Advertisers should be careful investing in ad tech companies due to their potential for bankruptcy.
With the growing numbers of publishers and advertisers, the ad tech industry is finding it increasingly difficult to balance supply and demand. The collapse of Sizmek, one of the biggest demand-side programmatic ad platforms, has the industry worried about the uncertainty among supply chain firms.
Supply-side platforms (SSPs) should be careful while giving out credit to demand-side platforms (DSPs) as they could default on their debts and leave the publishers out of millions of dollars. This article contends that this could lead to legal ramifications between agencies and their DSPs, SSPs and publishers.
The piece suggests that many ad tech companies declare insolvency overnight, pointing to a larger problem of transparency. Marketers should be aware of ad tech firms they want to invest in, as many firms are unclear about debts and credits they are holding from DSPs and SSPs.
[3 minute read]