Liberated Syndication Inc. (“Libsyn”) announced it has closed the previously announced acquisition AdvertiseCast, LLC (“AdvertiseCast”).
The consideration at closing consisted of $30 million, of which $18 million was paid in cash; $10 million in the form of newly issued Libsyn shares; and $2 million in the form of an earn-out, which is subject to the terms and conditions of the purchase agreement. AdvertiseCast Co-Founders Trevr Smithlin and Dave Hanley will remain with AdvertiserCast and serve as Chief Innovation Officer and Chief Revenue Officer, respectively.
Libsyn President Laurie Sims stated, “We believe AdvertiserCast, a market leader in podcast advertising, is a perfect fit with Libsyn’s strategy to provide independent podcasters robust tools. In addition to our host-read and programmatic advertising, we have identified even more synergies between our respective customer bases that will create additional upside for strong monetization solutions.”
Ms. Sims continued, “Libsyn and AdvertiserCast had the opportunity to present at the IAB Upfronts held in May of 2021, highlighting shows hosted by Libsyn along with clients of AdvertiseCast. The IAB reported almost 7,000 registrants for the three-day event, Podcast Upfront’s biggest virtual audience to date. It is clear from the reception we received that advertisers are enthusiastic about our combined customer bases. These synergies will create additional upside to attract advertisers to our platform. This feedback is consistent with industry growth estimates we are seeing. For example, IAB projects podcasting will see $1 billion in ad revenue in 2021 and $2 billion in 2023.
AdvertiserCast Co-Founders Trevr Smithlin and Dave Hanley commented, “AdvertiserCast has started 2021 off with a strong first quarter and our partnership with Libsyn will help accelerate our growth throughout the marketplace. In working with Laurie and her team since we announced the transaction, we have found a group of dedicated people who are extremely motivated to solidify Libsyn’s position as a market leader in the podcasting space including the rapidly-growing advertising market.”
In conjunction with the closing of the AdversiseCast acquisition, Libsyn also closed on a private placement led by Camac Partners, LLC, which was a pre-existing shareholder, new shareholder Hudson Executive Capital, LO, and several other new and existing investors. The gross proceeds from the private placement were $25 million.
Liberated Syndication Inc. (Libsyn) announced it has entered into a definitive agreement to acquire AdvertiseCast LLC, one of the largest independent and fastest-growing podcast advertising companies. The combination of Libsyn’s 75,000 podcasts and AdvertiseCast’s premier advertising capabilities will accelerate revenue opportunities for podcast creators and provide advertisers with significant new inventory. The acquisition will position Libsyn to be the leading platform for both hosting and monetization.
“I am thrilled to announce this acquisition. AdvertiseCast is a market leader in the podcast advertising space that will fit perfectly with our existing Libsyn 5 hosting platform. Since we began in 2004, our primary objective at Libsyn has been to enable independent podcasters by providing them with a strong set of tools to help them thrive,” said Libsyn President Laurie Sims. “AdvertiseCast expands our tool set to include a robust monetization solution that enables efficient host-read and programmatic advertising. We expect to generate meaningful revenue by offering the AdvertiseCast solution to Libsyn’s customers and leveraging the combined inventory to attract even more advertisers to the AdvertiseCast platform.”
Founded in 2016, AdvertiseCast’s self-serve marketplace enables podcast advertising for over 1,500 active mid- and large-tier podcasters currently on its network and allows advertisers and agencies to efficiently buy and manage advertising campaigns in the podcast sector. Since inception, AdvertiseCast revenue has grown rapidly, increasing 45% year over year in 2020 to approximately $12 million. AdvertiseCast has scaled profitably since inception with no outside investment.
AdvertiseCast Co-Founders Trevr Smithlin and Dave Hanley commented, “We founded AdvertiseCast with a podcast publisher’s mindset and believe it is a perfect fit with Libsyn’s creator-centric ethos. Given the large growth in the podcasting market, we felt this was the perfect time to join forces with Libsyn in order to accelerate the growth of our business. As a leader in the podcast hosting space, Libsyn has a world-class podcast hosting platform that will deliver meaningful inventory to our podcast advertisers. Advertising is still a very under-penetrated segment of the podcast market, and we believe we are strongly positioned to ride the advertising wave with Libsyn’s support.”
Under the terms of the purchase agreement, Libsyn will acquire all of the issued and outstanding membership interests of AdvertiseCast in consideration for a purchase price of up to $30 million, of which $18 million will be in cash, $10 million will be in newly issued Libsyn shares, and $2 million will be in the form of an earn-out, which is subject to the terms and conditions of the purchase agreement. Co-Founders Trevr Smithlin and Dave Hanley will remain with the company and enter into employment agreements as a condition to closing. The acquisition’s closing is subject to other customary closing conditions.
Libsyn is also pleased to announce it has received funding commitments of $25 million through a privately placed equity transaction (“PIPE”) in Libsyn. The financing will be led by existing shareholder Camac Partners, LLC and new shareholder Hudson Executive Capital LP, among other existing and new investors. Proceeds of the PIPE will be used primarily to fund the AdvertiseCast acquisition and to provide Libsyn with additional capital for other strategic acquisitions. The closing of the PIPE is subject to customary closing conditions and is expected to occur concurrent with the closing of the AdvertiseCast acquisition in Q2 2021.