Pictured: Jim Ferry, Partner at Volition Capital
Over my past 10 years at Volition Capital and since our founding, we have been active investors in the AdTech space. Our investments have included Connatix (Exited: Court Square), VisualIQ (Exited: Nielsen), Aditude, and most recently Screenverse, where we announced our $10.5M investment in May.
During this period, the AdTech industry has experienced disruptive generational shifts including the growth of alternative digital channels, such as mobile, CTV, and DOOH. On top of these trends, one of the most controversial developments in this sector has been around Google’s intentions to deprecate cookies. Google first announced in 2020 they would be removing cookies after many of their browser competitors like Safari (2017), Mozilla (2019), and Edge (2020) did so.
In the years since the initial announcement, Volition has long been skeptical of whether Google would ultimately remove cookies for a variety of reasons. Specifically, in April of ’22, I wrote a piece titled “Go Ahead, Track My Online Data.”
This piece discusses a variety of topics including how targeted ads based on personal data is critical to the success of the internet, from both a monetization and experiential perspective. Additionally, I shared that while the move to tighter restrictions around data is marketed as giving users more ownership and privacy of their data, “the inverse may be true.” In this scenario, Google’s walled garden would get taller as they would still have access to consumers data while other parties would not.
Another key aspect of the Google story that has made us question whether they would deprecate cookies is the scale that Chrome operates at compared to other browsers. Specifically, Google Chrome is used by over 50% of users in North America and over 60% of internet users across the world. Due to the fact that they are the last remaining cookie internet browser and therefore critical to the estimated $677 billion global digital ad spend industry, the loss of cookies on the platform would be devastating for publishers and advertisers alike.
As the years went on and more regulatory questions came into play, it seemed as if the industry as whole was calling Google’s bluff. Many of the cutting edge founders that we were talking to just were not preparing for a cookie-less world.
Last month, those that questioned Google’s attempts to create a cookie-less world were vindicated. Google officially shared after feedback “from a wide variety of stakeholders” including the UK’s Competition and Markets Authority (CMA) and Information Commissioner’s Office (ICO), that they no longer will be looking to deprecate cookies. Rather, Anthony Chavez, VP of Google’s Privacy Sandbox, announced that they would be introducing a “new experience in Chrome” that will give people “an informed choice” across their browsing that they can “adjust at any time.
When I talked to Aditude CEO, Jared Siegal about his reaction to the decision, he shared the following: “I believe most publishers are probably celebrating right now. Whatever the future state is going to be, it seems less doom and gloom. Google is now asking for far more feedback from publishers and advertisers, so the hope is the eventual privacy sandbox solution will be more on par with what everyone involved needs.”
Volition has always believed in the power of the AdTech space and what this can mean for consumers, founders, and value creation regardless of the changes in the marketplace. If you are a founder in the AdTech space, reach out as the Volition team would love to connect.
Want to read more of Jim Ferry’s thought pieces? Make sure to check out his profile page for additional articles by Jim.
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