Advertising technology startup InMobi announced their acquisition of AerServ, a Los Angeles-based startup, for $90 million in a cash and stock transaction marking the deal as InMobi’s biggest acquisition so far. In addition to gaining new clients, the move is expected to help the Indian startup increase monetisation by 25-30% from its existing set of clients.
InMobi and AerServ begain discussions about six months ago and the acquisition expands InMobi’s presence in the world’s biggest market for advertising – the USA. The Bangalore-based startup is also planning to launch its platform in China and India.
Speaking on the acquisition, InMobi founder and chief executive officer (CEO) Naveen Tewari says, “As advertisers think about moving to more video-based advertising and wanting to do so programmatically, there is no such solution that existed in India and in China. Till now, it was largely a US phenomena. Both of these trends of video being the next big thing in advertising and programmatic being the next big trend in advertising were something that India and China were yet to essentially capture.”
Automating the process of buying digital advertising through the use of technology and software is what is referred to as ‘programmatic advertising’.
According to a report, 65-70 employees and executives from AerServ wil be absorbed by InMobi and the video and programmatic business will contribute about 35% to the company’s overall revenues.
According to Tewari, AerServ’s technology was growing rapidly in their respective space and InMobi adds scale to that. It provides more customers, advertisers, pulishers, etc. on a global reach.
In 2012 and 2013, InMobi had started a hiring spree which had negative consequences and some of their products, like Miip, were unsuccessful. They were also charged by FTC for illegally locating consumers to sell geo-targeted advertising.
They have made four acquisitions so far which ranged between $5-20 million, making AerServ InMobi’s biggest acquisition.