Direct Digital Holdings, which provides an end-to-end programmatic advertising platform to SMBs, lowered the proposed deal size for its upcoming IPO on Monday.
The Houston, TX-based company now plans to raise $18 million by offering 2.8 million units at a price range of $5.50 to $7.50. It most recently filed to offer 2.2 million units at a range of $7 to $9 in a late January terms revision that added warrants and slashed the originally proposed share offering. Each unit consists of one share of Class A common stock and one warrant, exercisable at the IPO price. At the midpoint of the revised range, Direct Digital Holdings will raise 2% less in proceeds than previously anticipated and command a market value of $92 million (-15% vs. most recent terms).
Because the company is offering warrants, Direct Digital Holdings is not eligible for tracking and will be excluded from Renaissance Capital's stats.
Formed in 2018 through its acquisitions of Huddled Masses and Colossus Media, Direct Digital Holdings is an end-to-end, full-service programmatic advertising platform focused on underserved and less efficient markets on both the buy- and sell-side of digital advertising. Targeting SMBs, the buy-side component of its business is comprised of Huddled Masses and Orange142 (acquired in 2020), which serves hundreds of clients with more than 4,000 campaigns annually by leveraging insights from leading demand side platforms (DSPs). Colossus Media is its proprietary sell-side programmatic platform, which served over 39,386 clients in September 2021.
Direct Digital Holdings was founded in 2018 and booked $32 million in revenue for the 12 months ended September 30, 2021. It plans to list on the Nasdaq under the symbol DRCT. The Benchmark Company and Roth Capital are the joint bookrunners on the deal. It is expected to price during the week of February 7, 2022.
