Ad-Verification Firm DoubleVerify to Acquire OpenSlate for $150 Million

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Deal expands DoubleVerify’s brand-protection and ad-verification services to social-video platforms such as YouTube, Facebook, TikTok

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DoubleVerify said the deal, expected to close this quarter, includes $125 million in cash and $25 million in stock.

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The addition of OpenSlate will expand DoubleVerify’s services to social-video platforms, including YouTube, a unit of Alphabet. Inc. NS

Google; Facebook,

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Owned by Meta Platforms Inc.,

and ByteDance Limited’s Tiktok. DoubleVerify already helps advertisers avoid negative content when they use automated technology to buy ads on the open web—not through closed platforms like Facebook, for example.

Advertisers who use automated technology to send targeted digital ads often have less control over where their ads will reach than when they purchase directly through a publisher.

While DoubleVerify has tools to measure the security of advertising campaigns on social media, the OpenSlate deal adds the ability to ensure that digital ads are not first sent to unsafe content on these platforms.

“As more and more ad dollars go digital, they’re going into connected TV, they’re going into social video,” said Mark Zagorsky, chief executive officer of DoubleVerify. “It’s important to us to provide the same level of trust and security in the places where everyone spends their time.”

The deal is part of DoubleVerify’s goal to expand its geographic presence, size and slate of offerings to customers, as many increase their digital marketing spend and strengthen their vendor relationships and ad-buying approach, Mr Zagorsky said.

“One of the challenges with validation and brand-suitability measurement and filtering is that you can’t go small and do that,” he said. “We want a platform that can do everything.”

Its founder and CEO Mike Henry said this year OpenSlate had to decide whether to raise money and invest in growth or become part of a larger measurement company. “From the perspective of our customers, the decision just got a little easier,” he said. “They don’t want to work with a dozen different measurement companies. Media buying is becoming increasingly complex, especially in the social sector.”

Advertisers have cut their spending on platforms such as YouTube in previous years, with evidence that some ads were appearing with objectionable content, such as videos promoting terrorism and violence.

The rise of digital advertising and imminent concerns around the safety of digital media caused a wave of growth and interest in advertising-certification and -measurement companies. Private-equity firm Providence Equity Partners acquired a majority stake in DoubleVerify in 2017; software company Oracle Corporation

bought Moat in the same year; and in 2018 private-equity firm Vista Equity Partners acquired Integral Ed Science,

Additionally, digital ad spending accelerated during the pandemic, fueling interest in the broader ad-technology sector. When DoubleVerify made its public debut this April, its stock opened 30% higher than its initial public offering price, valuing the New York-based company at more than $5 billion.

OpenSlate’s 65 employees will eventually join the operations of DoubleVerify’s 760 employees.

While OpenSlate’s services are largely complementary and the deal is not a “cost-cutting acquisition,” there may be some reduction in overhead, Mr. Zagorsky said.

Alexandra Bruell at [email protected]

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