WPP media arm GroupM has acquired programmatic technology company The Exchange Lab for an undisclosed sum. The company, which provides a unique “meta-demand-side platform” for programmatic trading, will be brought under the aegis of GroupM’s real-time media management and technology arm, GroupM Connect (GMC).
“The Exchange Lab’s value proposition for an all-in-one solution across all digital media and devices and their commitment to building the absolute best technology to solve complexity for clients aligns precisely with the goals of Connect,” said Rudiger Wanck, CEO, Connect, GroupM Global, in a release.
As part of the acquisition, The Exchange Lab’s Canadian co-founder James Aitken will step down as CEO, in order to pursue other investment interests. Executive chairman Chris Dobson will take over his role within the new subsidiary, and co-founder Tim Webster will remain on in his existing role as chief strategy officer.
“We chose GroupM for the opportunity to join the world’s leading media investment group who is also the industry’s thought leader on digital advertising and the digitization of traditional media,” said Dobson in a statement. “This will propel The Exchange Lab to new heights, and GroupM’s culture will allow us to continue marketplace innovation driven by our entrepreneurial spirit.”
The Exchange Lab employs 130 people in London, Toronto, New York, Singapore and Chicago. Its key offering is its Proteus platform, which unifies programmatic trading across a large number of top DSPs. With Proteus, buyers can run simultaneous campaigns across up to 10 DSPs, including Google DBM, Turn, The Trade Desk and AppNexus. Proteus coordinates the campaign across all of the platforms so that traders can ensure maximum visibility in the marketplace, consistent reporting and access to the widest range of platform data and features.
Aitken, who comes from a background in finance, has described the platform as a Darwinian arena, where the best optimization algorithms, segmentation tactics and datasets compete their way to the top, ensuring maximum price efficiency for clients.
According to a WPP release, The Exchange Lab currently serves 700 clients globally. It had 2014 annual revenue of £21.4 million (CAD$44.3 million) and assets of £11.5 million (CAD$23.8 million) at the time of acquisition.
The Exchange Lab will join GroupM Connect alongside Catalyst, Quisma, H1, Blazar, Outrider and Keyade. GroupM reorganized and renamed the GMC group earlier this year, stating at the time that it was building a central data and technology platform that would support its media agencies in real-time media execution, including search, social and programmatic. The group currently employs 2,000 experts in 50 countries. (Xaxis, GroupM’s central programmatic agency, remains separate from GMC, but with access to its tools and expertise.)
“The impetus behind the creation of Connect is to provide agnostic real time media investment management across all technologies, data and inventory,” said Wanck. “Adding The Exchange Lab’s talent and proprietary technology accelerates our development and directly benefits the clients of GroupM’s agencies. Likewise, GroupM’s unparalleled scale and innovative media partnerships will terrifically enhance The Exchange Lab’s client services.”
According to corporate financial advisor Results International, WPP has been the most acquisitive company in the marketing and advertising technology space this year, having acquired nine tech companies in the first three quarters of 2015. WPP has set an ambitious target of earning 40-45% of its revenue from digital within the next five years. Its digital revenues in 2014 were US$6.9 billion (CAD$9.6 billion), representing 36% of its total revenue.
