IPO Report: MaxPoint Interactive (MXPT)

Francis Gaskins |

MaxPoint Interactive IPO, MaxPoint Interactive IPO price, MaxPoint Interactive IPO date, stocks to buy now, IPOs this week, small-cap stocksMaxPoint Interactive (MXPT) provides a leading business intelligence and marketing automation software service, which MXPT refers to as its solution, that enables national brands to drive local, in-store sales. The company is based in Morrisville, NC,

No other companies are scheduled for the week of March 2, 2015. The full IPO calendar is available at IPO Premium.

SEC Documents

Manager, Joint-managers: Goldman Sachs, Deutsche Bank, and Pacific Crest.

MXPT scheduled a $75 million IPO with a market capitalization of $294 million at a price range midpoint of $11.50 for Friday, March 6, 2015 on NYSE.

MaxPoint Interactive IPO Summary

MXPT provides a leading business intelligence and marketing automation software service, which MXPT  refers to as its solution, that enables national brands to drive local, in-store sales.

National brands use MXPT’s MaxPoint Intelligence Platform to predict the most likely local buyers of a specific product at a particular retail location and then execute cross-channel digital marketing campaigns to reach these buyers.

MaxPoint Interactive IPO Valuation


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MaxPoint Interactive (MXPT)








MaxPoint Interactive IPO: Conclusion

Neutral slightly plus

·         Measures impact of digital campaigns for physical outlets

·         Focused on consumer products, retail and automotive.

·         Expanding into healthcare, telecommunications and entertainment

Rev top 25 customers +40%

Top 25 customer campaigns +55%

Top 25 customers % of total rev 49%, down from 56%

Rev +61%, 56% gross profit, -12% loss on rev

Price-to-sales, 2.8; P/E -23, Price-to-book 4.4

Traffic acq cost + sales & mkt, 78% of rev

MaxPoint Interactive Business

MXPT provides a leading business intelligence and marketing automation software service, which MXPT  refers to as its solution, that enables national brands to drive local, in-store sales.

National brands use MXPT’s MaxPoint Intelligence Platform to predict the most likely local buyers of a specific product at a particular retail location and then execute cross-channel digital marketing campaigns to reach these buyers.

Business intelligence is at the core of MXPT’s solution, which leverages high-velocity data processing and proprietary statistical models to continuously analyze more than 20 billion daily data attributes to delineate consumers' real-time purchase intent.

By identifying and reaching only the most likely local buyers with digital customized product offers for local stores, national brands can more efficiently and effectively run local marketing campaigns, thereby increasing in-store sales and reducing wasted marketing spend associated with traditional approaches.

Measure impact of digital marketing campaigns

National brands can then measure the offline sales impact of those digital marketing campaigns to optimize future campaigns and budgets and manage in-store supply levels.

MXPT introduced the MaxPoint Intelligence Platform in 2011 as a cloud-based service run primarily by MXPT on behalf of its customers.

Since 2013, MXPT’s customers have also had the ability to directly interface with the MaxPoint Intelligence Platform software service.

MaxPoint Interactive Growth plan

Historically, MXPT focused primarily on serving national brands in three industries: consumer products, retail and automotive.

MXPT recently expanded into three new industries: healthcare, telecommunications and entertainment.

MXPT's plan is to continue to penetrate these new industries and pursue opportunities in additional industries.

MaxPoint Interactive Recent innovation

One recent innovation has been MXPT's ability to purchase non-display advertisements through its  platform on behalf of customers, which was introduced in the fourth quarter of 2012.

Revenue from non-display advertisements has grown rapidly from 8% of revenue, or approximately $0.9 million, in the first quarter of 2013, to 23% of revenue, or approximately $8.8 million, in the fourth quarter of 2014.

Alternative to traditional local marketing methods

MXPT provides a technology-driven alternative to traditional local marketing methods for national brands across a number of industries where transactions take place predominantly offline, such as consumer products, retail, automotive, healthcare, telecommunications and entertainment.

The primary marketing methods traditionally utilized to engage local consumers are print media, direct mail and radio.

MXPT believes these methods have become outdated as media consumption moves online and national brands increasingly seek digital solutions to make effective local marketing decisions to drive in-store sales.

88% of retail purchases at physical locations

Approximately 88% of total U.S. retail purchases in 2014 occurred at physical locations, according to Euromonitor.

The challenges associated with the promotion of local, in-store purchasing include predicting a consumer's purchase intent and matching that consumer with the appropriate local store that currently has the desired product in stock.

MXPT believes these challenges are more pronounced for national brands because they generally operate on a centralized or regional basis, which limits their visibility into the purchase intent of local consumers.

MaxPoint Interactive Intelligence Platform

The MaxPoint Intelligence Platform is a cloud-based software service that enables national brands to predict local demand based on consumers' purchase power and intent and manage customized digital advertisements containing in-store offers and promotions to reach consumers at a local level across display, mobile, social and video channels.

The MaxPoint Intelligence Platform matches the most likely communities of local buyers with a specific product at a particular retail location within a given timeframe.

Through marketing automation and direct integration with real-time bidding, or RTB, exchanges, MXPT’s platform delivers customized digital advertisements containing product and store-specific promotions to local consumers.

MaxPoint Interactive Seasonality

In the advertising industry, companies commonly experience seasonal fluctuations in revenue.

For example, many advertisers allocate the largest portion of their budgets to the fourth quarter of the calendar year to coincide with increased holiday purchasing.

Historically, the fourth quarter of the year reflects the highest level of advertising activity, and the first quarter reflects the lowest level of such activity. MXPT expects revenue to continue to fluctuate based on seasonal factors that affect the advertising industry as a whole

MaxPoint Interactive Traffic Acquisition Costs

Traffic acquisition costs consists of media costs for advertising impressions MXPT purchases from Real Time Bidding (RTB) exchanges, which are expensed as incurred.

MXPT purchases impressions directly from these exchanges and typically pays them monthly for actual advertising impressions acquired.

Historically, MXPT has not committed to purchasing a defined volume of impressions from any of these exchanges.

MXPT anticipates traffic acquisition costs will increase in absolute dollars as revenue increases.

However, MXTB traffic acquisition costs will fluctuate on a quarterly basis due to the seasonality of the  business, experimentation with and refinement of real-time bidding platform, competition for impressions on RTB exchanges, the type of media inventory MXPT is purchasing and the types of campaigns we are implementing for our customers.

MaxPoint Interactive Intellectual Property

As of December 31, 2014, MXPT had three active U.S. patents and 18 pending non-provisional applications in the United States and five pending non-U.S. applications.

MXPT registers certain domain names, trademarks and service marks in the United States and in certain locations outside the United States. MXPT also relies upon common law protection for certain trademarks.

In addition, in the ordinary course of business, MXPT licenses third-party software, enter into third-party relationships and utilize "open source" software to create and distribute its solution.

MaxPoint Interactive Competition

MXPT’s principal competition includes traditional advertising and direct marketing companies, such as Gannett Company, Inc., The McClatchy Company, News America Marketing, Valassis Communications, Inc. and Valpak Direct Marketing Systems, Inc.

MaxPoint Interactive 5% shareholders pre-IPO

Joseph Epperson             10.9%

Len Jordan                         23.6%    

Augustus Tai      32.2%   

Trinity Ventures  32.2%

Madrona Venture Funds              23.6%                                                                   

MaxPoint Interactive Dividends

No dividends are planned.

MaxPoint Interactive IPO Use of Proceeds

MXPT expects to receive $66 million from its IPO and use it for the following:

for general corporate purposes, including working capital, sales and marketing activities, engineering initiatives including enhancement of MXPT’s solution, investment in technology and development and capital expenditures.

MXPT also may use a portion of the net proceeds from this offering to acquire or invest in technologies, solutions or businesses that complement its business, although MXPT has no present commitments, and MXPT has not allocated specific amounts of net proceeds, to complete any such transactions or plans.

Pending their use, MXPT plans to invest its net proceeds from this offering in short-term, interest-bearing, investment-grade securities.


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Symbol Name Price Change % Volume
MXPT MaxPoint Interactive Inc. 8.89 0.02 0.21 719


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