OilPrice.com founder reveals an investment opportunity in advertising, providing some serious arguments for this.
By: James Stafford, Founder, Publisher and CEO of Oilprice.com
The power of the publishing world brings you into contact with a sea of opportunities.
When I find an undervalued potential market disruptor with an exceptional leadership team - I invest.
I’ve never shared information about my investments before with subscribers, but by popular demand, I’m going to start doing that now on a regular basis.
I’ll only share those in which I’m investing my own money.
When I’m investing heavily myself, the criteria are strict. I’m looking for a company that is:
The market? The ~$130 bn digital advertising space.
The problem? Publishers are desperate to win back their share of over $5bn in ad revenues that gets spent using Google’s news platform.
The solution? A new, independent platform that gives the power back to the people who are actually producing content.
And the company? Frankly Inc., a media firm with a data gold mine and a new way for publishers to escape the stranglehold of Google and Facebook.
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The first thing that popped out to me with Frankly was its reach: It’s already reaching 100 million people.
So, I back-traced that. What does that actually mean in dollar terms? Forbes figures that the personal data of each individual is worth at least $175 when monetized. That would mean that Frankly could be sitting on a potential ~$20 billion in commercial value.
That’s a huge number, so I wanted to better understand why I hadn’t heard of Frankly before. This is what I learned: Frankly’s been operating in the shadows of some of the biggest mainstream news outlets in the U.S. building up its platform arsenal and quietly increasing its reach to 100 million people while no one’s paying attention.
Frankly is the biggest thing in publishing that I’d never heard of, and it’s positioning itself to become the future of publishing. The giants have grown complacent, and they’re not paying attention.
Consider this: The global digital advertising market alone is set to reach nearly $665 billion by 2026.
Then, consider this: Just in the U.S., this is a $100 billion market… and 80% of it is in the hands of Google and Facebook.
From where I’m sitting, it appears that Frankly could upend the total control these tech giants have in the markets.
So, how is Frankly planning to do this, exactly? Through its one-of-a-kind platform that gives all the power back to the publishers.
Publishers (like ourselves) are desperate for Frankly. While Google made $4.7 billion in revenue from news content without actually writing anything last year, the entire news industry combined (over 2,000 publishers) only made around $5 billion.
That ticks another box on our criteria: Voracious demand.
Frankly has also impressed us with the type of data it collects, it’s reach and its digital property portfolio.
The company is undervalued by any means. The $15 million market-cap company has got over 100 million monthly active users in its network, and 1,200 digital news, information and entertainment properties across the US.
The recent $50 million multi-year deal it closed with Newsweek is a great example of Frankly’s deal-flow… and there could be more in the pipeline.
First-party data is where the money is: It’s all the behavioral, personal and subscription information your audience shares with you. It’s what makes targeted advertising one of the most lucrative businesses in the world.
The biggest thing Frankly has going for it is its management. Without good management, potential undervaluation becomes simply low valuation.
They’ve also been quick on the uptake for other streams of revenue and growth expansion, most recently through their acquisition of Vemba, a video-on-demand asset that boasts CNN and VICE as clients, among other big names.
Frankly is where former tech pioneers and publishing executives come together to take advertising revenue back, and its chairman, Tom Rogers, knows what needs to be done. He’s a strategist extraordinaire, who has been a VP of NBC, created MSNBC and even served as Senior Counsel to the US House of Representatives Telecommunications.
As I’ve said, I already have a large position in Frankly, I was adding more last week and will continue buying this week, especially at these levels. Now, I’m bringing the opportunity to your attention as well, before Frankly steps out of the shadows.
You can find their Canadian listing here: https://finance.yahoo.com/quote/TLK.V/?p=TLK.V
And their US listing here: https://finance.yahoo.com/quote/FRNKF/?p=FRNKF
Should any asset managers wish to learn more about the company I would be happy to make an introduction to the CEO.