Direct Digital Holdings, the company that owns Colossus SSP, has secured $20 million from New Circle, an investment company. The deal is a share purchase agreement, meaning New Circle will buy shares from DDH over time, providing capital as needed. Direct Digital Holdings, which we’ll call DDH to make this easier on our typing fingers, says it plans to use the new funds to “drive key growth initiatives” for its SSP and advertiser businesses.
On the SSP or Colossus side, the company will use the investment to build out new products, including segments centered on KPIs like carbon and attention. The company will also use the funds to set up more direct DSP integrations and support its work bringing underrepresented publishers into programmatic via their SSP. (Colossus is a Black-owned and operated SSP and specifically works with underrepresented publishers.)
On the demand side, DDH will bring together its Orange142 and Huddled Masses agency businesses to “enable the delivery of new capabilities” in AI, CTV, and retail media.
Why This Matters:
The areas DDH says it will focus on all make sense. Quick overview on each and the broader context here:
Carbon & Attention — Advertisers are increasingly focused on attention as a metric. At the same time, there’s growing interest in carbon-conscious advertising, as brands want to reduce the environmental impact of their campaigns by optimizing ad delivery to minimize carbon emissions. Colossus’ TBD segments align with broader industry goals of improving ad effectiveness and promoting sustainability.
Direct DSP Connections — Supply path optimization (SPO) has been a concern for advertisers. By creating more direct ties with DSPs, Colossus SSP can wean off of intermediaries and reduce hops, improving transparency in ad buying for greater control over where ads run.
Diverse Publishers in Programmatic — Many underrepresented publishers struggle to sell programmatically due to a lack of resources, knowledge, and tech access. This also leaves good content out of the programmatic ecosystem. SSPs that specialize in supporting diverse publishers, like Colossus or a DXKulture, play a big role in bridging this gap, and DDH says its financing will help Colossus continue that work.
AI, CTV, and Retail Media — The use of AI in advertising is on the rise. Meanwhile, CTV and retail or commerce, as ad channels, media are fast-growing. Providing more capabilities here across a combined agency makes sense.
Experts React:
Mark Walker, DDH CEO and Co-Founder, said, in a press release, “The funding will enable the expansion of our technology and strategic capabilities, benefiting both publishers and advertisers. It also opens the door to new growth opportunities and strengthens our commitment to increasing shareholder value.”
New Circle’s BJ Arnold, Managing Partner, said this about the deal: “New Circle is pleased to partner with Direct Digital Holdings, helping to fuel the company’s growth and support their innovative technology and industry-leading approaches to advertising.”
Our Take:
For Direct Digital Holdings, the financing will help push forward some interesting initiatives that benefit publishers and advertisers. DDH made some noise recently at Advertising Week, announcing a project with the MRC and a partnership with cybersec company, Confiant.
