2024 marked a year of revival for the digital ecosystem with momentum continuing into the final quarter of the year. The uptick in dialogue over recent quarters contributed to a 28% year-over-year and 5% sequential rise in Q4 deal activity. This marks the fourth consecutive quarter of growth – driven by rationalization / consolidation trades, and a late quarter resurgence in larger, strategic deals, signaling optimism for 2025.
Public markets closed the year off strong with both LUMA.A (+12%) and LUMA.M (+12%) outperforming benchmarks like the Nasdaq and the S&P500 in Q4. The LUMA.A cohort’s strong annual performance (+53%) was led in part by AppLovin’s market-leading +713% price surge. The LUMA.M cohort had nominal growth of (+2%) for the year. On the financing front, early-stage VC investments grew 14% year-over-year, while late-stage funding continued to face headwinds. AI funding continues to be a bright spot, capturing ~30% of VC dollars in 2024.
Looking ahead to 2025, the digital ecosystem is poised for growth in an improving macro environment, supported by sector rationalization/consolidation, regulatory clarity, and AI-driven innovation – all serving as strong foundations for the ecosystem to thrive.
M&A Activity Highlights
- Full year deal volume rose +13% from 2023. Deal volume increased in MarTech and Digital Content – with a notable increase in Ad Tech (+73%).
- Q4 2024 deal volume climbed +5% sequentially, with six scaled Ad Tech transactions – the most since Q4 2021.
- Key deals included Mediaocean’s $500mm acquisition of Innovid, Zeta’s $250mm acquisition of LiveIntent and Experian’s acquisition of Audigent.
Public Markets & LUMA Indices Highlights
- LUMA.A: Up +53% and outperforming the S&P 500 (+23%) and the Nasdaq (+29%) for the full year. Twelve out of the 22 names within LUMA.A traded up in 2024, including 6 tickers above +70%. AppLovin led the cohort with a +713% increase, adding $100bn to its market cap over the course of the year.
- LUMA.M: Up +2% for the year, with Q4 gains (+12%) boosting annual performance. Top performers in the cohort included Similarweb (+166%), Zeta (+104%), and QuinStreet (+80%).
- Ad Tech and MarTech cohorts consistently exceeded Net Revenue and EBITDA analyst expectations during the most recent earnings announcements.
Download the full report for detailed insights on Ad Tech, MarTech, and Digital Content, including the following:
- Quarterly deal activity across Ad Tech, MarTech, and Digital Content.
- Public market trends and recent earnings highlights in Ad Tech and MarTech.
- Public valuation and operational benchmarking across Ad Tech and MarTech.
- Private financing highlights across the sectors.
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