Managing Partner @ Bondo Advisors | M&A, Corporate Finance in the Tech Vertical. I sell your company!
🥇The Trade Desk and AppLovin are the big-time, fast-growing leaders in the #AdTech space. Way above all the rest. 🏆The Trade Desk's impressive growth: 🔸Revenue skyrocketed from 💲44 million (and $1M EBITDA) in 2014 to 💲1946 million (with $321M EBITDA) in 2023 😱 🔸Revenue grew by 23% in 2023 compared to 2022. 🔸The stock trades at a staggering EV/EBITDA (TTM) multiple of 141✖️. 🔸The company's market cap matches the sum of the other top 19 in the list ($46B). 🔸The market cap exceeds the combined total market cap of the leading holding groups: Publicis ($28B) and Omnicom ($17B). 🎖️AppLovin's Remarkable Rise: 🔹Revenue surged from 💲483 million (with $247M EBITDA) in 2018 to 💲3,283 million (with $1,138M EBITDA) in 2023. 🔹Revenue increased by 17% in 2023 compared to 2022. 🥷What is truely impressive is AppLovin's $1.4 billion TTM EBITDA, over 4✖️the TTM EBITDA The Trade Desk is able to generate. 🔹AppLovin's EBITDA is 30% more than the next 19 players combined ($1,077 million). 🔹ThAppLoving is trading at 22X EV/EBITDA (TTM), that is 1/6th the multiple The Trade Desk is trading at currently. 🤔 Why the huge difference in EBITDA trading multiples❓ 💥My feeling is that The Trade Desk trades at higher multiples mainly for two reasons: it's faster growth and being perceived as a SaaS business, while AppLovin is viewed as a media business. 🏓Also I believe the market feels some discomfort with AppLovin's highly fluctuating gross margin: 70% (2023), 55% (2022), 65% (2021), 61% (2020), 75% (2019), 88% (2018). 💡 Comparative Insights: |🔸Google's #AdNetwork business, essentially an adtech competitor, was a $31 billion revenue giant in 2023, dwarfing everyone else in this adtech list. 🔸Criteo, the 3rd player in revenue, decreased sales by 3% in 2023 and barely doubled revenue from 2014 to 2023 (from $988M to $1,950M), when The Trade Desk grew 44X in the same period. 🔸Taboola (4th in revenue) grew by a mere 3% in 2023, and Outbrain (5th) decreased by 6%. Both are #nativead networks, a model that seems to be suffering. 📈 Notable Growth in viewability and #brandsafety players in 2023: 🔸DoubleVerify grew revenue a strong 26%. 🔸Integral Ad Science grew a super heathly 17%. 📉 Stagnation and Decline in #performance #marketing players. ⛔Fluent, Inc's revenue has remained stagnant over 5 years (from $281M in 2019 to $298M in 2023). ❌LiveRamp’s revenue decreased from $805M in 2015 to $660M in 2023 📊 Some Gross Margin Insights: 🔸Nexxen and DoubleVerify lead with 82% gross margin. 🔸Followed by Integral Ad Science (78%) and Innovid (76%). 🔸On the low end: MediaAlpha (18%), Outbrain (20%), Fluent (27%), and Taboola (29%) 🚀 The Trade Desk and AppLovin have established a commanding lead over their competitors, yet they still trail significantly behind Google's AdTech giant. 🔍 Do you think they will manage to start closing this gap? 💬 Can any other players rise to challenge The Trade Desk and AppLovin's dominance?
Lawrence Taylor
1mo
Can somebody explain TTD market cap at a 145 multiple?
Casey White
1mo
Thanks for sharing Joshua Novick!
ComClaims
1mo
The market cap of The Trade Desk exceeds the combined total market cap of the leading holding groups: #Publicis ($28B) and #Omnicom ($17B). Could be of your interest: Xavier Garrido Mikel Lekaroz Pepe Cerezo Salvatore Cospito Javier Sánchez Campayo François-Xavier Le Ray Matthieu Réol Pauline Conjard Xavier Jaunet Josiane INAMO Lavinia Benon-Stanescu Barthélemy Dupuy Mykim Chikli Daniel Pastor Arranz Jorge Herrero Mardomingo Ignacio Tome Vilanova Telmo De La Cruz Acevedo Lourdes Campos Morales Lukas Fassbender Daniel Neuhaus Sven Hagemeier Jan Tornquist Tessa C. Blindenbacher Marc Böttinger Ferdinand Schmitt-Besenthal Maximilian Strotjohann Luisa Wecke Danilo Berg Sebastian Priess Jonathan Hauffe
Thanks for sharing
Our partner Joshua Novick looks at the Adtech space and the leadership position of two very different players The Trade Desk and AppLovin the big-time, fast-growing leaders in the #AdTech space. Could be of your interest: Tacho Orero Purnomo Kristanto Jed Dederick Natalia López Papiol Nacho Igual Somoza Jeff Green Sandra García Jiménez Daniel Martínez-Ligero Sánchez-Roselly Irene Bonache Sánchez Sandro Catanzaro Lukas Fassbender Anthony Grandjean Angela Bersini Marcus Harper Andrea Frankl Sanz Dan Ackerman Brian Kilmer Kendra Manzo Ian Colley Adam Foroughi Simon Baptist Brandon McCray（马飞龙） Joyce (Ting) Ye Mariano D. Fabio Zoboli