Blog 15

Times have drastically changed since corporations’ main advertisement strategy revolved around print, radio, and television.

Today, the internet is increasingly playing a larger role in the global economy. Eighteen percent of global business is conducted on the internet; in the U.S. this number is inflated to 30%. Seven out of ten Americans are active online shoppers; a majority figure that accounted for over $870 billion in sales and 14% of all U.S. shopping last year.

These intriguing figures are fueled by advances in marketing technology, which encompasses a range of software services and tools that assist in meeting marketing objectives and goals. Marketing Technology, or MarTech relies on a broad range of solutions, including automation, computer learning, artificial intelligence, telecommunications, and other applied sciences.

When consumers are online, they’re surrounded by advertisements. No longer chosen by corporations, these ads are actually chosen by consumers themselves, as businesses pay billions for consumer data, delivering tailored ads 24 hours a day. Consumers also receive virtual ads through their email inboxes, text messages, and push notifications. The advancement of marketing at the hands of MarTech is truly limitless.

Marketing Technology’s mission is in part to create a longstanding relation with consumers’ commerce experience. Aspects of MarTech include content marketing, search engine optimization and marketing, social media marketing, affiliate and influencer marketing, email marketing, and more.

The explosion of MarTech has captivated Silicon Valley as venture capital firms have flocked to back the sector’s hottest startups.

As of 2021, the most active VC firm in the MarTech sector are as follows, according to Paperstreet:

• 500 Startups: 80 investments
• Techstars: 65 investments
• Battery Ventures: 63 investments
• First Round Capital: 58 investments
• Accel: 57 investments
• Sequoia Capital: 55 investments
• SV Angel: 53 investments
• YCombinator: 52 investments

VC’s have poured billions in MarTech startups this year. According to PitchBook, the top 10 VC deals in the sector this year include:

• $325 million investment in iSpot.tv, a developer of a real-time advertising intelligence platform, led by Goldman Sachs Asset Management
• $316 million investment in Onefootball, a developer of a football media platform, led by Liberty City Venture
• $300 million investment in Branch, a developer of user interaction technology, led by New Enterprise Associates
• $300 million investment in SpotOn, a Developer of a cloud-based financial platform for business growth, led by Dragoneer Investment Group
• $248 million investment in Highspot, a Developer of a sales engagement platform focused on content optimization, led by B Capital Group and D1 Capital Partners.
• $200 million investment in 6Sense, a developer of a predictive intelligence platform, led by Blue Owl Capital and MSD Private Capital
• $200 million investment in CommerceIQ, an operator of a retail e-commerce management platform, led by SoftBank Investment Advisers
• $200 million investment in Sensors Data, a provider of an in-depth user behavior analysis platform and professional consulting services, led by The Carlyle Group and Tiger Global Management
• $200 million investment in Zaihui, a provider of SaaS-based business communication and customer relationship management software, led by SoftBank Investment Advisers and B Capital Group
• $200 million in GlobalWebIndex, a developer of market research and analytics platform, led by Permira.

As with nearly every sector this year, total deal count and value is down in the MarTech sector when compared to last year, as VCs have been more frugal in deploying capital and rising interest rates, persistent inflation, and other macroeconomic headwinds have burdened the global economy.

This year, there have been a recorded 1,173 transactions by VC firms in the MarTech space, carrying a total fundraising figure of $12.2 billion, compared to 2021’s 1,762 deals which amassed a fundraising total of $19.2 billion, according to PitchBook.

Regardless, MarTech is increasingly carving out a significant portion of VC portfolio holdings. MarTech’s relatively new technology is still evolving, allowing for the sector to also serve as a diverse holding for many institutional investors.

Linqto members can join the likes of VC firms by diversifying their portfolios with MarTech.

Bloomreach, a formative API company devoted to helping ecommerce customers create, personalize, and scale commerce experiences. Bloomreach’s flagship product, brX, is a digital experience platform built specifically for brands, retailers, and B2B companies to grow their revenue online and customers a personalized commerce experience. 

Bloomreach has an expansion reach in the MarTech space, powering over 25% of all-ecommerce experiences across the U.S. and U.K., supporting over 300 global enterprises.

In February, Bloomreach closed a $175 million round, led by Goldman Sachs Asset Management, with participation from Bain Capital Ventures and Sixth Street Partners. The round landed Bloomreach a $2.2 billion valuation.

MarTech has proven itself to be a rising star for institutional investors. Its technology is progressing, driven by in part by advancements in software and AI technologies; and with billions flowing into the sector each year, MarTech startups have shown no signs of slowing down.