Cantor Fitzgerald’s Youssef Squali on Ad Technology and 2016 Trends

Editor39s Note This is the second installment of a threepart series Go here to read what BMO Capital Markets39 Dan Salmon has to say about ad technology and 2016 trendsYOUR NAME Youssef SqualiYOUR COMPANYamp160 Cantor FitzgeraldYOUR TITLE Managing DirectorSEARS What do you read to keep up with politics art and cultureSQUALI Anything that could helpSEARS What do you read to keep up with friendsSQUALI Email Facebook WhatsAppSEARS What do you read to keep up with the advertising technology industrySQUALI Very varied Mostly companiesamp8217 and general blogs including Google FB AOL RUBI MediaPost Business Insider and IABSEARS With regards to advertising automation what are the three biggest trends you expect to impact companies in 2016SQUALI amp160Programmatic taking over premium inventory onlineTV ad buying going programmaticImproved measurementgreater transparency in ad effectiveness to minimize fraudwasteSEARS With regards to advertising automation what are the three most overblown topics that you wish would just go away SQUALIThat it devalues ad inventory or applies only to remnant inventoryShouldnamp8217t be used for publishersamp8217 most premium ad inventorySEARS Tell us your coverage universeSQUALIamp160SEARS The majority of ad technology companies has not performed well in the public markets Of the poor performers what are the commonalities between them that have contributed to this weaknessSQUALI amp160Disappointing quarterly performance postIPO out of several of them so the whole group with a few exceptions is in the penalty boxThis is a convoluted segment of the industry which remains difficult to understand for most on Wall StreetThe belief that the largest online advertising providers Google and Facebook with extensive adtech stack will ultimately dominateSEARS A smaller handful of ad technology companies has performed better than the rest What are the commonalities between them that have contributed to this relative strength SQUALIThey delivered what they said they were going to deliver and performed to or better than expectations since IPOBeing perceived as very focused on a particular niche or functionality of this segment and doing it wellBeing ultimately an acquisition target if they continue to outperformSEARS Do we live in a amp8220tale of two citiesamp8221 where Google and Facebook win almost everything advertisers are dictated to and other media companies fight for the scrapsSQUALI That is still generally the belief among investors and analysts The acquisition of AOL by Verizon at 8x EBITDA speaks positively for those that are perceived to have scale and a brand like AOL within adtech The acquisition of Millennium Media for 250M well below its IPO valuation speaks to the oppositeSEARS Please answer the following statements yes or noSQUALIamp160SEARS If you could go to the airport right now with friends or family and fly anywhere in the world for vacation who would you take and where would you go SQUALI Safari in East Africa with familySEARS If you could create an endowment to fund any existing nonprofit you designated what lucky nonprofit organization would that be SQUALI Medecins sans FrontiereSEARS What is your favorite restaurant in the world SQUALI La Tour damp8217Argent in ParisSEARS Thanks YoussefThe opinions and points of view expressed in this commentary are exclusively the views of the author and do not necessarily represent the views of MediaVillageMyersBizNet management or associated bloggers

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Cantor Fitzgerald’s Youssef Squali on Ad Technology and 2016 Trends

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