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Ad tech firm Infillion has been restoring MediaMath by hiring back some employees and starting client contract negotiations now that its purchase of the bankrupt demand-side platform has closed, founder and executive chairman Rob Emrich tells Kerry.

Why it matters: MediaMath is the latest deal for Infillion, born from a combination of ad tech firms, to expand its influence in the competitive media buying industry through M&A.

What they're saying: Emrich says part of his drive to buy MediaMath was to better compete in advertising automation.

"We're super early in programmatic because I think about programmatic is just the first few innings of a longer arc of automation. And if you want to really do automation and all of the cool things that come with automation, like AI and dynamic creative optimization, you have to have your own buying platform," Emrich says.

Details: Infillion has hired back four MediaMath employees with tech expertise and is in about 10 to 20 contract negotiations with potential clients, Emrich says.

Emrich says he has long been a "secret admirer" of MediaMath. His company previously operated a demand-side platform, which he shut down in 2017 to focus on profitability. It then partnered with The Trade Desk to provide the last-mile bidding, he says.

"When we shut it down, we didn't really have enough scale to support our own DSP," Emrich says. "We're a much bigger business now, and from a scale perspective, it makes sense. We have larger aspirations, too."

Catch up quick: Infillion was previously called Gimbal | true[X]. In 2020, Gimbal acquired true[X] from Disney, which came from the 21st Century Fox deal. Gimbal specialized in location data whereas true[X] started with value exchange ads and later connected TV ads.

Last year, Infillion bought the in-store analytics company Analytiks.

The company last raised funding in 2017. Qualcomm is its second-largest shareholder, after Emrich. He declined to disclose annual revenue but says the company has been profitable for about six years.

Infillion has more than 200 workers, the majority being employees with some contractors.

By the numbers: Infillion successfully bid for MediaMath in the bankruptcy auction held Aug. 21, where Genius Sports Media was the other bidder, for $22 million.

During the bankruptcy proceedings, Emrich said his team's financial model expected $30 million in operating losses over the next three years. But Emrich tells Axios that he expects those expenses to decrease if they get "quick customer adoption."

Emrich said at the proceedings that Infillion expected to spend about $445 million on traffic acquisition costs and $102 million in other operating expenses over the next three years, which factored in hiring about 155 people.

Of note: Infillion is not looking to sell or go public but is eyeing more acquisitions once MediaMath is better integrated and built back up, Emrich says.

1 big thing: Ad tech player's second chance 

Photo illustration of Rob Emrich beside tilted lines and megaphones.

Rob Emrich. Illustration: Lindsey Bailey/Axios. Photo: Courtesy of Infillion

Private equity managers are going back to school. 

Why it's the BFD: The flow of TV dollars, mainly driven by college football, is widening the haves and have-nots across the NCAA, forcing schools to seek outside funding. 

Driving the news: Learfield, a college sports marketing and content giant, was taken over by three investment firms yesterday as part of a debt restructuring. 

Zoom in: PE has been slowly encroaching into college sports in recent months. 

In August, Florida State reportedly tapped JP Morgan to explore fundraising options, with Sixth Street Partners showing interest.

Florida State president Richard McCullough complained that the school's athletic department was $30 million behind in revenue compared to the SEC and Big Ten.

"We of course are not satisfied with our current situation," he said last month.

The big picture: Sports have become a hotbed for PE investment in recent years.

Many Premier League clubs have PE ownership, and other firms are trying to get in on TV rights for many European leagues, including Italy's Serie A and Germany's Bundesliga.

In the U.S., the NBA, NHL, MLS and MLB allow PE firms to take out minority ownership stakes — though the NFL has remained off-limits.

Over the last few years, funds like Arctos and Dyal that are solely used to buy minority ownership stakes have popped up.

RedBird Capital has a joint venture with the NFL's VC arm called EverPass, an entity created to handle commercial media rights such as NFL Sunday Ticket.

Details: The Learfield agreement will reduce its debt by more than $600 million while adding $150 million in new investment and helping the company avoid bankruptcy. The three firms — Clearlake, Charlesbank and Fortress —  were Learfield's top lenders.

As part of the deal, Endeavor and its PE partner Silverlake will become minority partners.

Learfield functions as a middleman for many schools, handling multimedia rights that include merchandise sales, stadium sponsorships, ticketing and content development.

Some of Learfield's top clients include the University of Texas and Alabama.

Private equity moves on college sports with Learfield takeover

2. The BFD: 🏈 Private equity enrollment 

Illustration of a college basketball player with a dollar sign on his jersey.

Looking for more deal insights? Search the Axios Pro Deals Tracker beta.

• Apollo Global Management is among those circling the global gaming unit of International Game Technology (NYSE: IGT), which could fetch between $4b and $5b (including debt), per Bloomberg. https://axios.link/3PBL0Zk

• AMC Entertainment (NYSE: AMC) raised $325.5m through the sale of 40 million shares, weeks after a Delaware judge approved its APE stock conversion plan. https://axios.link/3rmC28K

• Strada, an AI startup that builds tools for Hollywood production and post-production, raised $1.9m in pre-seed funding. https://axios.link/450ofCU

3. Deal flow

• Barny Mills will join Sky as CEO of Sky Deutschland, replacing Devesh Raj who will become COO of Sky UK. https://axios.link/3LiL4dF

• Machelle Henks was named EVP of strategy and Shannon Moylan was named SVP of public relations at Imre. https://axios.link/3LmD5fS

• Sezin Cavusoglu was promoted to SVP, unscripted current production at NBCUniversal. https://axios.link/45Qe05g

• Brian Nemitz named VP and news director of CBS News and Stations' local businesses in Minneapolis-St. Paul, including WCCO-TV. https://axios.link/45OQJkc

• X (formerly Twitter) hired four ad sales and content executives: Monique Pintarelli joins as the head of the americas, overseeing sales and partnerships across the U.S., Canada and Latin America; Carrie Stimmel joins as global agency leader; Brett Weitz as head of content, talent and brand sales; and Rob Hayes as lead for revenue operations. https://axios.link/3EC5Oti

4. Movin' on up (or out)

💰 Star-powered Stoner Cats web series settles with SEC (Axios)

"While the company behind the show, Stoner Cats 2, LLC, did not admit wrongdoing, it's a notable loss for the notion of so-called utility NFTs, tokens that provide access to some content or service," Brady Dale writes.

💀 Disney-Charter feud portends carnage in cable TV. "The market's been warned." (WSJ)

"Allowing cable-TV channels to disappear from the bundle is risky. They supply the profits for Disney and its peers to invest in streaming services that are growing but losing lots of money. Sacrificing channels is a trade-off that all media companies will need to consider, as they make the tricky pivot from TV to streaming, media executives and analysts said," Robbie Whelan and Isabella Simonetti write.

✊ Marquee writers push for negotiations, but their clout may not matter (NYT)

"Whether marquee writers have enough juice to help end the dispute — as they did during the 2007-8 screenwriters' strike — is an open question, however. The power dynamic has changed inside the union since then, longtime Hollywood observers say, and showrunners no longer hold the same sway," John Koblin, Nicole Sperling and Brooks Barnes write.

5. Channel surfing

Illustration of a TV color test screen in the shape of a wave.

📺 Situational awareness: Nielsen named longtime product executive Karthik Rao as CEO with David Kenny becoming executive chairman amid broader controversies plaguing the leader in TV ratings, Sara Fischer and Kerry write.

@tim_bays: "Elemental" on Disney+. I'm a sucker for Pixar and glad this movie eventually found legs at the box office. 

@kerrymflynn: Run the Jewels at Terminal 5. Seeing my favorite rap duo perform "RTJ2" on the second day of their four-night stop in NYC.

✏️ Thanks to Michael Flaherty for editing and Katie Lewis for copy editing this newsletter.

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September 14, 2023

1 big thing: Ad tech player's second chance