Subscribe to MarTech Today to receive news and insights of where marketing, technology, and management converge.

Note: By submitting this form, you agree to Third Door Media's terms. We respect your privacy.

Martech M&A: Sizmek acquiring Rocket Fuel to combine programmatic platform capabilities

Rocket Fuel will become a private company once again.

Ginny Marvin on July 18, 2017 at 2:08 pm

Adtech firm Sizmek announced it has agreed to acquire Rocket Fuel, the predictive ad optimization platform that went public in 2013.

Mark Grether, Sizmek executive chairman, said the merger will result in the “largest independent marketing platform built for agencies and brands.”

“With the integration, you’ll gain access to a leading DSP and DMP [demand-side platform and data management platform] and the most robust dynamic creative optimization and ad serving capabilities all under one roof,” Grether said in a company update emailed to customers Tuesday.

Sizmek offers dynamic ad personalization and says it is the largest independent ad server, with over 42,000 advertisers, agencies, publishers and trading desks in its network. In January, Sizmek launched a data hub that integrates with data management platforms so that dynamically created ads can be targeted to DMP audience segments.

Rocket Fuel has seen its stock price tumble since its high-flying 2013 IPO at which its stock debuted at $29 and jumped to nearly $60 per share. The company reported non-GAAP net revenue fell 24 percent year over year in Q1 2017 to $47.4 million and projected Q2 non-GAAP net revenue spread of $42-$48 million. Rocket Fuel has been transitioning from a managed services-based company to a SaaS (software as a service) platform-based model over the past several quarters.

“By integrating with Sizmek, we’re effectively combining the powerful brand-building insights delivered via our Predictive Marketing Platform’s Decision Engine with Sizmek’s creative optimization platform,” said Randy Wootton, CEO of Rocket Fuel in the announcement. “This union creates one integrated, full-funnel solution to enable agencies and their brands to address key performance objectives across paid, owned and earned media.”

Combined, the companies say they service more than 20,000 advertisers and 3,600 agencies to audiences in over 70 countries.

With the dominance of Google and Facebook in programmatic advertising showing no signs of abating, the market may see more consolidation among independent ad tech companies looking to gain muscle. Snap has been rumored to be looking to build up its own programmatic capabilities, eyeing AdRoll.

Sizmek itself was acquired last August by Vector Capital. The private equity firm’s cash offer values Rocket Fuel at roughly $145 million, at stock price of $2.60 per share. The deal is expected to close this quarter, though Rocket Fuel has a 30-day window to solicit other offers.

About The Author

Ginny Marvin

Ginny Marvin is Third Door Media's Associate Editor, assisting with the day to day editorial operations across all publications and overseeing paid media coverage. Ginny Marvin writes about paid online marketing topics including paid search, paid social, display and retargeting for Search Engine Land and Marketing Land. With more than 15 years of marketing experience, Ginny has held both in-house and agency management positions. She can be found on Twitter as @ginnymarvin.