VideoAmp Raises $275 Million as It Aims to Accelerate Growth

October 21, 2021

Media measurement company VideoAmp Inc. has raised $275 million in a series F round of funding as it pursues its efforts to take a slice of the media measurement business dominated by Nielsen, the company said.

The round, led by Spruce House Partnership, values VideoAmp at $1.4 billion, the company said. That is a significant increase since 2019 when it reached a $200 million valuation after raising $50 million from Raine Group LLC, according to a person familiar with the matter.

Investors in the latest round, which also include D1 Capital Partners LP, Tiger Global Management LLC, EPIQ Capital Group and Ankona Capital Partners, now collectively own about 17% of the company. That percentage could change if VideoAmp uses a portion of its new funds to repurchase shares from earlier investors, the company said.

VideoAmp helps advertisers target and measure the impact of their ads across platforms such as TV and mobile. The latest round is meant to help the company compress a three-year plan for growth into one year as it aims to serve more clients seeking non-Nielsen measurement tools, said the company’s Co-Founder and Chief Executive Officer Ross McCray.

“The ecosystem is asking for alternative currencies,” he said, referring to metrics that advertisers and media sellers use to set performance goals and cinch ad deals.

VideoAmp historically sold its media planning and measurement software and tools to ad buyers. Now the company also wants to bolster its operations servicing the media side of the business. The company, which this year increased its headcount to nearly 300 people from about 175, wants to add hundreds of more employees across sales and engineering, among other roles, said Mr. McCray.

Nielsen Holdings PLC has been the dominant player in media measurement for the better part of a century. TV ad buyers and sellers rely on the company’s commercial ratings to set goals—reaching a certain number of 18-to-49-year-old men, for example—and close deals based on those targets.

But challenges with Nielsen’s traditional TV panel, including a pandemic-related undercounting of viewers, recently prompted the industry’s measurement watchdog to pull the company’s accreditation for its national TV ratings.

A number of media companies and ad buyers continue to work with Nielsen but have also been pushing for alternative measurement options, especially as TV networks invest in streaming, which allows for new ways to measure TV viewing.

ViacomCBS Inc. this month said it would work with VideoAmp as one option for advertisers to plan, measure and make deals on their campaigns, a departure for a large TV media business that typically relies on Nielsen.

“It was clear to us that the status quo of media measurement and currency is broken and needs to evolve given the size of the market and the technological capabilities available today,” said Ben Stein, managing partner of Spruce House.

VideoAmp said it also entered a financing agreement with Capital IP Investment Partners earlier this year for up to $75 million in debt.

-Republished from the Wall Street Journal

 

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