Yes, another micro-cap Ad Tech company.
If you’re new to Ad Tech, and still figuring out the difference between a DSP and an SSP, you can get up to speed on the sector by reading my newsletter: “
The World of Ad Tech”
Mobiquity is a DSP that up-listed to the Nasdaq back in December 2021 under the ticker
$MOBQ, and got on my radar from a DM here on
@commonstock. They haven’t reported financials yet, which makes this more of a shallow dive than a deep dive, but they are interesting enough to give it a go.
Without further delay…
Micro Targeting
Mobiquity’s advantage is their ability to target micro audiences with accuracy at scale. They don’t target zones or block clusters, instead they use their HomeGraph software to target real people in real households at the IP and Mobile Ad ID level.
They use unique Co-Location IP-Address algorithms and Mobile Location Staypoint algorithms to determine:
- Home & Work street address
- Historical shopping and lifestyle patterns
- High value points of interest; including dwell time & frequency
They also incorporate offline data to enhance segmenting options such as:
- Auto ownership and registration files
- Consumer demographic, occupation, income data & segmentation data
- Open architecture allows onboarding of 1st party CRM data
A little scary how much data is out there on people, but that’s what you want from an Ad Tech company.
*Of note, according to management, they do not use the dreaded “cookie”. They discontinued all use of cookies over a year ago.
Targeting Segments
Mobiquity’s Audience Buildr is a fully self-service audience construction tool for programmatic marketing.
Audiences can be created through their web-based platform Advangelists by uploading or accessing any combination of the following customer centric data sets:
- CRM Data - known 1st party customers and look-a-like audiences
- Location Data - Leveraging Mobiquity Networks 5.5 million points of interest to create real world observed behavior segments
- Syndicated Data - Including 190 million voter records and 240 million national consumer records
- Contextual Data - Identify audience interactions and behaviors engaging with content across social, search, video and app ecosystems
Audience Buildr includes:
- 450 Million Unique profiles
- 120 Million Households
- 500 Million Points of Interest
- Third-party Data Activation
- CRM System and Data Integrations
They deliver display ads directly to every device used by an audience member. No cookies. No cluster data. No district designations.
Audiences receive tailored messaging which is verified and based on empirical data identifiers.
Q/A
Because they have not report earnings yet, I was unable to get any of the financial questions I had answered, but the Mobiquity team was able to answer a few questions for me. Here are the most pertinent that were answered:
Who is your closest competition?
- The Trade Desk, Media Math, Centro, Beeswax (AcuityAds may be a better comp based on their size and scope)
Are your first party data assets exclusive to Mobiquity or are they leveraged from a data provider?
- We have a mix of first party data assets, acquired via the bidstream or data partnerships. (Unclear if this is unique 1st party data, public data, client 1st party data, or some combination of the 3)
How much of your targeting is dependent on 3P data that is still cookie dependent?
- None, we discarded cookies almost a year ago. (Very interesting!)
Can you share % of revenue split between managed vs self-service?
- Managed 40-50% and self-service 25-35%. (no mention of the other 15-25%)
Can you clarify revenue contribution from display, video, and CTV?
- 40% display, 40% video, and 20% CTV. CTV is growing the fastest. (Good mix and what I would expect to see)
Financials & Assumptions
Mobiquity hasn’t report yet (no date set, but planned for the end of February), so we don’t know a lot about their financials. The only two things we know for sure are:
- They closed a $10.3 million offering on 12/13/21 priced at $4.15/share (no word if this was for Opex or Capex)
- Current market cap is approximately $11 million at the time of this writing.
What we don’t know (among other things) is their cash burn rate or growth rate. So it’s tuff to value them currently, and likely the reason they are trading just above the cash raised two months ago.
Based on their model, it looks like they are designed to get a boost from mid-term elections in the 2nd half of 2022. Based on where some others in this space are trading vs. revenue; I could see them doing between $10-$20 million in 2022. Earnings will be interesting.
Summary
Mobiquity got hit hard along with the rest of micro-cap growth companies, and the offering in December severely amplified the sell-off. The general return of advertisers to the market and mid-term elections should boost revenues in 2022. But without comparables it’s still a crap shoot.
Micro-cap investing is an interesting space, tuff to get information, yet so much opportunity if you can find the diamond in the rough. It’s yet to be determined if Mobiquity is a diamond, but the cash to market cap ratio has me intrigued, lowering the short term risk in price. The potential revenue acceleration from advertisers returning to the market and mid-term elections has me optimistic about the potential upside.
Trading just above cash, and likely under next years revenue, even with the unknowns, the risk/reward here looks decent. I started a small tracking position (now raised to a starter position), and may add to it over the month leading up to earnings. It wouldn’t take much to get them back over $4/share in my opinion.
I’ll be paying close attention to earnings, which should answer most of my financial questions. I'm also learning more about their hardware (and areas of coverage) that makes everything work. I plan on updating my thesis and providing more detail on their hardware after earnings, then I'll decide if this is a short or long term hold…
You can find the original article here:
MobiquityAs always, curious what the community thinks... 👇
🦜
