I am bullish on TTD. But a word of caution about that 700-1000B TAM. The TAM is limited by the walled gardens and I don’t see anything near time that will change that narrative. If you see the survey link…

2018 digital ad spend is $273B. FB, Google ad rev (TTM) is about $175B. AMZN said several billion in adv rev already and growing fast. Even Apple is estimated to have ad rev of 500M in their app platform and will get $2B by 2022. So, it is fair to assume that about 2/3rd of the global digital ad market is within walls. There is a reason why Jeff Green says China will be their #1 rev generator not USA because these companies don’t have much presence there. TTD estimates $464M in 2018 rev. Since their rev is 20% of the ad gross spend through their platform we can estimate gross spend in TTD platform of $2.3B for 2018 which is 2.5% market share of the total non walled garden ad space.

This survey shows digital ad spend growing at a CAGR of 12% (2018-22) to $427B. I assume connected TV is included in this. So, TTD’s growth rate is dependent on programmatic ad growing much faster than 12% and TTD themselves growing even faster than that (they have done that). This way they can get to a higher market share of the non walled garden space. Let us not forget also that FB has had substantial security issues this year. But FB is not going away. It has not even monetized whatsapp and fb messsenger. It is trying to monetize stories and videos. Amazon wants a bigger share too. So, will the walled garden stay at 2/3rds or will that grow even higher. Interesting space to watch no doubt.