March 6, 2014 - AMHERST, MA: Long River Ventures announced that its portfolio company, Extreme Reach, Inc., the leading video platform for integrated TV, online and mobile video advertising, has completed the acquisition and integration of the TV business of Digital Generation, Inc. (DG, NASDAQ: DGIT). ER will now have projected annual revenues of $250MM, representing nearly 5x growth over last year, and 760 employees. DG’s offices and personnel have been successfully integrated into Extreme Reach, and all DG TV clients are now running on the Extreme Reach platform.
DG clients immediately benefit from the Extreme Reach cloud platform, which offers measurably greater efficiency, speed and reliability over the satellite and tape distribution model formerly used at DG. The Extreme Reach digital network is the world’s largest and includes over 7,000 North American TV media destinations and 3,000 online video publishers. The Extreme Reach platform is the industry’s only platform to enable the execution of TV and online video advertising campaigns together.
“DG provided TV distribution solutions to nearly 6,000 advertisers and agencies,” said John Roland, CEO of Extreme Reach. “Our combined client base of over 9,000 includes most of the largest TV advertisers and all of their TV ads are now managed on our platform. This acquisition underscores our aggressive growth strategy. It solidifies our position as the TV and online video advertising convergence leader. We provide thousands of advertisers and agencies with the most effective way possible to leverage video advertising across every screen and device.”
“With this acquisition, ER becomes the dominant player in the marketplace, only five years since initial market launch,” noted Tripp Peake, General Partner of Long River Ventures. “ER’s technology platform leverages internet delivery and cloud storage. It’s very efficient and incredibly scalable. As a result, the company has not only grown rapidly and profitably on its own, but also now transitioned thousands of DG customers to its own system literally overnight.”
Long River Ventures co-led an initial Series A start-up round in late 2008. That initial round totaled only $1.5MM but allowed the company to get to market, build its network of media outlet partners, and gain initial customer traction. The company required only $7MM in total capital to reach break-even operations after less than 3 years in business. Then in May of 2013, Extreme Reach raised a $51MM Series C round from Spectrum Equity Partners to support an aggressive growth and acquisition strategy.
The DG acquisition, originally announced in August of 2013 and closed last month, was for $485 million in cash. The acquisition was financed by a combination of existing cash, debt financing and new equity from existing investors. Long River Ventures participated, as did all other investors, including Spectrum Equity, Village Ventures and Greycroft Partners. Berenson & Company acted as exclusive financial advisor and Pierce Atwood LLP acted as legal advisor to Extreme Reach in the transaction. J.P. Morgan and SunTrust Robinson Humphrey acted as joint lead arrangers and joint book runners for the $465 million debt facility.
About Extreme Reach
Extreme Reach is the leading provider of cross-media video advertising solutions that span TV, online, mobile and all other video media. The Extreme Reach video platform enables the seamless management, delivery and measurement of multi-screen advertising campaigns. The company’s cross-media video ad delivery network is the largest in the world. Thousands of advertisers and agencies look to Extreme Reach to connect and simplify their video advertising. The company is headquartered in Needham, Mass., with offices in ten markets across North America. Extreme Reach is one of America’s 200 fastest growing private companies (#171, Inc. 500, 2013).
For more information, visit the Extreme Reach website.