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Vicinity Media seeks African growth

Nicola Mawson
By Nicola Mawson, Contributor.
Johannesburg, 22 Jul 2014
Vicinity Media wants to take its location-based advertising technology international.
Vicinity Media wants to take its location-based advertising technology international.

Vicinity Media aims to expand into Africa and the UK on the back of a private equity investment that saw it being spun off by Johannesburg-based digital media company Business Positioning Systems (BPS).

The company also wants to increase its representation in Cape Town, and is targeting African growth through "key publisher partnerships in Nigeria, Kenya and Tanzania", says CEO Daryl van Arkel. He explains this will be followed by a "strategic" move into the UK through BPS, and then expansion into other emerging markets where its "publisher-led expansion plans make sense".

Vicinity Media recently received a capital investment from 4 Decades Capital, which is in the form of debentures, but can be converted to a 30% stake, notes Van Arkel. 4 Decades Capital, which was formed by former Rand Merchant Bank (RMB) CEO Mike Pfaff and CIO Derek Prout-Jones last year, currently has a broad investment mandate.

4 Decades Capital investment professional Prout-Jones says the company invested in Vicinity, because it likes the space it plays in and believes "the universe of digital advertising is rapidly expanding and, within this the prospects for reaching customers via their mobile handsets is perhaps the most attractive space to play in".

Vicinity provides advertising based on consumer profiles including physical location, search term, handset type, local weather conditions, demographics, time of day and day of the week.

Prout-Jones adds the "opportunity to develop a first-to-market location-based advertising product seemed to be a very exciting business model to back". He notes 4 Decades Capital also liked the shareholder base and management team.

Vicinity plans to use the investment to develop its technology so it can be scaled across emerging markets and attract the best people to its business development team in each territory, says Van Arkel.

COO Neil Clarence notes the "timing of the investment is perfect for us. We have seen a prolific growth in demand for relevant mobile advertising and this capital injection enables us to focus on adding names to our growing list of publishers and clients, and continually developing our tech platform".

"Location-based mobile advertising has been an emerging trend globally for a number of years, and we have been pioneering this space in South Africa over the past five," adds Van Arkel.

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