Inside Infillion’s 4-year plan to revive fallen adtech pioneer MediaMath back to a $100 million business

• Infillion last week closed its $22 million deal to buy adtech company MediaMath out of bankruptcy.
• MediaMath, a pioneer adtech players once valued at $1 billion-plus, filed for bankruptcy in June.
• Infillion wants to hire back former staffers, win back clients, and offer a “walled garden as a service.”

On Friday, adtech platform Infillion completed a $22 million deal to buy out the bankruptcy of MediaMath.

That was the least difficult part. Now, Infillion CEO Rob Emrich must follow through on a business plan to return MediaMath to $100 million in net revenue within four years. Infillion intends to integrate MediaMath with its other adtech assets and provide a new, tailored solution to assist large retailers, ecommerce platforms, healthcare providers, and other businesses in growing their own advertising businesses.

Emrich has described the new offering as a “walled garden as a service,” in which other companies could build ad-buying platforms to service advertisers using MediaMath’s technology.

“Walled garden” is an adtech term that refers to a situation in which a publisher, such as Facebook or YouTube, controls all aspects of ad buying on their sites and apps. As the trend toward data privacy accelerates, Emrich believes that this type of offering will assist advertiser clients in using their customer data in more closed and trusted environments.

Emrich intends to revitalize MediaMath’s traditional demand-side platform business as well. DSPs are software tools that assist advertisers in automating and optimizing ad buying across the web, apps, and other media. The MediaMath platform will be relaunched in early 2024.

Macy’s, Staples, Sanofi, and T-Mobile were among the companies that used MediaMath.

The major challenge that lies ahead

Resurrecting MediaMath will be a significant undertaking. The company, which was once worth more than $1 billion, went bankrupt, owing more than $125 million to creditors, some of whom may be wary of working with MediaMath again. Its closure resulted in the loss of hundreds of jobs, and many of those employees have since found new jobs. Some former MediaMath employees are still owed thousands of dollars in unpaid salaries and expenses. Many former clients will have been forced to switch to competitors, such as the publicly traded adtech company The Trade Desk and Google, after the company shut down operations at the end of June.

Read on for the backstory: MediaMath appeared to be destined for a $1 billion fairy-tale exit. Instead, the majority of early investors received nothing.

Despite its recent financial difficulties, Emrich believes there is still a lot of goodwill in the market for the MediaMath brand and its legacy as the first demand-side platform.

“With a good leader, particularly a good CRO, and a sales team that is trained on the same message, they can revive the brand,” said Tom Triscari, CEO of technology research firm Leomade Projects.

Reestablishing trust

Infillion chose to bury $84 million in clawback claims it could have made to vendors for money MediaMath had sent to them shortly before it went bankrupt as part of the bankruptcy sale.

“It allowed us to start on a really, really good foot with all of the ecosystem partners,” Emrich explained.

Infillion is not liable for the $125 million in liabilities that MediaMath owed to supply-side platforms, data vendors, publishers, and other suppliers during the Chapter 11 process.

Since the deal closed, Infillion has hired four former MediaMath employees, mostly on the tech and product side, according to Emirch. He refused to identify them. Emrich did confirm that some former employees were hesitant to return because they had been burned by the bankruptcy.

Former MediaMather cofounder and former CEO Joe Zawadzki, who was ousted by the company’s board in 2021, is also involved behind the scenes. Zawadzki and his adtech-focused venture capital firm Aperiam Ventures are advising Infillion on how to get MediaMath back on track.

“Aperiam — and particularly Joe — they’re incredibly connected,” Emrich said.

Insider previously reported that Aperiam was hoping to raise funds through an investor syndicate to buy back the MediaMath assets itself. When the bid to enter the auction exceeded what the syndicate had hoped for, Aperiam began advising Infillion on the bidding process. Emrich confirmed that Zawadzki had been in discussions about a possible seat on the Infillion board, but that there were no plans for that to happen at this time.

Aperiam Ventures general partner Eric Franchi said the firm was pleased MediaMath had chosen Infillion because of its commitment to rehire former employees, maintain the brand, and restore client and partner activity — including some Aperiam portfolio companies that were previously active on the platform.

Better prospects

According to some former insiders and adtech experts, MediaMath was slow to capitalize on newer advertising trends such as connected TV. Emrich believes that Infillion’s other assets, such as TrueX, the connected-TV ad platform acquired from Disney, can help MediaMath.

Emrich previously told Insider that Infillion expects to lose $30 million on MediaMath over the next three years. This will include an investment of $40 million in working capital and $102 million in other operating expenses as it restores the platform and hopes to have 155 people back by the end of the third year.

Emrich does not believe he will raise funds to support the effort. He claims that MediaMath 1.0 was generating $100 million in net revenue in 2022 before succumbing to its debt burden and resulting cashflow issues, whereas Infillion is debt-free and has a strong financial partner and balance sheet.

“The reality of determining how much money we lose standing this thing up is how quickly we get customers back on,” Emrich explained.