Adtech company ID5 said Tuesday it had raised $20 million in Series B investment. It plans to use the funds to help it expand its identifier technology from the web to more channels like mobile apps and connected TV.
Appetite in the digital ad community for alternative identifier solutions has been on the rise in recent years, thanks to the rollout of global privacy regulations and the impending death of third-party cookies. This signal loss, together with growing concerns about data privacy, have made it more challenging for advertisers to precision-target ads and measure whether their campaigns were effective.
Founded in the UK in 2017, just before Europe’s General Data Protection Regulation came into effect, ID5 offers a solution that’s similar to the marketing functions of a cookie. Its identifier attaches to a user’s device when they visit a website or app. Publishers can enhance that with their own first-party data like hashed email addresses or phone numbers. The user is asked whether they would like to opt out, and the identifier carries strict permissions, so it can only be used by certain parties. ID5 allows a retailer, for example, to serve an ad to someone who had previously browsed its website and consented to their data being used for this purpose.
ID5 generates revenue by licensing its identifier to companies that use it to activate data or set up private marketplaces. The ID5 identifier has been deployed by more than 66,000 publishers, per the metadata company Sincera. ID5 lets publishers make their audiences addressable to buyers for free, which has helped it become the most widely adopted identifier by publishers globally, according to Sincera. In that space, it competes with the likes of Lotame’s Panorama ID and The Trade Desk’s Unified ID 2.0, though many of these identifiers are also interoperable with one another.
Mathieu Roche, cofounder and CEO of ID5, said the company’s revenue had grown by about 100% year-over-year, and that the company expects to be profitable by the end of this year or early next.
ID5 has now raised just over $27 million in funding to date, though the company declined to disclose its post-money valuation. New investors in this round included the credit reporting and data agency TransUnion and advertising veteran Martin Sorrell’s venture capital firm S4S Ventures. Existing investors Progress Ventures, Seventure Partners, 360 Capital Partners, Axio, and Aperiam Ventures also participated in the round.
With Google’s Chrome expected to cut support for third-party cookies at the end of this year, the digital ad industry on the open web is heading for a “real y2k” moment, said Sorrell, who is also executive chairman of the marketing services group S4 Capital.
“It’s a real issue and very few clients are well prepared with integrated data sources,” Sorrell said. “One of the biggest growth areas for us has been helping clients find their way through this, and what we’re doing with ID5 supports that.'”
Matt Spiegel, executive vice president of TransUnion’s TruAudience growth strategy, said ID5’s and TransUnion’s identity and data signals will be complimentary to each other.
“Our worldview is that the solutions for identity and the next wave isn’t a single thing,” Spiegel said. “It’s a complex ecosystem that companies like us need to make simple, and Matt and the team are helping us do that in some key ways.”
ID5 now hopes to expand its identifier into new areas like CTV, mobile apps, and audio. They all come with different sets of challenges, Roche said. The app ecosystem is more focused on measurement, for example, while the TV space is motivated by data protection because broadcasters “don’t want to replicate the mistake of web publishers who have been robbed at gunpoint of their data,” Roche added.
ID5 intends to grow its team from around 50 people currently to around 70 by the end of next year, hiring across the business in areas including sales, marketing, and engineering.
Check out key slides from the pitch deck that helped ID5 raise $20 million in Series B funding.