Source: Snap had acquisition talks with AdRoll, which is borderline profitable and on pace for $300M 2017 revenue; Snap actively looking at other ad tech firms
Snapchat is shopping for ad tech companies to help bolster its appeal to marketers, a process that led the company …
Context & Ripple Effects
Snap has been building out its advertising business in stages: it started with an ad API and outreach to potential partners in early 2016, then launched Snap Ads Between Stories alongside that API in June 2016. The reported acquisition talks with AdRoll show the next phase — buying ad tech capability rather than building all of it in-house.
AdRoll fits a specific need: at roughly $300M in 2017 revenue and borderline profitable, it is a scaled retargeting business Snap could bolt on to make its inventory more appealing to performance marketers. The talks also signal Snap is actively scanning other ad tech targets — a scan that produced results by November, when it acquired Metamarkets for less than $100M.
First-order effects
- Snap gains a shortlist of proven ad tech assets it can buy instead of building, with AdRoll's retargeting revenue base and borderline profitability making it an unusually self-sustaining target.
- AdRoll becomes a named acquisition candidate, which raises its negotiating leverage and puts other potential buyers on notice while talks are live.
Second-order effects
- The eventual Metamarkets purchase for under $100M shows Snap converting this scouting process into deals, prioritizing measurement and analytics infrastructure over AdRoll-style demand-side scale.
- Competing platforms' ad tech vendors face a well-funded strategic buyer entering the market, which can lift valuations across the mid-tier ad tech sector as Snap keeps looking.
Third-order effects
- If the pattern holds through later moves like the $124.4M Fit Analytics deal, Snap's playbook is durable: acquire capability companies to close gaps against larger ad platforms rather than compete on R&D alone.
- Mid-sized, near-profitable ad tech firms become consolidation targets for social platforms racing to offer full-funnel buying, measurement, and commerce — shifting industry structure toward platform-owned stacks.
The trend: Social platforms are assembling their ad businesses through targeted capability acquisitions, with Snap's AdRoll-to-Metamarkets-to-Fit Analytics sequence as a running case study.