Adtech company IgnitionOne lays off staff while facing an allegation of unpaid bills
Category : entrepreneur
- New York-based adtech firm IgnitionOne laid off staff on Wednesday and faces allegations of unpaid bills.
- IgnitionOne recently spun off its demand-side platform to martech firm Zeta Global to focus on its data and tech business.
- Progress Partners, an investment firm IgnitionOne hired to advise it on the deal, alleges that IgnitionOne owes the firm more than $590,000 in damages.
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IgnitionOne, which builds and sells programmatic advertising technology, laid off a handful of employees on Wednesday, sources close to the company said.
The cuts, estimated to number fewer than 10, came two months after martech firm Zeta Global acquired IgnitionOne’s demand-side platform that coordinates marketers’ programmatic ad buys. Some of IgnitionOne’s accounts from small to mid-size brands and fewer than 15 people from IgnitionOne joined Zeta Global as part of the deal, a Zeta Global spokesperson said.
IgnitionOne confirmed that the layoffs affected fewer than 10 employees.
IgnitionOne faces a breach of contract complaint from its former investment firm
IgnitionOne also faces a civil complaint alleging breach of contract from Progress Partners, an investment firm it hired to advise it on a potential sale. A complaint filed in October in Massachusetts District Court alleges that IgnitionOne owes Progress Partners more than $590,000 in damages plus attorney’s fees, interest and other costs, related to its work that led to the deal with Zeta Global in September.
It’s unclear if there is a connection between the complaint and the layoffs.
Adtech consolidation continues
Fifteen-year-old IgnitionOne is one of the oldest adtech firms and works with brands like Mazda and Motel 6, according to its website. The company sold marketers the DSP as well as a tech and data service that claims to help companies do things like personalize ads to people based on their search history.
IgnitionOne was acquired by holding company Dentsu Aegis in 2010 and spun out as a standalone company in 2013. The company has raised $85.2 million and has about 250 employees, according to LinkedIn.
Adtech companies struggle to pivot into new businesses, particularly DSP companies that specialize in media buying.
Big firms like The Trade Desk and Google continue to make inroads with large advertisers while holding companies cut back on the number of adtech companies that they work with.
As a result, smaller DSPs like IgnitionOne, OwnerIQ and Dataxu have become acquisition targets. Roku recently acquired Dataxu for $150 million, and OwnerIQ was acquired by tech and data services company Inmar.