Novacap capitalizes on shifting ad trends with Cadent acquisition

The deal also marked the exit of Lee Equity Partners, which acquired Cadent in 2013.

The move from advertising on traditional linear TV to more digital methods in advertising attracted Novacap to acquire Cadent, a provider of converged TV advertising, in a deal announced earlier in August. PE Hub caught up with Samuel Nasso, a principal at Novacap, to discuss the deal and the opportunities the Montreal-based PE firm has identified in the advertising space.

The Cadent deal is the fourth investment under Novacap’s TMT VI Fund. It also resulted in the exit of Lee Equity Partners, which acquired Cadent in 2013.

The advertising industry represents a huge market in the US, with billions of dollars spent on ads.

Samuel Nasso, Novacap

As new technologies emerge, change is underway. “Currently, there’s a significant shift from traditional linear TV to more digital methods,” Nasso said. “Yet, live TV, including sports, news, and reality shows, will continue to capture significant audience attention, ensuring its lasting relevance.”

Currently, the market highly values the digital and connected TV (CTV) space due to its rapid growth, said Nasso. “However, it’s overlooking the significance of traditional TV, which still holds the majority of TV budgets. Cadent offers the benefits of both digital and traditional TV.”

He said Cadent has several advantages in the market with its “solid reputation in traditional TV,” leveraging on its expertise to make a mark in the digital CTV sector.

Other advantages include Cadent’s strong network and its technology, Nasso said. He said the company has proven to be resilient in downcycles, including during the pandemic.

Cadent has an aperture platform that simplifies cross-screen advertising through a streamlined workflow that brings together identity, data, and inventory with hundreds of integrated partners, according to the company.

This aperture platform has also helped the company to grow organically, Nasso said.

In addition to its New York headquarters, the company has a footprint in other major US cities and in London, UK.

“Our growth strategy is to add more features and functionality to the aperture in order to have a better one-stop shop for all of our customers,” Nasso said. Part of the strategy will include M&A, especially focusing on scaling the digital side of the business.