Anonymous Banker's bleak view of the media M&A market
May 7, 2025
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In a revealing conversation, Anonymous Banker, an M&A advisor with specialized knowledge in digital media, offers keen insights into the current landscape of media acquisition. He categorizes buyers into three groups and explains why ad-supported sites are facing valuation drops. The discussion also delves into how AI is negatively impacting forecasting and the need for ROI-positive content within tight timelines. Other highlights include the durability of lead-generation models and the implications of major tech platforms dominating advertising revenue.
The media M&A landscape is shifting towards cash flow optimization, with new buyers focusing on programmatic revenue and minimal content investment.
AI is gaining traction within media organizations for operational improvements, though hesitance remains regarding its editorial application and integration.
Fragmentation in product leadership within media companies hampers effective responses to market changes, necessitating unified strategies for innovation and audience engagement.
Deep dives
Navigating the Shift to Product-Led Growth
Media companies are currently facing a significant transition from the traditional scale era to a product-led growth model. Many are struggling with this shift as they work to engage audiences amidst technological limitations and organizational silos. A recent survey indicated that a large portion of technology budgets is being spent on maintaining existing systems, leaving limited resources for innovative experimentation. This environment highlights the importance of revisiting strategies to prioritize audience engagement while overcoming internal constraints.
The Role of AI in Media Operations
Artificial intelligence is increasingly being utilized in media organizations to enhance workflows and assist in marketing and operations. However, there is still significant hesitance regarding its editorial use, with many companies wary of fully integrating AI into their content creation processes. This cautious approach could be detrimental, considering AI's potential as an assistive tool that can revolutionize media operations. Embracing AI might be crucial for improving efficiency and staying competitive in a rapidly evolving landscape.
Emerging Buyers in the Media M&A Market
The media merger and acquisition landscape is evolving, with new types of buyers emerging that differ from traditional strategic acquirers. These buyers often focus on cash flow optimization and rely heavily on programmatic advertising revenue. They are often described as 'harvesters', seeking to strip out inefficiencies and maximize profits with minimal investment in content creation. This trend reflects a shift towards a more fragmented and risk-averse market, where media assets are valued based on their ability to generate immediate returns.
Fragmented Product Leadership and Industry Challenges
Product leadership within media organizations often suffers from fragmentation, leading to conflicting priorities that impede progress. This fragmentation complicates the industry's ability to respond effectively to evolving market conditions and consumer demands. Recognizing the need for unified product strategies is essential for navigating the complex landscape of digital media. As companies grapple with challenges such as audience fragmentation and technological advancements, cohesive leadership can drive more effective decision-making and innovation.
Evolving Revenue Models in Media
The traditional model of media businesses relying on advertising revenue is undergoing considerable change, with many organizations exploring alternative revenue streams. This includes leveraging affiliate marketing, creating content for specialized audiences, and developing direct-to-consumer models. Audience engagement remains a critical driver of success, but the methods for achieving it are diversifying rapidly. As companies adapt, they are discovering new ways to monetize their content and connect with consumers, reflecting an ongoing transformation in the media landscape.
I spoke with Anonymous Banker, an M&A advisor with a front-row view into the market for buying and selling digital media companies. Needless to say, it’s a buyer’s market.
AB breaks down the market for digital publishing assets – broadly those with page-based models – into three types of buyers:
Harvesters
CAC jockeys
Vanity projects/rich person playthings
“If you're a publisher with a mostly ad-supported site, odds are your business will be worth less next year than it is now,” he said.
Deals are still getting done, but the buyers are different. These are no-name PE firms above ice cream shops in the outskirts of Miami. We go through the list, which ranges from Valnet to Static Media to Savage Ventures to Regent. The playbook is to buy undervalued media properties, slash costs, and milk the programmatic revenue with hyper-lean models that rudely dispense with the nostalgia of “when the going was good.”
“Any content they invest in has to be ROI positive within 30 days,” AB said. “You’ll never see them spend $20 million hoping advertisers show up. Those days are done.”
Other topics we covered:
How AI uncertainty is creating overhang that depresses valuations and makes long-term modeling nearly impossible
Why the most resilient media businesses are lead-generation machines or conversion front-ends
We debate whether the Chernin Group content-to-commerce thesis was wrong
How Substack’s recommendation engine is the most efficient user acquisition channel in media
What kinds of content investors still believe in (hint: high-intent verticals, not general news)
