Wells Davis

Last week saw 2 BIG influencer mktg M&A deals. Publicis Groupe bought Influential, and Stagwell bought LEADERS. Today I write about the Influential deal. I est the forward revenue multiple at around 2.5x. Let's break it down... ---SELLER: Influential--- • IM platform for marketers and influencers • Founded 2013 by Ryan Detert, Piotr Tomasik 🌊, Daniel Steele • 300 employees • 3.5M influencer network • Access to 90% of influencers w/ 1M+ followers • AI-powered platform w/ 100B+ datapoints  • 300+ brand clients incl Disney, Hilton, Hulu, McDonalds ---FINANCIALS & CAP TABLE: Influential--- • $150M revenue in 2023 • 50% YoY revenue growth • $51.5M capital raised between 2014 to 2021 • Investors incl Paradigm Agency, Plug And Play, Ruttenberg, Capital Zed, Tech Coast Angels, WME, ECA Ventures, Regal Funds, ---BUYER: Publicis--- • Diversified agency holding company (#1 by net bookings) • Founded 1926 • Based in Paris • In 100+ countries • 103,000 employees • €13.1B 2023 net revenue ---FINANCIALS (in €): Publicis--- Stock performance as of 7.29 at 940am ET… • Share price: €97.72  • Mkt cap: €24.9B • Up 15.6% YTD • Up 33.1% YoY 1H 2024 YoY results per public filings (PE 6.30.24)... • Net revenue up 5.9% to €6.7B, from €6.3B • Operating margin up 6.1% to €1.2B, from €1.1B • EBITDA up 4.9% to $1.4B, from $1.3B  • €744M in free cash flow, up 2.6% YoY • €3.1B in cash • €3.2B in total debt (incl earnout/buyout) ---DEAL DETAILS--- • $500M purchase price • Expected to close Aug 2024 • 3.3x 2023 LTM revenue multiple ($500M / $150M) • If assume 2024 revenue growth slows to 30% from 50%, implies $200M forward revenue and a 2.5x revenue multiple  • Deal structure undisclosed (likely an earnout) ---DEAL VALUE PROP--- Overall, expand Publicis IM client services… • More creators to target any audience demo, niche • Better creator-client matching, campaign design via Influential AI + Publicis data businesses, Epsilon • Offer holistic digital campaigns that blend IM w/ digital, affiliate channels • Better ROI analysis of IM campaigns for brands, will drive more spend • Retain client media spend as moves away from linear TV and into social / streaming / other digital —IM MARKET NOTES— • $7B in 2023, up 17.4% from 2022 • Up more than 10.6% for all digital ad spend • Est to be $8.1B in 2024 and $9.3B in 2025 • Social spend to be $186B by 2025, exceeding linear TV spend – IM is fastest growing segment ---POST DEAL OPS--- • Influential will operate standalone • CEO Ryan Detert will stay on ---WHAT ELSE I FIND INTERESTING--- Following WPP's acquisition of Goat in 2023, and Stagwell buying LEADERS last week, I expect big agency IM M&A to continue ramping...though few scaled companies remain! I'll write more in my Friday newsletter. -- I'm the founder of RockWater Industries. We do M&A and strategy advisory for media, agencies, and creator economy. My DMs are open.

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Taking the complexity out of animating static key art… We are no strangers to making static art move. When provided art that’s layered with multiple effects, it’s important to have a process to break those files down into a simplified structure to streamline animation and versioning. For Mayor of Kingstown, we had a variety of out of home deliverables that needed to be animated. The first step was assessing how large we wanted to make our base render so that it could work across all final deliverables. We landed on a 6000x4000 render of our base key art without titling. This gave us padding to accommodate all the variations we would need to output. Having a base render helps speed up output vs doing each deliverable individually which is crucial when you are under tight deadlines, as we were when Jeremy had his accident and had a few days to update everything we created to remove blood that was in the original art. When we received the layered Photoshop art, there were masked color correction and effects layers that worked great for static art. Unfortunately, that layer complexity does not translate well to animation. Our first step was to identify the layers we needed to isolate and work with our animation team to give them flexibility, while simplifying the file to make it easier to work with. These layers included the sky, smoke and fire that we knew we would want to turn into animated effects. From there we had a base background with a left and right side as well as Jeremy Renner in the foreground. It is important when isolating the layers and merging the complex effects to maintain the integrity of the initial art. To achieve this, we typically save the initial art as a primary layer to toggle between as we merge assets. This allows us to verify simplification holds up step by step. Once we consolidated the art to what was needed, the layers were imported into After Effects. We utilized a simple camera move to add depth to the scene and replaced the targeted effect layers with motion assets and added simple floating embers. Upon review, we felt something was missing and that is the beauty of animating key art. What works as a still may not work once you take everything provided to you and animate the pieces that make sense. We did not want to distract from the focus on Jeremy Renner but felt the animation needed an additional layer that could enhance the storytelling. We landed on adding pieces of burning paper falling in front and behind him that could motivate the logo and type animations that would be added to each deliverable separately. The process allowed us to rapidly output deliverables once base animation was approved. This was paramount when we had to pivot to new art of Jeremy. Our approach created efficiencies that allowed us to update one file, re-render and re-deliver all units against timely deadlines to be sensitive to the situation and replace assets already running in market.

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For the past 9 months, the Ritual Film Co. and Summit House teams have been grinding alongside the Los Angeles Rams on a massive project. We took a bold bet, deciding we didn't need to rely on a streamer to tell the story of their QB1. Instead, we went all in, determined to forge a direct connection with fans and ignite excitement for the upcoming season. Now, you can watch that bet stream on the NFL Network and Rams digital channels, and let me tell you, it's amazing! But before I go any further, I've got to give major props to Steve Cundari and Matthew Pfeffer for their incredible hustle on this. It took endless weeks of shooting and some seriously insane post-production work in collaboration with NFL Network. Seriously, guys, you should be beaming with pride over what your teams have accomplished. Now, let's talk: Brands, it's time to stop playing the waiting game. You don't have to sit around hoping some third party will swoop in and connect you with your fans. You have the power to tell your own stories, build your own channels, and bring real value to your audience. Forget about those tired conversion tactics or plastering Instagram with digital billboards. Authenticity and understanding that brands are the future entertainment channels, and brand loyalty will come from those channels(see the creator economy and its existence due to authentic connections and true fan ship) And major shoutout to the Rams for taking a big swing with us. Seeing the outpouring of support for Matthew is just the beginning, and I can't wait to see the energy it brings into the next season this fall! Check out the full doc here: 🚀 https://lnkd.in/eEZUWY8V

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Jamie Gutfreund, Jennifer Musil, and Alex Morrison and I were excited to see our new data from The Harris Poll on #creators make Ad Age's Number of the week: 85%. Eighty-five percent of creators today seek long-term partnerships with brands rather than working on one-off sponsored content. Yet the same number of creators have not heard feedback from marketers about how they evaluate their content (metrics and strategy) or what they think of their work. But since 89% of Creators say they have audience insights that brands fail to access, our research urges marketers to go past 'transactional relationships' and bring Creators early into your strategic development; share your goals and strategies. Also, listen to what Creators say about their communities and set up processes to read comments, pay attention to nuances, problems, challenges or marketing ideas that come directly from your intented buyers. There's a better, smarter way to work with creators and extract stronger ROI. You can download our full report at Creator Vision and creator marketplace platform Pearpop, or just reach out to any of us here. #influencermarketing #influencers Stagwell https://lnkd.in/eaauV7Fb

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Some helpful tips on following breaking news. Including resources like Mosheh O. of Mo News, Ad Fontes Media & On The Media.

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The $500M Influential sale to Publicis Groupe is inspiring 2025 M&A planning for large ad networks and agencies. We know this from many active client convos for Q4 planning. Below are 3 key things to know about the deal... - why it’s such a landmark purchase - ebitda valuation multiples - take-home liquidity for 3 founders I do a full in-depth analysis in my article here: https://lnkd.in/gsCaH6eM Comment below if you have any other questions on the deal, or on my valuation and deal proceeds math 👇🏼 The goal of my LinkedIn and newsletter posts are to help make you all better dealmakers, based on learnings from my 20 years of industry and dealmaking experience. — I’m the founder of RockWater Industries. We do M&A and strategy advisory for media, agency, and creator economy. My DM’s are open.

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As a diehard Star Trek fan, I've been absorbed in an audiobook chronicling the 50-year production history of this iconic series. It's a treasure trove of anecdotes and behind-the-scenes tales that have both delighted and surprised me. What caught my attention most was learning about the casting decisions - how certain actors we've come to associate so strongly with their characters weren't originally slated for those roles. Some were even considered for entirely different characters before finding their perfect fit. This revelation made me reflect on our own journeys, how we roam through life trying to discover the character we're meant to play. Much like the casting process in Hollywood, we can't find our true calling without putting ourselves out there. The stories from Star Trek's casting couch remind us that often, we might start aiming for one role, only to find ourselves perfectly suited for another we hadn't considered. The key is to audition – to try new experiences, take on challenges, and open ourselves to opportunities. It's through these auditions in life that we start to understand who we are and where we excel. Just as actors must step onto the stage and perform to discover their ideal roles, we too must engage with the world around us, test our limits, and sometimes, face rejection to ultimately find where we belong. Encouragingly, our "role" in life, much like in Star Trek, may surprise us, fitting us more snugly than anything we could have initially imagined. The process of self-discovery requires bravery, a willingness to explore, and the resilience to keep auditioning, even when the part doesn't seem immediately clear. Remember, the character you're destined to play is out there; it's just waiting for you to step into the audition room of life and claim it. Engage boldly in your quest, try new things, and one day, the role you're meant to embody will land in your lap, as surely as the stars grace the night sky. Live long and prosper. 🖖🏽 #mirandism #unapologetic #unapologeticdude #startrek #PlayYourPart

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Attended a very entertaining podcast recording of On Strategy Showcase last night with Lindsey N. at Wieden + Kennedy here in NYC, hosted by the brilliant Fergus O'Carroll. The panel had mostly pretty complimentary views on the future of where ideas will come from. A few of key sound bites I took as takeaways: - "Nothing defines an idea more than the energy and community it creates" Laura Rowan - "Selling ideas has become much more challenging than making ideas, we used to have decks which were 9 slides long, now they are 90 slides long, we've lost confidence and faith in our own work." Chris Beresford-Hill - "We used to be coming up with ideas for audiences, but now the audiences have their own audiences" Marques Gartrell It's an interesting time for ideas, there's such a craving for them, but perhaps in our world where we have become highly self-reflective, if not bordering self-obsessed I wonder if we are doing enough to really understand what it's like to be a human today. In my experience the ideas which are able to articulate to someone how or why they feel something, better than they can themselves are usually the ones which land the best. Loved the session, thanks Fergus O'Carroll! #marketing #ideas #advertising

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Episode 215 of "Go Deep" titled "Meet Scott Wachter : Brand and Series Specialist" 🎙️: In this episode, host John is joined by Scott Wachter, a witty and intelligent brand and series specialist based in Toronto 🇨🇦. Scott shares valuable insights into the services he offers and his unique approach to promoting brands. Throughout the conversation, Scott highlights the importance of differentiating oneself in the market and provides practical tips for business growth ✨. Listeners will be captivated by Scott's expertise and his passion for helping others succeed. Whether you're a business owner or aspiring entrepreneur, this episode is a must-listen for anyone looking to take their brand to the next level. Don't miss out on Scott's valuable advice and strategies for promoting your business effectively 🚀. Tune in to this episode of "Go Deep" to gain valuable knowledge from Scott Wachter and discover how you can make your business thrive 💪. https://lnkd.in/eAh36SYU #podcast #branding #businessgrowth #toronto

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Morning Musings on the bigger picture of fandom: Building your community of users and fans should be a constant, not a campaign—because true loyalty and engagement are earned long before they’re ever called upon. 💪✨ If your brand only connects with your players, users, and fans when you need something, you’ve missed the point. It’s not only about having a massive user base; it’s about building strong relationships that drive long-term revenue 💸—because loyal fans invest emotionally long before they invest financially. 🔗❤️ The strongest fanbases are built during the quiet moments—not just during big launches or events. 🚀 A loyal fan isn’t just there for your milestones; they’re there for your journey. 🛤️ 💡 Don’t treat your users like a number or a campaign outcome. Make deposits in their experience, excitement, and trust long before asking for a withdrawal. The creators, artists, games, and projects that thrive are the ones that prioritize the relationship over the transaction—by investing in their fans consistently and making them feel valued, heard, and part of something bigger. 🔥🤝 Build a community that rallies with you—not just when you need support, but because they’ve been with you through it all. As a result, when it’s finally time to make that ask, the return is tenfold. 💥📈 #fanengagement, #gaming, #music #web3, #superfans #community #blockchain

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Gen Next! So different. So compelling. So unknown to many. Talk to #Magid to get to know the next generation of consumers and what it means for your business! #consumers #generations

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Blair Rich joining Legendary Entertainment as Chief Marketing and Commercial Officer is like getting Gandalf to lead your fireworks show—it’s bound to be a spectacle. Rich, a former Warner Bros. legend herself, brings her A-game marketing chops to Legendary, the force behind the "Dune" and Monsterverse franchises. To put it mildly, she’s not here to play; she’s here to redefine. And if you look at the roster of films under her oversight—like the upcoming “Minecraft Movie” and an untitled Alejandro G. Iñárritu project starring Tom Cruise—there’s no doubt that she’s about to make some marketing waves. Legendary’s CEO Joshua Grode didn’t mince words when he described her as a “creative innovator,” someone whose mix of vision and strategy is about to “raise the bar for everyone at Legendary.” And Rich? Let’s just say her confidence is sky-high. Though she stayed official in the press release, you can practically imagine her saying, "I’m here to make marketing as thrilling as a Godzilla foot stomp. If that means I have to slap some spreadsheets and give the analytics team a pep talk about unleashing their inner dragon, so be it." (Note: she definitely didn’t say this, but she absolutely should have.) With her Warner Bros. Entertainment. background and a stint as president of Virgin Galactic's commercial operations (yes, that Virgin Galactic, where she worked on consumer-facing space tourism), Rich has a bit of the “out-of-this-world” touch. She’s the kind of exec who doesn’t just plan campaigns; she creates narratives that make audiences feel like they’re living inside the story. Her approach to data analytics—melding raw numbers with creative insights—was considered pioneering at Warner Bros., and she’s bringing that same savvy to Legendary. In the entertainment space, where tech innovation and creative storytelling are colliding faster than two Titans in a monster movie, Rich’s influence couldn’t be more timely. Legendary has been keen to “adopt new technologies across marketing and data analytics” to engage audiences in more dynamic ways, and Rich’s presence is a clear sign that they’re ready to evolve. In her own words, she’s excited to “engage people in unique, memorable ways,” aiming to foster connections that “inspire and elevate their experience” with Legendary’s iconic brands. Expect big things on the horizon: Alongside “A Minecraft Movie,” Legendary is producing a fresh Denis Villeneuve event film and a lineup of series like “Monarch: Legacy of Monsters” that are already generating serious buzz on Apple TV+. For Rich, it’s all about building “first-rate content” while driving unique connections with the audience—and for Legendary, it’s the beginning of a new era of storytelling. In today’s media game, it’s not just about who gets the best effects or the biggest stars; it’s about who can turn a movie into an experience, and few are better equipped than Rich to make that magic happen.

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Great article on Brand Entertainment by Alison Bringé (nee Levy) that discusses the problems and solutions facing Brands today with performance marketing. It got me thinking… Why aren’t more brands building out Entertainment Divisions that focus on creating Scripted TV & Film? Barbie, Lego, and others have had explosive success with it. I’ve seen first hand how SEGA merchandise businesses was transformed within 2 years. Is it cost, fear of the unknown, or the length of time it takes? Something else? #film #tv #business #entertainment #marketing #advertising #ad Original Film

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Just attended an unscripted executive convention, and the discussions around brand-backed production really resonated. The truth is, brands have always been integral to our industry. From the early days when names like Chevrolet and Procter & Gamble pioneered sponsorship in the 1950s with shows like General Motors Presents and The Colgate Comedy Hour, to today’s collaborations with giants like Apple and Coca-Cola, brands have long shaped the entertainment landscape. It’s a tradition as old as television itself. In 2015, my partners and I saw the power of this approach firsthand. One of our projects, initially a tough sell through traditional channels, found its success through a brand partnership. We turned a challenge into opportunity, producing ten episodes with a brand on board, which attracted ten different celebrities who loved the concept and joined out of pure enthusiasm. The result? A financially lean but impactful series with over 500 million media impressions, broadcast in 98 territories. And because we partnered creatively, we retained the IP, while also meeting our partner’s goals, significantly increasing their brand awareness through compelling storytelling. Since then, we’ve developed multiple projects with a variety of clients using this approach. I’m genuinely grateful for the innovative partners who’ve trusted us with their stories and can’t wait to see where future collaborations take us. As storytellers, embracing collaboration—with or without a brand—is key, as is staying inventive. By keeping that door open, we give our projects new ways to thrive, connect with audiences, and grow on a global scale. The so-called “disruption” we’re seeing today is really more of a reset. Together, creators, producers, talent, and brands will continue to weather the storm and succeed. And the story continues… Fred Paik, Jeff Timmons, Natural Balance Pet Foods, Inc., Josh Levenbrown, The Coca-Cola Company,Mattel, Inc., Marc Kamler, Warner Bros. Discovery, A&E Television Networks LLC, Rive Gauche, Courtney Paulson,

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