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The rise of AI is influencing every corner of technology and marketing, and M&A is no exception.
Brian Andersen, managing director of investment advisory Atlas Technology Group, knows this better than most. He was also a co-founder of LUMA Partners.
Atlas has facilitated six deals this year alone, including Braze’s acquisition of agentic AI platform OfferFit, AI software company Uniphore’s purchase of customer data platform Action IQ and Rokt’s merger with CDP mParticle.
Perhaps most notably, Atlas also advised on Publicis’ acquisition in March of one-time data management platform Lotame.
All of these deals were driven by a common need for stronger data and identity capabilities to keep up with the changing data landscape – AI models depend on strong data platforms, and the software companies they acquire can benefit by using the latest AI to better reach their customers.
Andersen spoke with AdExchanger about how companies, both large and small, can stay abreast of these trends and strategically prepare for potential deals.
AdExchanger: What major shifts have you seen in ad tech over the past few years, and what catalysts led to those changes?
BRIAN ANDERSEN: One of the most notable trends is the deprecation of data, specifically cookies. This has forced companies to really focus on their first-party data by putting together data assets and CDPs and identifying places they can have second-party data relationships using data clean rooms.
Companies like The Trade Desk and ID5, among others, offer alternative IDs, which enable better targeting and measurement. And companies like mParticle grew to be good-sized businesses because they focused on first-party data, strong technology and good customer bases that enabled them to be acquired.
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But what about Lotame? Why do you think it wasn’t acquired sooner, when so many of its competitors were?
It’s hard to say why Lotame wasn’t acquired sooner. It was one of the original DMPs, and then that class of companies – Demdex, BlueKai, Krux, etc. – were acquired by Adobe and Oracle and Salesforce. All of those companies ended up deprecating their DMPs in favor of CDPs.
Since Lotame was independent, it really had to pivot its business. One of the things they excelled at was lookalike modeling and other data collaboration capabilities.
It was amazing to watch Lotame maintain its relevance in the market by continually modifying the product offering for the current environment.
What do people get wrong about M&A from the buyer’s perspective?
Buying companies is complex, but what’s more complex is actually integrating them successfully.
Integration doesn’t happen naturally. You need to actively work on it, identify where things are falling behind and make sure that people are measured on the success of the integration. If you don’t, there’s no reason to do the deal in the first place.
And what about mistakes from the seller’s perspective?
On the sell side, the biggest mistake I see is a company picking a time by which they want to be sold. It may sound simplistic, but I always say that buyers buy when they’re ready to buy. Trying to force yourself onto someone when they’re not ready to buy you is likely a losing proposition. The best time to sell is when an interest is established.
Getting interest from a buyer isn’t a passive activity, though. Focus on identifying the right buyers for you and establish relationships with them. For example, Braze and OfferFit knew each other. Their executives knew each other. They had joint customers. It’s those histories and relationships that really enable transactions to move forward.
The political situation is pretty volatile right now. How will tariffs impact the M&A environment for ad tech?
There are still a lot of strong drivers out there and buyers that are healthy in general. These are dynamics that would point to a strong M&A environment. But uncertainty is the enemy of M&A – and uncertainty has spiked now.
So if you’re an executive team thinking about hiring new employees or making significant capital expenditures, you’re likely to be more conservative. This includes M&A, because if a company is contemplating a $100 million transaction, they have to decide whether they would rather preserve that $100 million in case the market turns.
I do expect the M&A market to soften because of the uncertainty, but it also enables opportunities for buyers that are more aggressive.
The quantity will be reduced, but there will be transactions – there always are.
This interview has been lightly edited and condensed.
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