DoubleVerify, a company that builds software for digital media advertisers, was trading up 28% after launching its preliminary public providing Wednesday. 

Shares opened at $35, up from its IPO value of $27, to succeed in a market cap of greater than $5.three billion.

The company offers software to measure digital media advert placements, marketing campaign effectiveness and analytics. It makes an attempt to assist advertisers guarantee advertisements are viewable, non-fraudulent, within the appropriate geographies, and “brand-safe,” or not adjoining to content material that advertisers may deem problematic, like controversial political content material or faux information. It has direct integration with programmatic gamers (like The Trade Desk and Google), social media platforms (like Facebook, Google’s YouTube and Snap) and related TV gamers (like Amazon and Roku), in line with its prospectus. 

“Think of us as promoting safety software,” DoubleVerify CEO Mark Zagorski informed CNBC. “We make sure that an advert transaction is fraud-free, that the advert is delivered to an actual individual that may truly see it, not a bot, and that it is delivered in a context that is secure for that model.” 

The company is the newest in a slew of advert tech gamers to go public in latest months, together with PubMatic, Viant and Kubient.  

“As {dollars} proceed to shift into digital and even into digital areas like related tv, fraud continues to be a problem to create belief between consumers and sellers,” Zagorski mentioned. “The surroundings for our product has by no means been extra ripe.” 

DoubleVerify generated income of about $244 million in 2020, up from $183 million in 2018. The company has about 1,000 clients, in line with its S-1. 

“We’ve acquired a very nice diversification of purchasers,” Zagorski mentioned. “During Covid final 12 months, when retail and journey simply collapsed, we nonetheless managed to develop 22% throughout Q2….” 

He sees progress as coming from new protection sectors, like getting deeper into related TV, audio and podcasting. Growth also needs to come from new geographies and new merchandise, he mentioned. 

DoubleVerify mentioned in its prospectus that its main opponents are different digital advert measurement suppliers like Integral Ad Science, in addition to Moat and Grapeshot, that are half of Oracle Data Cloud. It mentioned different firms present level options that handle sure facets of digital advert measurement. Google also said last week it would add a brand new instrument to make it simpler for advert consumers to dynamically block websites and domains that do not meet their model security requirements.

Providence Equity Partners acquired a majority stake within the now 13-year-old DoubleVerify in 2017. The company additionally raised a $350 million personal fairness spherical led by Tiger Global Management in November 2020. 

Davis Noell, senior managing director at Providence and chair of the board at DoubleVerify, informed CNBC he believes DoubleVerify fills a novel function as an impartial strategy to measure digital advertisements’ effectiveness.

“When we first made the funding, it was clear there was a necessity for an impartial supply of measurement within the digital promoting ecosystem to convey that transparency to your complete ecosystem,” he mentioned. “And in order that’s not one thing that Google can do, or Facebook or The Trade Desk, or anyone that is actually concerned in shopping for and promoting media.” 

MKM Partners wrote in a notice that DoubleVerify advantages from developments like progress in digital advertisements and a shift towards programmatic advert shopping for. They added that its core worth proposition relies upon on three rising focus areas: The potential to guard model status, to detect fraud on the web, and to measure advert spend effectiveness. They additionally cited the company’s rising group of massive clients representing not less than $1 million in annual income; from 25 in 2018 to 45 in 2020.

But MKM mentioned the company additionally faces danger of disintermediation from massive walled gardens and huge advert tech gamers like The Trade Desk. It added that although the company did not point out having buyer focus danger of any buyer accounting for greater than 10% of its income in 2020, it did say two programmatic companion platforms collected about 12% every of its complete income in 2020 on behalf of DoubleVerify’s advertiser clients. 

The concept of “model secure” promoting has drawn criticism, particularly initially of the pandemic when manufacturers had been utilizing it to attempt to keep away from showing close to coronavirus-related content material. 

Zagorski mentioned the company has labored to evolve some of these instruments. 

Every greenback that goes to faux information or political hate speech is a greenback stolen from a professional writer, he mentioned. “That is our drive, is to create a stronger relationship between professional publishers and advertisers, in order that actual content material will get funded.”

Zagorski mentioned that entails the company being certain it is utilizing a scalpel versus a “meat cleaver.” That entails an evolution of how the company appears at content material, as an illustration, and being extra deliberate in regards to the context a phrase may seem in — “capturing” within the context of violence should be treated differently than “capturing a photograph” or a “capturing star.” 

The company can be working with advertisers on model suitability “tiers” to find out ranges of sensitivity to sure classes.

“Instead of working with a meat cleaver to say, ‘I do not need to be round any political speech, I do not need to be round something that engages this kind of dialogue,’ they’ll have a sensitivity round that,” he mentioned. “And that sensitivity can change on a brand-by-brand foundation or region-by-region foundation.”