Ad tech company CtrlShift Singapore is pressing pause on its operations. In a statement to Marketing, co-founders Reza Behnam, Rene Menezes and Pete Yoong said CtrlShift's enterprise programmatic ad platform The Hub, had a promising future as a game-changer but the COVID-19 pandemic hit and "the bottom fell out".
"As with many businesses across almost all industries, the lockdown of almost every market around the world meant that many of our clients were put in a pretty precarious position and took a more conservative approach to spending," the founders explained.
They added that the effect of COVID-19 and the delay in client payments made things difficult for the agency. "After three consecutive months of this pattern, it became evident that we did not have the bullets to keep marching on with our self-serve technology business," they added. This was unfortunately amplified given the team was expecting funds as a result of a binding contractual agreement, and the funds were crucial to its ongoing operations.
"These fund were unfortunately not provided by the responsible party. This action stripped us of the funds we were counting on to afford us a runway, especially during, what later turned out to be, the COVID period," the co-founders explained. They added that they are now actively entertaining and discussing offers from third parties for The Hub.
"As we find an appropriate home for the platform business, we remember at our launch back in 2014, that we declared we had set out to create an Asia-focused digital marketing platform that understands and simplifies the complex task of executing digital initiatives across markets, channels and languages," they said. The founders offered their deepest gratitude to the team of more than 200 employees, alumni members and investors of CtrlShift who have given and continue to give it their all during their time with the firm.
In a phone interview with Marketing, Behnam explained that the decision to pause operations occurred around June/July this year. During the first and second quarters of 2020, the company was transparent with its employees about its financial situation. As of the first quarter this year, CtrlShift had approximately 15 to 20 employees and worked with between 40 to 100 clients. Most of its employees were encouraged to find new opportunities and many have since left, including former CEO Dominic Powers who recently joined Dentsu Aegis Network. It clients and shareholders were also informed of the decision to pause operations.
"As CEO, Powers communicated with them a number of months prior [to the decision to pause operations] and we took on a family approach to dealing with the challenges and ensuring people landed in good spots," Behnam said.
Behnam explained that most of its staff in Malaysia, Thailand and the Philippines were mainly overseeing The Studio, a programmatic advertising and marketing solutions company which had its majority stake acquired by marketing solutions company adGeek Group last year. The Studio, however, folded operations in those markets in May this year as it was impacted by the decrease in spending by major clients in 2019. Among the list of clients The Studio worked with included Nespresso, Boh Plantations, Siam Makro, SKY Cable and OPPO. Meanwhile in March this year, Serm Teck Choon stepped down as country head of CtrlShift Malaysia. Behnam said his departure is unrelated to the current development at CtrlShift.
That said, Behnam told Marketing that approximately six to eight individuals are still working on The Hub on a part-time basis as a passion project, most of who are director-level and above. "We have about six to eight individuals who are passionate about it and are working on a part-time basis. If an acquisition were to take place, they would be taking a serious look at it," he added. Despite the uphill battle, Behnam said CtrlShift has been receiving plenty of love from its clients, with many of them asking when it will restart operations.
CtrlShift Singapore is under CtrlShift Holdings, which also counts Asia Digital Ventures (ADV) as one of its entities, as well as The Studio before adGeek acquired a controlling stake. According to Behnam, ADV is still operating and was not impacted as much by COVID-19. ADV is the authorised exclusive distributor of Sizmek Technologies. Sizmek sold its Sizmek Ad Server and Sizmek Dynamic Creative Optimisation to Amazon last May.
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