viant was also in the frame earlier this month, again without reaching a deal. Amazon, IPONWEB, Magnite and Tremor have all been linked to a takeover over the years.
“No one else would”
MediaMath was forced to refinance last year, after a period that resulted in founder Joe Zawadski being ousted as CEO. Searchlight Capital Partners then took a controlling stake in the company, a move that wiped out the equity of Series A and B investors, according to Insider.
“Since investing in MediaMath, we have done all we could to stabilise the business and secure its legacy for the company and, most importantly, its employees, including infusing additional capital into MediaMath when no one else would,” Searchlight Capital said in a statement.
“Unfortunately, due to a variety of reasons, this was not enough to preserve the company and we are disappointed that the proposed sale has not materialised. We will continue to work with all stakeholders through this difficult time to unlock as much value as possible for all involved.”
Doing the math
MediaMath was founded in 2007 and raised $600 million, reaching a valuation over $1 billion. The company was acknowledged as one of the original DSP players, and subsequently a viable alternative to Google’s DV360. But the firm’s fortunes have waned with the rise of large rival The Trade Desk, and now owes up to $500 million in liability costs.
The bankruptcy filing reveals that the company owes money to between 200 and 999 creditors, including a fairly comprehensive list of major ad tech businesses, and the firm’s rent for its World Trade Center offices. The 30 companies owed the highest amounts are:
- Magnite: $12,585,259.99
- Pubmatic: $10,479,620.09
- Sonobi: $5,307,213.23
- Xandr: $4,014,169.96
- Adswizz: $3,413,217.97
- Smart Adserver: $3,371,083.93
- TripleLift: $2,792,438.13
- Azerion: $2,555,290.19
- 4 World Trade Center: $2,511,572.86
- LiveRamp: $2,297,556.89
- Index Exchange: $2,175,479.54
- OpenX: $1,910,582.52
- Google: $1,691,699.43
- DoubleVerify: $1,490,134.27
- GumGum: $1,436,498.02
- Unruly: $1,379,280.71
- Madhive: $1,290,559.85
- Grapeshot: $1,186,375.93
- Presidio: $1,144,175.31
- Yahoo: $1,139,511.20
- Yieldlab: $1,136,708.97
- Eyeota: $1,097,126.07
- T-Mobile: $1,054,780.11
- Gravy Analytics: $884,895.98
- Google Affiperf: $883,308.25
- Foursquare Labs: $862,389.71
- AdColony: $825,777.89
- FreeWheel: $788,142.81
- BidSwitch: $733,586.00
- BlueKai: $726,923.40
The business was also in the process of paying back a $150 million loan from Goldman Sachs, which it took in 2017. As part of bankruptcy proceedings, Goldman Sachs will be paid back after paying out remaining wages and selling the company’s assets.
