In the midst of the epidemic, the emergence of new media business models and the shift in privacy that came with iOS may seem like a terrible time to enter digital advertising and marketing. Nevertheless, we spoke to top venture capitalists who said they were still looking at investment opportunities. When we surveyed adtech and martech VC last summer, we focused on the effects of COVID-19. This time, we asked them to update us on whether the flow of their deals has been restored (said Eric Franchi of MathCapital’s, the last two quarters the firm still had several active ones) and to look at the possibility of additional controls and the most promising new equipment.
Control, they agreed, presents both risk and opportunity. For example, Christine Tsai of 500 Startups noted that as advertisers face more restrictions, “the easiest way for marketers to comply with these rules would probably be through software.” In addition, of course, we asked them what they were looking for in their next investment. You can read their full response below.
Here is whom we surveyed:
Eric Franchi, partner, MathCapital
Scott Friend, partner, Bain Capital Ventues
Christine Tsai, CEO and founding partner, 500 Startups
Digital advertising spend seems well on its way to recovering from the initial downturn during the pandemic. Are you seeing the same with adtech and martech deal flow?
Scott Friend: There seems to be a lot of activity in Adtech and Martech, especially across the ecosystem of tools that support the monetization of small merchants. Concentrate (one of us) continues as a standout. What seems to be resurgence in digital OOH activity … maybe now is its time?
Eric Franchi: Absolutely, Q3 and Q4 2020 We were the most active in three years in terms of new investments and follow-ons. This seems to mirror the shape of the 2020 commercial results of many of our portfolio companies.