Yahoo to Buy Premium Ad Network 5to1 for $28 Million

Yahoo will acquire 5to1, a premium ad network consolidating inventory from major media sites, for $28 million. The firm launched in 2009 as a way to ease brand marketers’ concerns about buying unsold inventory.

With a staff of eight and some very high-profile advisors, Los Angeles-based 5to1 works with “more than 20” premium publisher partners but does not disclose their names. That’s presumably to avoid channel conflict, which occurs when media buyers forego direct ad buys from posh sites in hopes of getting a better price through ad networks or exchanges.

Many of the firm’s founders, advisors, and investors have a history working for MySpace and other businesses within News Corp.’s Fox Interactive Media division – including CEO James Heckman and Chairman Ross Levinsohn.

Levinsohn, who ran FIM from 2005 to 2007, may have helped fuel negotiations between the two companies. After serving as president of FIM, Levinsohn joined Yahoo last fall as EVP of its Americas region – responsible for the U.S., Canada, Latin America, and South America. He was also a founder of Fuse Capital, an investor in 5to1, but divested when he joined Yahoo, according to AllThingsD, which first reported rumors of deal talks between the two companies.

But Levinsohn is not 5to1’s only significant connection to Yahoo. Among its advisors is Wenda Harris Millard, former head of global sales at Yahoo. Other advisors and investors include digital media hotshots Michael Kassan of Media Link; Quincy Smith, former head of digital at CBS; and Jason Hirschhorn, previously chief digital officer at MTV and chief product officer at MySpace.

Wayne Powers, Yahoo’s SVP of North American sales, said in a statement, “5to1 provides additional access to publishers and unlocks the value of unsold inventory for premium brand advertisers.”