Hilco Global (“Hilco”) is delighted to offer the opportunity to acquire the intellectual property (“IP”) assets behind a prominent set of global digital advertising and payment businesses (“the Group”). We are currently marketing the assets to prospective interested parties and seeking expressions of interest and offers. Bids are invited for all assets or for assets related to certain parts of the Group.

Background   
The Group operates a global mobile advertising and monetisation network. Founded in 2006, the Group has achieved a worldwide reach, strong market position, valuable targeting capabilities and a well-established client base. It has invested in significant technological developments that enhance the proposition versus its direct competition which include advanced fraud, tracking and big data reporting capabilities.

Specialising in direct response advertising, the Group aggregates a global network of advertisers and publishers who use its platform to trade advertising spend for targeted mobile inventory. Advertisers span a number of sectors and the Group has particular strength in the under-served market segment of direct response advertising for the lucrative male and mainstream demographic audience.

The Group has developed a vertically integrated mobile monetisation platform combining a performance ad network, an affiliate network and a payments platform. The Group successfully converts mobile audiences into leads and transactions for advertisers and M-merchants (mobile sites and apps), and generates advertising and affiliates revenues for publishers and app developers. Beyond its ability to match mobile inventory with the highest paying advertisers, the Group is technically and commercially able to ring-fence and direct mobile traffic to the highest converting affiliate programmes and mobile payments flows, increasing ROI and monetisation across the conversion path. The vertically integrated offering creates significant value for marketers and mobile operators by providing an uplift in conversion and an optimised flow from buying an audience to billing a transaction. The integrated offering generates enhanced data feedback which, in turn, increases the ability of the Group’s proprietary algorithm to generate high yielding conversion rates. 

Due to its long experience and history in the mobile sector (predating the iPhone), the businesses’ technical capabilities have evolved to also include modules that identify, detect and remove fraudulent traffic systematically as well as provide full digital tracking capabilities and scale beyond the mobile ecosystem to include desktop, Facebook and Google driven traffic.

With international operations and a global sales force, the Group has achieved significant scale and growth.  The Group trades an advertising business including affiliate distribution network and a standalone but commercially integrated Mobile Payments Network.

Mobile Advertising Network - Overview
The Group’s mobile advertising business operates a technology platform matching an established global network of advertisers and publishers to generate advertising spend. It uses technical targeting to maximise the ROI for advertisers and the monetisation of inventory for publishers - focusing on optimising the highest paying ad for publishers with the highest ROI for advertisers. It automatically aggregates ad inventory supply from mobile publishers and matches it with advertiser demand.

The Group’s “Mobile Advertising as a Service” platform provides an ad market place, ad-serving and real time programmatic bidding capabilities. The business provides both self-service and managed account services to run ad campaigns, using its proprietary programmatic ad server algorithm and conversion optimisation techniques. Advertisers agree targets for conversion levels and the business delivers consistent and measurable profit for advertisers.

The business achieves market leading conversions by leveraging proprietary technology which uses real-time conversion tracking, technical targeting data collected over multiple years, and ad-selection based on advanced statistical modelling. The Group has accumulated extensive data history of mobile traffic behaviour in different markets which provides a robust analytics base. Its algorithms further optimise technical and financial performance.

Thousands of unique advertisers and publishers use the network across c. 200 countries. The Group delivers over 30 billion impressions per month, reaching mobile users worldwide. The technology base sits in two datacentres and can serve over 200k events per second.

The network is integrated with the affiliate network and able to join direct traffic with advertisers and merchants allowing the optimum service to any inbound sales request (CPA, CPI, CPL, CPM and CPC).

Mobile Commerce Affiliate Distribution Network - The Group’s direct response affiliates and referral network provides lead generation to mobile merchant websites through a network of partners and affiliates. The affiliate network uses market knowledge and conversion data from the mobile advertising network to produce additional margin on traffic required by ad affiliates. This business line launched in late 2017 and has already achieved $1m+ run rate, and extends beyond mobile into desktop and in app traffic from any demographic.
The Mobile Advertising Network and integrated Affiliate Distribution Network have enhanced fraud , tracking and business intelligence software built in that works real time to detect, prevent monitor transactions and aggregate into meaningful BI real time, with enhanced reporting/analysis tools also available for querying.

In Q1 2018 the mobile advertising and affiliate distribution network business had a $4k USD gross profit / day run rate.

Mobile Payments Platform - Overview
The Group’s direct response mobile payments platform provides mobile merchants with regulation ready transactional services that enable consumers to pay through their telephone/operator bill. The Group’s technology engine can process thousands of transactions per minute. It has been integrated directly with 11 mobile operators across 10 countries in Europe and Asia and has a solid pipeline of connections in process.  This business launched in 2014 and is already EBITDA positive with turnover of $4m last year.

In Q1 2018 the mobile payments network business had a $2k USD gross profit / day run rate.

Group Financial Overview ($ USD)

FY17 Total Revenue: $30m, Gross Profit: $7.3m
FY16 Total Revenue: $47.9m, Gross Profit: $9.4m
FY15 Total Revenue: $59.2m, Gross Profit: $17.2m
FY14 Total Revenue: $49.4m, Gross Profit: $12.5
FY13 Total Revenue: $32.3m, Gross Profit: $9.2m

Technology Overview

Mobile Advertising Network - System and Software Architecture

The existing system is physically collocated in two datacentres across the globe to reduce network latency to clients.

The core of the software architecture is the Ad Delivery Engine; this software is responsible for processing each request for advertisement, and select the relevant ad position.

The main repository of information is the Data Storage Engine, this is an in-house developed software analytics database able to store and aggregate incremental information in real time and efficiently handle large volumes of information generated by the network. The architecture and its deployment provides a low-latency, highly scalable, highly-available distributed service to enable optimised ad delivery in the shortest possible timeframes with an extremely competitive cost base.

In order to interact with the data, the Company has created two web interfaces, one for clients that offers full inventory management and statistics. The second interface is used by the Company’s back-office staff, providing extended access to inventory and full account management.

The Company has also developed a Business Intelligence (BI) tool from the ground up. Given the amount of data generated by the system and the need to access the data in a flexible way, this tool allows the users to generate custom reports from a simple web interface.

Mobile Payments Platform - System and Software Architecture
The existing infrastructure is physically located in two datacentres. One in India, managing all connections to South East Asia mobile carriers and another datacentre in London, managing European carriers and hosting the main systems.

The core of the software architecture is our Billing Engine. This proprietary software is responsible for handling the mobile transactions and the communication with the mobile carriers during the payment flow.

The Company has also created a web-interface that allows clients and members of staff to manage their accounts and access the statistics in real-time.


Intellectual Property Assets Overview


Mobile Advertising Network Technology Platform

• A proprietary programmatic technology platform that provides fast and reliable ad delivery at scale and maximises total conversions.
• The platform provides a low-latency, highly-available distributed service to enable optimised ad delivery in the shortest possible timeframes.
• The programmatic trading platform operates on a number of protocol platforms to trade in conjunction with one another.
• The platform is fully RTB compliant for DSP and SSP partners and other ad networks can technically integrate with the system.
• The platform supports a range of formats including: Desktop, Feature phone, Smartphone, Tables, In-App, Notifications, Icons and Text Banners.
• Core software applications are comprised of: i) a core Ad Delivery Engine java application ii) Data Storage - an in-house developed analytics database which processes and stores information generated by ad delivery nodes in near real-time and exposes the data via an API to the user interfaces ii) a Website Quality Daemon system to control and verify the quality of the traffic, based on statistical analysis iii) a Campaign Compliance Daemon system to control the quality of landing pages iv) a Counter Service v) an Alert Service vi) Ad Exchange - RTB compliant exchange implementation.

Advanced Statistical Ad-serving Algorithm

• The Group’s real-time Bayesian algorithm, developed in house, drives a system that selects ads, maximising total conversions. The algorithm adapts in real-time and progressively learns, leveraging the Group’s rich database of conversion history.
• This proprietary performance based algorithm is able to determine the highest paying ads and highest conversion inventory for any ad served on the network across a number of variables including: type of publisher, device manufacturer, network (carrier versus wi-fi), operating system, demographic, creative ID, ad format, day-parting targeting, conversions timestamps, location data, and content.
• Continuous research and development of the algorithm has been carried out in partnership with the Department of Statistics, UCL.

Rich Proprietary Conversion Database

• Operations are driven by proprietary conversion data, used as shared KPIs between the technology and sales teams, publishers and advertisers.
• This large in-depth technical targeting and advertiser/publisher conversion database has been built over a number of years. The data provides a key competitive advantage for the direct response platform, allowing precise inventory valuation, ROI optimisation and KPI tracking.
• Proprietary software is used to log and report statistics in real-time. Internal/external user interfaces automatically produce relevant graphs, country heat maps and real-time conversion data.

Other Corporate Organisational Knowledge

• Including customer and supplier lists.

Goodwill in Leading Digital Advertising and Payment Brands

• Global brand, operating in the industry for over 10 years with an established, longstanding client base.
• Recognised by Sunday Times Tech Track 100 League Table, HSBC International Track 200 and the Deloitte Fast 500 in 2015.

Domain Names 

• Portfolio of branded domain names.

Copyright in Website Content

• Attractive and informative website.

Diligence & Sales Process
Hilco is currently soliciting interest in the assets from qualified buyers.
Bid Deadline: 18 April 2018 at 2pm BST. Bid documentation will be provided on request. 

Should you, or your client wish to register an interest please contact Nat Baldwin or Linda Shannon at Hilco.
Access to a data room is available on request.
Email: NBaldwin@hilcoglobal.eu and LShannon@hilcoglobal.eu
Phone: +44 (0) 141 406 3197