MediaMath reduced its workforce by 8% through a combination of layoffs and furloughs due to the economic impacts of the COVID-19 pandemic.
Remaining employees will take a 10% pay cut and MediaMath paused 401(k) matching.
“We are preparing our businesses to weather these uncertain times and taking actions that will strengthen our position for the long term, including focusing our hiring efforts on critical positions only, reducing expenses and compensation, and reducing roles as necessary,” MediaMath President Konrad Gerszke said in a statement.
The DSP employs 659 people, according to LinkedIn, making its pre-layoff head count about half the size of its rival The Trade Desk.
DSPs charge a percentage of the media spend flowing through the platform. So as advertisers halt or cut spending due to the pandemic, their revenue falls in lockstep with those declines.
And the declines have been sharp. An IAB survey last week reported that 33% of brands expected to spend less on digital media between March and June. And a full three-quarters of brands either paused or decreased spend due to the pandemic.
Even before COVID-19 hit, MediaMath faced significant challenges in a highly competitive DSP market. For instance its rival the Trade Desk, which went public in 2016, has grown aggressively. MediaMath’s fortunes are less clear, and it has raised more than $600 million since its founding, giving it a high price tag for potential acquirers. It also raised $180 million for unnamed acquisitions in July 2018 that never materialized.
Recently, MediaMath has focused on curating supply for publishers. Its SOURCE project, which debuted in October 2019, creates a cleaner, verified pool of inventory for buyers and speaks to their desire to do supply-path optimization. And its DSP toolset is generally regarded as more sophisticated than The Trade Desk’s, giving it a niche with buyers that want more granular programmatic controls.
The company is far from alone in making layoffs and pay cuts. AdExchanger is tracking the full rundown of companies with workforces affected by the coronavirus here.
