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Bidstack acquires ad-monitoring firm Pubguard as its major growth push continues (BIDS)

Bidstack (LSE:BIDS) sat at 33p a share on Thursday morning after taking its first step into growth by acquisition with the purchase of advertisement monitoring firm Pubguard. Bidstack, an £80m video game advertising business that has enjoyed a significant rise this year, will pay £300,000 in shares priced at 34.5p each to take over Pubguard.

Pubguard, the trading moniker of an organisation called Minimised Media, has built software that automatically reviews advertisements served in-app and on mobile and desktop web content. This allows it to identify offensive, malicious, and illegal ad content and malware that can then be blocked at a client’s discretion.

Bidstack plans to incorporate Pubguard’s technology into its own offering, which can place adverts into natural spaces within video games across numerous platforms. This service could, for example, see it put promotional material onto anything from a virtual billboard on a building or vehicle in an open world or cityscape to a banner or flag by the side of the road in a rally game.

The organisation begins its service by securing access to natural advertising space within a video game from the title’s publisher or developer. They then split any revenues generated from selling this space on an agreed basis. On the demand side, advertisers then pay Bidstack to insert adverts onto the area the firm has secured from publishers and developers within video games. In Thursday’s update, Bidstack’s chief executive James Draper said Pubguard’s technology could protect these advertisers and gaming studio directors – as well as gamers themselves – from fraudulent activity.

Brand safety and fraud have become increasingly important topics in the advertising industry over recent years. Indeed, according to a recent Brand Safety report, 65pc of advertisers are currently operating in environments that are not safe for their brand. Elaborating on this, Justin Wenczka, chief executive of Minimised Media, said that video games have become a significant target for fraudsters due to their high levels of user engagement.

‘It makes sense for us to focus on an area of great need with the fantastic team at Bidstack,’ he added. ‘Gaming is part of our company culture so we know the huge potential of unlocking multi-platform ad spaces and the need for increased safety measures to protect its sensitive demographics. Bidstack has a tremendous focus and comprises of some of the best talent in the industry and we’re looking forward to achieving great things together moving forward.’

Elsewhere, Bidstack said it expects to maintain and use the Pubguard platform to enhance its current technical and commercial offering as part of its Software Development Kit. It added that the acquisition provides a ‘ready-made solution to enhance the Bidstack platform’ that will save it several months of development time and resource.

‘Pubguard brings a number of technical and commercial upsides to Bidstack. First, we are protecting gamers against fake adverts that, for example, could redirect them to adult content.  Second, Pubguard brings the group technology and a brand that is respected in the gaming and digital media space,’ added Draper. ‘As we have said previously, our intention is to grow Bidstack to become a significant media owner in the video games market.  We stated Q3 would be an important period for us and I believe the purchase of Pubguard, our first venture into growth by acquisition, shows our commitment towards commercial innovation.’

To support its goal of becoming a leading figure in the advertisement industry, Bidstack has spent the last few months adding several high-profile industry figures to its management team. For example, in July, it appointed highly experienced software technologist Derek Wise, currently VP of contextual intelligence with Oracle Data Cloud, as a non-executive director.

Likewise, April saw the company establish an advisory committee to harness the talents of a select group of high-profile executives from both the video games and digital advertising industries. Current members of the committee include Pete Beeney, who manages Spotify’s global partnership with WPP, and Joel Livesey, chief executive of The Trade Desk. The pair are joined by Ian Hetherington, co-founder of video game develop Psygnosis, Jon Epstein, founder of GameSpot and senior VP of international for Sentient, and high profile lawyer Nav Sunner.

To read our interview with Draper, in which he discusses his plans for Bidstack to become ‘the biggest video game advertising media owner in the world’, please click here.

Valuethemarkets.com and Dynamic Investor Relations Ltd are not responsible for the content or accuracy of this article.  News and research are not recommendations to deal, and investments may fall in value so that you could lose some or all of your investment. Past performance is not an indicator of future performance.

  • Daniel Flynn currently holds a position or positions in the stock(s) and/or financial instrument(s) mentioned in the piece.
  • Daniel Flynn has not been paid to produce this piece by the company or companies mentioned above.
  • Dynamic Investor Relations Ltd, the owner of ValueTheMarkets.com, has not been paid for the production of this piece by the company or companies mentioned above.

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