The new deal with the Ontario Teachers’ Pension Plan, intended to raise StackAdapt’s awareness in advance of going public in the coming years, comes at a critical juncture. StackAdapt co-founders Yang Han (left), CTO, and Vitaly Pecherskiy, CEO, at Invest Ottawa, on Feb. 3.Ashley Fraser/The Globe and Mail
Finding anyone to back StackAdapt Inc. was tough. Its three twentysomething co-founders barely knew each other when they started the company in 2013. They had little startup experience and they were building advertising technology in an established market. “Reflecting back, would I have invested in us? I don’t know,” chief executive officer and co-founder Vitaly Pecherskiy said.
The trio scraped together less than $5-million from three investors early on. It wasn’t much. But it was all the scrappy founders needed to fuel one of the most impressive growth spurts in Canadian technology. Now the 1,300 person Toronto company is set to take its place among Canada’s startup elite.
co-led by former Canada Pension Plan Investment Board CEO Mark Machin, after raising US$300-million so far for its inaugural fund. The syndicate is buying most of its stake from existing investors, marking the latest in a string of large secondary stock deals involving private tech companies. The deal values StackAdapt at roughly US$2.5-billion.
“They’ve consistently demonstrated profitable, capital-efficient growth and have reached a substantial scale,” said Olivia Steedman, executive managing director with Teachers’ Venture Growth, which backs emerging tech giants worldwide. “When we see those factors, we get excited.”
StackAdapt is expected to surpass US$500-million in revenue and US$125-million in operating earnings in 2025, making it one of Canada’s largest and most profitable private tech companies. It has even paid millions in dividends. It did all of that quietly; StackAdapt didn’t even announce when private equity firm Summit Partners bought a US$300-million stake in a 2022 secondary deal, valuing the company at more than US$1-billion.
recent investigation by The Globe and Mail found 71 private companies have reached US$100-million in annual revenue, including StackAdapt, which generated nearly US$400-million in 2024.
tariff war with the United States as the kind of digital growth engine that tech sector advocates have long said Canada needs in order to lessen its reliance on the trade of physical goods. “Its success should be a terrific boost to Canada’s technology and innovation sector at arguably a difficult time,” Mr. Machin said. “The more companies we have like Shopify and StackAdapt, the wealthier the ecosystem becomes and there will be more entrepreneurs that have the capacity to stay and build.”
StackAdapt operates a demand-side advertising platform (DSP) that agencies and brands use to place ads on websites and digital channels. Mr. Pecherskiy and original CEO Ildar Shar, both Russian immigrants, came up with the idea while working for advertising multinational WPP PLC in Toronto. They hated the “super clunky and slow” platforms they used to place ads and felt they could make a better alternative, said Mr. Pecherskiy, who now lives in the Ottawa area. “We were building a product for our former selves.”
The founders teamed up with computer scientist Yang Han, now StackAdapt’s chief technology officer, who had built trading software for Bloomberg LP. Together, they built a platform that incorporated machine learning and artificial intelligence when that approach was new to adtech.
They focused on native advertising, a nascent area that allowed for ads to blend in with their surroundings on web properties, unlike easily ignored banner ads. To win over early customers, they initially promised advertisers would only pay when visitors engaged with content, not just when users clicked through.
StackAdapt gained traction with small agencies and brands. Within a year of launching in spring 2014, the company generated $1-million in revenue and consistently met its objectives as it expanded its platform.
That impressed Matthew Leibowitz, managing director of Toronto’s Plaza Ventures, who decided to invest. “Adtech wasn’t exactly the sexiest industry but it has one of the largest total addressable markets in the world. The company was growing rapidly, they had strong unit economics and, with the right execution, I thought it could be a force of nature,” he said.
But Mr. Leibowitz couldn’t convince others. The space was competitive (DSP specialists the Trade Desk, Criteo SA and Simpli.fi, and tech giants such as Google and Amazon.com Inc. are big DSP players) and many adtech startups had died. “I brought it to a dozen friends. Everyone passed,” he said. Plaza invested $1-million in 2016 and more in subsequent years.
Customers consistently rank StackAdapt the best DSP, according to market tracking site G2. And the company capitalized on industry shifts as streaming services and smart TVs, digital billboards, podcasts and online games ate into the dominant flow of web traffic that went to closed platforms such as Facebook and Google, which guarded user data they collected.
Now, players on the so-called “open internet” have a better handle on who visits their sites – and StackAdapt has become a key tool for advertisers to plan and place ads based on data derived from AI. The company has also recently introduced the ability for customers to create ads on its platform, unlike competitors that are primarily content distributors.
Meanwhile, the handful of investors that backed StackAdapt early on have profited richly: Plaza and MaRS Investment Accelerator Fund have generated some of the strongest returns ever by Canadian funds thanks to their StackAdapt bets: Both have cashed out an estimated 100 times or more their original investment in StackAdapt – and continue to hold shares worth vastly more than what they put in.
It’s one of several lucrative investments for Plaza, which has backed four other Canadian US$100-million-revenue club members (Super, Miovision Technologies Inc., Neo Financial Technologies Inc. and Site 20/20). Asked about the low-profile fund manager’s success, Mr. Leibowitz said only: “I like to celebrate my companies, not me.”
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