Q: What does FXM do?
A: We create marketplace advantages for media buyers and sellers through innovative financial and payment technology solutions, eliminating $30+ billion in waste and inefficiencies across the digital media ecosystem by reducing financial and payment friction points across the media supply chain.
Q: Why was FxM founded?
A: FxM was founded out of direct marketplace experience, specifically around payment and working capital issues. Working capital is the lifeblood of many businesses, yet it’s even more critical in the advertising industry that has codified unique payment principles. These requirements often result in delayed payments, creating working capital issues and forcing supply chain participants to independently finance the same media dollar over and over, driving up costs, ultimately paid for by the advertisers. Differently from the Ad Tech Tax, which has been discussed at length in many forums (e.g. ANA, PWC, etc.), this ‘Ad Financing Tax’ has remained largely unseen by advertisers, undiscussed and unresolved, and yet generates about $30B+ of waste in the digital media supply chain. With FxM, these issues can now be addressed.
Q: Who is the FxM team?
A: FxM was founded by a group of adtech and finance veterans that built much of today’s digital media ecosystem. Our deep understanding of the ecosystem – technically and practically – allows FxM to develop innovative and tailor-made solutions that more traditional banks and factoring companies have never been able to integrate into the complex media supply chain.
Q: What is unique about FxM?
A: FxMs combines one-stop, competitive payment and financing solutions together with a two-sided, incentive marketplace, embedded directly into the existing media supply chain infrastructure. The result, a simple to execute, win-win solution for all participants.
Q: How does FxM work?
A: FxM integrates several financing and procurement approaches including Supply Chain Financing (SCF), Supply Source Rationalization (SSR), and Procure-to-Pay (P2P) to craft bespoke solutions based on each company’s cash flow needs, financial and sourcing priorities and their role in the media supply chain. In many cases, we leverage our access to 3rd party financing to create liquidity, remove friction points and improve cash flow for participating players.
Q: What is Supply Chain Financing (SCF)?
A: Supply Chain Financing is under-leveraged in the complex media supply chain. In general, SCF is a type of financing that allows companies (advertisers) to extend their payment terms, while making sure their suppliers (DSPs, SSPs, Pubs) are paid early. This improved liquidity enables participants to better manage their cash flow, have more flexibility with commercial terms, and ultimately increase their top line. More specifically, with SCF, account payables from advertisers can be used as collateral by FXM to accelerate payments to suppliers in exchange for discounts that are passed back to buyers with full transparency.
Q: What is FxM Supply Source Rationalization (SSR)?
A: Supply Source Rationalization is complementary to more traditional Supply Path Optimization (SPO) efforts used today in digital media. Whereas SPO is used to source the optimal path to purchase for each individual impression, SSR also helps consolidate media spend with fewer, best in class suppliers (e.g., SSPs, Pubs). The goal is to create stronger relationships with fewer suppliers, to gain better control over supply, improve lead times, and reduce costs. More specifically, FXMs platform auto directs/concentrates ad spend to participating/prioritized supply partners based on each brand's sourcing priorities, including available discounts, to get the lowest cost for the best KPI driving inventory.
Q: What is FxM Supply Chain Procure-to-Pay (P2P)?
A: FXM helps each participant improve their P2P operations, eliminating corresponding overhead by driving automation in the end-to-end process and ultimately raising the bar on compliance with stewardship requirements (e.g. reconciliations, proof of performance, price verification). This lowers costs and improves governance of the media supply chain, with an increasingly self-service and intuitive platform that streamlines P2P operations available over time.
Q: Will FxM impact my campaign performance?
A: Yes. By reducing the financing cost (“Ad Financing Tax”) of media and AdTech partners, the corresponding savings can be shared back also with advertisers. This will naturally improve the performance of the advertising campaigns (i.e. lower CPM leading to higher reach, at parity budget). At the same time, FxM will not influence the buying strategies and approach which is already taken care of by the existing AdTech stack (e.g. DSP, AdServer, etc.).
Q: Will I still get access to all media inventory?
A: Yes. FxM does not limit media inventory access since it focuses on the financial flow (to eliminate financial waste from the digital media supply chain). In the case of SCF+ (Supply Chain Financing and Supply Source Rationalization), FxM can help also reduce redundant and/or non approved supply sources that do not provide unique value and/or are not whitelisted, in full alignment with the media buying strategy, but with increased commercial value.
Q: Does FXM need to partner with every SSP and DSP in order for this to work well?
A: No, FxM can work with any AdTech and/or Media partners of choice of the advertiser. Of course, the more entities participate within the digital media supply chain, the easier it is to aggregate commercial benefits that are reflected in higher reduction of Ad Financing Tax and corresponding AdTech fees and Media CMPs
Q: How does FxM differ from direct deals?
A: FxM helps advertisers leverage the benefits of programmatic buying (audience targeting, cross-publisher frequency capping, aggregated reporting, etc.), without the financial waste connected to the long supply chain and diverse entities involved. While advertisers may prefer direct deals because they are cheaper (also because of the shorter payment chain vs. programmatic buying and more favorable financing conditions and consequent lower CPMs), FXM brings together the best of both worlds.
Q: Why would I use FxM to finance my media vs a bank? A factor?
A: For AdTech and Media companies, FxM offers an alternative financing source vs. lines of credit like ABL (asset backed lending) revolvers. While ABL revolvers are on-balance sheet financing sources (with strict covenants, impact on the debt position and costs dependent on the credit worthiness of the borrower), FxM offers off-balance sheet, supply chain financing (or factoring) solutions that leverage existing account receivables (banks accelerate payments), have less stringent covenants on no impact on the debt position. Today, traditional banks do not offer such solutions in the AdTech and Media space, due to the complexity of the supply chain (payments, reconciliations, etc.). FxM drives clarity on the above and partners with banks to offer such solutions.