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174. Bull, Bear & Beyond – Tradedoubler: executive interview
10 Plays8 days ago
From business model to growth ambitions – in this interview, Matthias Stadelmeyer, CEO of Tradedoubler, introduces the company and shares its path forward. He explains its unique value proposition: risk-free, outcome-based advertising through partner and influencer networks supported by proprietary technology. Matthias outlines Tradedoubler’s ambitious growth plans, including expansion into new markets such as the US and Brazil, leveraging AI for efficiency and growth, and maintaining strong financial targets of 10% annual revenue growth and 25% EBITDA/gross profit margins. He also highlights influencer marketing as a fast-growing segment and confirms M&A as part of the strategy to strengthen the portfolio.
Tradedoubler (Nasdaq Stockholm: TRAD) is a pioneer in performance-based digital marketing, operating in more than 90 countries with over 3,000 brands.
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Transcript
Introduction to Matthias Stedlmeier and Trade Doubler
00:00:06
Speaker
Hello and welcome to Edison TV. Today I'm joined by Matthias Stedlmeier, CEO of Trade Doubler. Trade Doubler is a global marketing and technology company that helps advertisers and publishers grow through performance-based solutions, market data insights and advanced tools for tracking the customer journey.
00:00:27
Speaker
Matthias, many thanks for joining me today. Thank you so much, Dan. Thank you. Great to be here.
What is Trade Doubler?
00:00:34
Speaker
And can we start with an introduction to the business? You're a leading European digital performance marketing company. You've got quite a long track record.
00:00:41
Speaker
Can you give us some background on the company and the main areas in which you operate? Of course, with pleasure. So Trey Dubler is a pioneer in performance focused digital marketing services and technology.
00:00:55
Speaker
The company was founded in 1999 in Stockholm by Martin Lorentzson and Felix Hagner. The name of Martin Lorentzson probably rings a bell. He later went on to be one of the founders of Spotify. Today we do business in over 90 countries for a little bit more than 3,000 brands who we call our clients.
00:01:15
Speaker
Our main business areas are partner marketing and influencer marketing where we have built networks of more than 300,000 publishers or respectively over 1 million influencers to do advertising on behalf of these brands.
00:01:31
Speaker
The business itself is built on a proprietary platform, which is why we call our Salsa technology company, which provides tracking the payments and many other functionalities to enable smooth collaboration between brands and partners. And then on top of that, the services, we offer global services, but with the local expertise. So we have around 400 people sitting in 18 offices being really close to the brands and partners and influencers that we're working with.
How does Trade Doubler ensure a risk-free marketing approach?
00:02:01
Speaker
And digging into your value proposition specifically, particularly why do your customers choose Trade Doubler over your competition? Well, we are a risk-free option.
00:02:14
Speaker
Partner marketing is the only channel in digital marketing that is based on outcomes only. So a trade-up that the brands generally pay only for results. We place advertising on publisher websites or influencer channels, and the brand pays a commission only when a sale has happened or if a desired action has taken place like an app download, lead generation, or a sale.
00:02:37
Speaker
Our clients consistently report strong return on ad spend and incremental value that we deliver to them through our partners. So we are able to deliver measurable success based on our three main assets that I mentioned already at least a little bit, the vast network we have, the technology, and then this global approach with the local
What are Trade Doubler's financial goals?
00:03:00
Speaker
expertise. That is what makes us unique.
00:03:04
Speaker
And now turning to financial performance and your financial goals. You've got a good track record of financial performance, but specifically you've also said that you're targeting growth of 10% per annum and EBITDA to gross profit, profit margin of 25%. Can you put that in context context with where you are now and also discuss how you aim to meet these targets and then perhaps also touch on how you're incentivized to to drive this performance?
00:03:36
Speaker
Of course. We have grown revenue by more than 10% in recent years. We will continue to do so this year as well for 2025. I don't tell you too much about that. You can see that in our numbers so far very well. Our margins are getting closer to the target and we are continuously balancing between the earnings and further investments that we want to put put into our growing business because we basically have so many different opportunities to grow further.
00:04:04
Speaker
In essence, we have identified four key growth areas. We want to continue to grow in existing markets to emphasize and strengthen our leadership position. We're expanding into new markets. So we have launched in Australia, the United States, Mexico, and we have now Brazil on the agenda as well. We are leveraging our client base, so the 3,000 brands that we're working with for new products.
00:04:29
Speaker
So, for example, we're rolling out to influencer marketing, rolling out to app marketing. And then we're utilizing AI to drive efficiency internally. But we see a great opportunity as well for AI being a driver for additional growth.
00:04:44
Speaker
Coming to your a question about our incentive. So the management of Trade Doubler is and incentivized on an annual EBITDA result. So we get a variable salary based on the EBITDA result we bring in. And we do have a long term incentive scheme in place that is linked to the development of the share price of Trade Doubler.
What is the US expansion strategy?
00:05:03
Speaker
Thank you. And you mentioned the US there. You've got ambitions to replicate in the US what you've achieved in Europe. And I understand that you personally are spending a significant amount of time there to oversee the expansion. um Can you talk through your strategy in the US for getting market share in that region and also discuss the competitive environment and how that might differ from from that in Europe?
00:05:31
Speaker
um We have started to like we have set up business in the United States officially this year, but we have started to expand into the United States already two, three years ago. So we have started by expanding existing clients basically from the UK, international clients that we have across Europe and other markets. We have started to expand to the US.
00:05:54
Speaker
With these then on board, like we had around 150 brands live in the beginning of this year, and we started to set up an office, have a legal entity, and then focus on building a network of publishers, which is then obviously the main requirement for us to be able to play in a new market. And now we think that we are in a position to approach local clients.
00:06:16
Speaker
Today, now at the end of 2025, we have a little bit more than 200 clients in the United States. So we make we have good traction. The principal business there and the market conditions in the United States are very similar when it when you compare to other Western countries. But it's as with every country, basically, it's these small differences in culture, focus and mindset that matter. This is why it's so important to have a local team and being present there.
How does influencer marketing fit into Trade Doubler's model?
00:06:46
Speaker
Influencer marketing is a a more recent addition to the company. Can you talk about the similarities and differences compared to your partner marketing business and also the growth and profit outlook for that part of the business? And and fundamentally, how big do you think that that but that part of your business could could become?
00:07:04
Speaker
In influencer marketing, we basically work in the same business model as in partner marketing. So our brands, again, pay only for results that then have been triggered by influencers or creators compared to publishers' websites that we have in partner marketing. So brands working with us pay only for results. um The difference is that the network that we have created is a million of influencers and creators instead of publishers. Influencer marketing itself is the fastest growing digital marketing channel and we think that it has the potential to become one of the largest overall. TrayDoubler, it's quite sizable. It's around 30% of our total business. It has grown 50% last year. It will grow around 40% this year and we are quite comfortable that we can keep this traction. um So it's very, very important and very exciting as well for our brands.
Why is Trade Doubler focusing on M&A, and what is Appiness?
00:08:02
Speaker
And then finally, you've got a health cash position, your cash generative. What's your priorities for capital allocation? For example, is M&A on the agenda?
00:08:13
Speaker
Sure. So principally, we see ourselves being a quite comfortable situation as being profitable and generating cash, having a positive net cash position. that makes us independent and allows us to move. So we're constantly evaluating which steps we can do in order to push us forward on our growth ah agenda.
00:08:35
Speaker
M&A is certainly a topic that we're working on, either to expand our existing positioning in partner or influencer marketing or to add new relevant offers to our portfolio. like We did that with the acquisition of the mobile app business that helped us to establish Appiness, which is potentially the next rising star in our portfolio. So we are actively working on that.
00:08:57
Speaker
Matthias, a really good introduction to the business. Nice to see a business with a fundamentally solid cash generative platform with a number of of different growth growth vectors. Many thanks for joining us today.
00:09:09
Speaker
Thank you so much, Dan. Pleasure.