Danoo acquires IdeaCast
Deal amasses out-of-home screens for ad salesIn a deal designed to consolidate the highly fragmented digital out-of-home advertising industry, Danoo has acquired IdeaCast from National CineMedia for undisclosed terms.
As part of the deal, National CineMedia and Danoo's investor, Kleiner Perkins Caufield & Byers, each will hold a minority interest in the new, combined company and have seats on the board of directors.
The deal brings together four digital out-of-home networks: Danoo's City network in coffeehouses and cafes across five top markets; Danoo's Traveler network in airport newsstands rolling out to 40 airports; IdeaCast's Health Club TV Network in 1,000 clubs across 100 markets; and IdeaCast's Airline TV Network, installed in 7,800 seatbacks on JetBlue, Frontier and Continental Airlines. Combined, the networks reach 30 million monthly consumers.
San Francisco-based Danoo will be operating and selling all inventory and venues for both IdeaCast's Health Club TV Network and Airline TV Network. Aileen Lee, a partner with Kleiner Perkins Caufield & Byers who has served as CEO of Danoo for two years, will head up the combined company until a new CEO is named. Jason Brown, president of sales and marketing for IdeaCast, will manage sales for the combined company.
"It's an amazingly complementary fit," said Lee, who began speaking with National CineMedia about a year ago. "We're getting to real scale."
While digital out-of-home is growing, its promise is limited by fragmentation and hundreds of companies, few with national reach and geographical scale. That adds up to a major migraine for advertisers wishing to buy into the space. So far, there have been only a handful of mergers, including the creation of Outcast from the merger of Fuelcast and Bhootan and Zoom Media & Marketing's acquisitions to build out its networks in health clubs and bars.
"There are too many different models and metrics," said Kurt Hall, CEO for National CineMedia. "The media world is ready, but it's our responsibility to provide the research and metrics to buy it effectively."
Both Danoo and National CineMedia, which sees development of the emerging space as part of its long-term growth, plan to collaborate on building out that space. Conveniently, Danoo's new New York office will be across the hall from National CineMedia.
"Cinema is ahead in the digital out-of-home space, but clearly two to four years down the road, we'll be looking to add growth," Hall said. "We see this as an incubation platform for NCM."
Danoo also isn't ruling out further acquisitions. "We have our eye out for how we will grow next," Lee said.