Ad tech isn’t every VC’s cup of tea. But some VCs love it – warts and all.
Eric Franchi and Joe Zawadzki, longtime ad tech entrepreneurs and now general partners at ad tech-focused venture capital firm Aperiam, fall into the latter category.
They both cut their teeth in ad tech, Franchi as co-founder of Undertone, now owned by Perion, and Zawadzki as co-founder and CEO of the ill-fated MediaMath.
Aperiam has invested in more than 70 ad tech startups since 2018, including Rembrand (virtual product placement), Scope3 (sustainable media buying), tvScientific (CTV performance advertising), Nodals AI (custom algorithms), Kevel (retail media ad server) and Firsthand (AI agent platform).
Meanwhile, several Aperiam-backed companies have already exited. Advertising metadata startup Sincera was sold to The Trade Desk in January and data management platform Audigent was bought by Experian late last year.
When Franchi and Zawadzki launched Aperiam seven years ago (it was called MathCapital back then), their goal was to support the next crop of early-stage digital advertising startups, and that remains core to the mission.
But it also makes sense to expand beyond the traditional VC model, Franchi told AdExchanger.
“We’re still a sector-focused fund for advertising and marketing technology,” he said. “But we feel like we have an opportunity to do something bigger, something that will allow us to be more helpful to our portfolio companies.”
Find me a find, catch me a catch
On Wednesday, Aperiam announced a new three-pronged approach that, beyond VC investing, also involves a strategic consulting practice and what Franchi referred to as an “orchestration layer” whereby Aperiam matches startups in its portfolio with brands looking for programmatic solutions.
“Our portfolio companies need exposure for their very specialized solutions, but it’s not always easy for them to get in front of the right people,” Franchi said. “We can help them do that.”
For example, Bell Media, a Canadian media conglomerate and broadcaster, is one of Aperiam’s clients. Last year, Aperiam facilitated a connection between Bell and one of its investment companies, a startup called Shopsense AI, which had SaaS technology that makes broadcast and streaming content shoppable. The two announced their partnership late last year.
Aperiam has also started advising companies on growth and strategy.
One of its clients is Advent International, a large private equity firm with a handful of notable advertising-related investments, including commerce platform Pacvue and data management and privacy platform BigID.
And another client is Infillion, the digital advertising company that bought MediaMath’s assets out of bankruptcy in 2023. Life truly is a circle. Zawadzki is now advising the company he founded and was later ousted from back in 2022.
“They’ve been really interested in tapping into Joe’s expertise, knowledge base and past vision,” Franchi said of Infillion’s leadership.
Entrepreneur archetypes
But as its client base and portfolio grow, Aperiam also needs more hands on deck.
The firm recently added two new managing partners, Corey Ferengul, the former CEO of Undertone, and Danilo Tauro, who has held leadership roles at Amazon Ads, Procter & Gamble and Uber.
After Undertone, Ferengul moved on to become CEO of AI platform Magnetic, which was acquired by Deloitte Digital in 2018. Tauro built out Amazon’s CTV practice, ran product management for P&G’s ad tech strategy and led advertising for Uber Eats.
“They’ve got real operating chops,” Franchi said.
But when it comes to the success of a venture, the personality and experience of the person receiving advice is as important as that of the giver.
There are two archetypes for ad tech founders, according to Franchi. One is the ad tech OG from the Programmatic 1.0 era. Think Brian O’Kelley with Scope3, Omar Tawakol with Rebrand and OpenX Co-Founder Jason Fairchild, who went on to co-found tvScientific.
And then there are those with what Franchi calls “extreme domain expertise and/or technical talent,” like Mike O’Sullivan and Ian Meyers, co-founders of Sincera.
Those are the folks Aperiam is actively looking for, Franchi said, repeat founders and people with deep experience in the ad tech sector.
VC you
Many VCs, however, are looking to actively avoid ad tech.
Sincera encountered “a fair amount of skepticism from several ‘generalist’ VCs and other investors, according to Meyers. These VCs had either been burned by investments they’d made a decade or more ago or they just didn’t have much experience in the space, he said.
But raising with Aperiam was a different experience.
When Sincera soft launched at an ID5 event in New York City in early 2022, Franchi was in the small audience that gathered, and he made a point to connect with Meyers and O’Sullivan.
“Eric was one of the very first people to get the potential of Sincera,” Meyers said. “When we were ready to raise a year and a half later, Aperiam was one of our first calls.”
TvScientific’s Fairchild can relate.
“Good VCs can help you make vital connections in the industry and add credibility,” Fairchild said. “For us, Aperiam has been like a well-connected, highly engaged extension of our BD team.”
