Entrenched Among Mobile Exchanges, Metamarkets Sets Its Sights On Agency Trading Desks

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metamarketsMetamarkets founder and CEO Mike Driscoll is wary of describing his company’s technology as a “Bloomberg Terminal” for online advertising. Though it’s a shorthand used by Khosla Ventures, a Metamarkets investor, Driscoll steps cautiously around it.

“It’s not our place to analogize our products and services,” he said. “It’s a seductive metaphor, but it was Ari Paparo [a Google, Nielsen and AppNexus alum] that said analogies from the financial markets to the media markets can be dangerous.”

Driscoll described Metamarkets, which through four rounds of funding has netted $28.5 million, according to CrunchBase, as a SaaS analytics platform designed to help a range of companies make sense of media transactions. Its biggest customers have been mobile exchanges and supply-side platforms.

Last week, AdFin – which like Metamarkets bills itself as an analytics and business intelligence (BI) tool for online media – described its aspiration to create a data pool enabling views of a broader market. This isn’t Metamarkets’ value proposition, however.

“There’s no pooling of data that occurs at Metamarkets,” Driscoll said. “The exchanges that work with us provide us with real-time feeds teed off directly from their systems.” Essentially, clients provide Metamarkets the data, and Metamarkets processes it in real time.

“The market we serve most effectively have been the SSPs and exchanges, particularly the mobile guys,” Driscoll added, ticking off Chartboost, Millennial Media, Inneractive, Yahoo’s Flurry, Twitter’s MoPub and Smaato as the company’s “most active and healthy commercial relationships.”

Driscoll spoke with AdExchanger.

AdExchanger: How do your clients use you?

MIKE DRISCOLL: We allow exchanges to get operational awareness into the health of their buyers, the DSPs, and help them understand the yield the publishers are getting. When you’re running an exchange or a marketplace, the scale and complexity of programmatic data is unprecedented.

To make an analogy to the financial markets and how different it is to the media markets, the New York Stock Exchange has 30 billion trades that occur on it every day. By our estimates, there are about 400 billion transactions that occur daily on the programmatic markets [while] there are only a few thousand equities traded on an exchange [in the financial markets].

If you look at the media markets, how many unique audiences are out there? It’s almost an infinite number. You’ve got billions of people moving around the globe through time, space and constant context. Making sense of all that data is a real challenge. Inneractive is one of our most recent clients that said Metamarkets has helped increase revenues by over 100% in 2014.

Who are your biggest competitors?

The dominant competition we see are clients who have built [BI tools] themselves or are thinking of working with a more traditional BI vendor. We see a form of the reporting stack using something like a Hadoop, Vertica, Tableau – these are generic tools they can purchase or buy and then stitch together on their side to have reporting and visibility into their data.

When Metamarkets comes in, is it generally to rip and replace or supplement an existing stack?

There are two kinds of folks we work with. There are those who recognize the challenges of building a full-stack reporting solution and intentionally decide not to do it. MoPub is an example of that. Jim Payne came to us not long after getting MoPub started and from his past experiences, decided this was not something he wanted to build.

A second type of folks have made a commitment to build a full-stack reporting solution in-house. There are very few folks we’ve worked with who are happy with the results of their internal analytics efforts. I think that most companies vastly underestimate the challenge of building a reporting solution in-house so we have several clients that come to us, having gone 12 months down the path attempting to architect and build a reporting system, and ultimately abandon that path.

Why do they bail?

Building a big data analytics solution is something engineers love to do. You often find a lot of enthusiasm inside organizations when they have to choose what to build in-house and what they want to partner. A financial system or a CRM system isn’t sexy, but a full-stack interactive visualization of a billion data points, or in our case 10 trillion data points, is a hot space. Engineers and technologists love the idea of building a reporting tool.

The second reason is some folks feel they may need to differentiate with analytics and reporting and therefore it’s something they can’t outsource. The clients we work with don’t believe that. I don’t think our clients have been slowed down in any way.

Why do you have so much presence with the mobile exchanges?

Because mobile is the newest, most of the exchanges are really interested in time to market. The mobile exchanges see us as an accelerator in getting to market. Because it’s greenfields, the need for speed is greater.

The second reason is that there’s been a lot more embrace of standards on the mobile side. Open RTB has been much more strongly established among the mobile marketplaces. Because we work across many different marketplaces, it makes it easier for us to work with clients in mobile. They have a stronger embrace of standards and the data they send us. There’s a lot of plumbing that goes into working with the scale and complexity of data in programmatic. Because the plumbing in mobile is newer, it’s a bit easier for them to work with a partner like us.

Finally, this is a small ecosystem. As we’ve gained a reputation for serving mobile exchanges and as those exchanges began using us to report to their buyers and sellers, that’s created awareness of us among mobile marketplaces.

When your break down your clients by type, are the mobile exchanges the biggest group?

It’s well known that mobile exchanges have been the strongest adopters of Metamarkets, though we serve exchanges more broadly. OpenX is one of our longest standing clients as a traditional display SSP.

What’s not well known is that agency trade desks are our fastest growing client segments and are the largest segment we serve.

Most of the agency trade desks don’t already have very mature BI or analytics solutions?

Speak to some of your agency trade desk colleagues and ask them how happy they are with the quality of the analytics and reporting they’ve got. There’s been a tremendous amount of investment in terms of getting these solutions. As the founding CTO here, I thought it would take us a few months to build the reporting solutions we’ve built. Instead it’s taken us over three years and tens of millions of dollars to build it.

How many agency trade desks currently deploy Metamarkets?

No comment.

Do the different types of ad tech companies you work with have different needs?

We offer visibility. The truth is that simply having clear visibility into a vast number of media transactions is an enormous challenge. Certainly the exchanges feel that challenge most directly, but buyers want to have visibility into the markets they buy on. And today, most DSPs are basically sitting on top of a fire hose if they’re plugged into many exchanges. A buyer has to evaluate 400 billion microtransactions daily across all of these markets. This is arguably the most complex market the world has ever created.

So what are their needs? There’s similarity in that they’re looking to understand what are the audiences out there, how much do they cost, what are the characteristics of those audiences.

How many clients and how many employees do you have?

We’ve got dozens of clients and we’ve got 50 employees based in New York and San Francisco.

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