How adtech’s cash flow crisis is killing the DSP - and why that means the entire ecosystem is at risk

Digital advertising - and especially programmatic - is at an inflection point. AI’s ability has now reached a level where it is genuinely transforming how the adtech industry works, as companies across the entire supply chain invest heavily in the space.

Microsoft pulled the plug on its DSP last year, claiming the traditional DSP model is no longer fit for purpose at a time when the industry is committing more resources and energy into developing and deploying conversational and agentic AI technology.

Yet AI isn’t the only thing threatening seismic shifts to the adtech industry as we move into 2026; another significant challenge is the cash flow gap created by the industry’s extended payment terms and delays.

It isn’t the most headline-grabbing of topics, and is often treated as an admin issue for the finance department to manage. But cash flow is the under-the-radar danger that is at risk of throttling the whole industry, and the demise of high-profile DSPs lays bare a business model failure that has left publishers and SSPs picking up the financial pieces. Liquidity issues radiate trouble across the whole industry that quickly becomes a problem for the entire supply chain.

Cash (not) flowing

Since the beginning, huge companies, including big tech players, large advertisers and their agencies, have been the source of the funds that flow down the programmatic advertising chain. But they make the most of their size advantage by dictating terms that often leave publishers and smaller adtech companies gasping for liquidity.

Historically, DPSs have kept the system running as essential intermediaries. This exposes them to particular risk from the cash flow gap. While they may only be paid by advertisers and agencies after 90 or 120 days, DSPs often need to settle up with SSPs within the month. And extended payment terms, however painful, are only part of a problem that is exacerbated by invoices that are paid later still, either due to commercial calculation at the top or cash flow problems further down.

This liquidity crisis increasingly undermines the entire programmatic advertising market. Built-in inequalities pinch smaller players, starving them of operating capital and the ability to invest in new products. The market inevitably consolidates around cash-rich giants. And, in the threat the crisis poses to DSPs, it plants a timebomb under the entire programmatic supply chain.

As Adotat’s recent white paper, The Liquidity Crisis in Ad Tech, makes clear, the cash flow gap has created “a precarious operating environment in which DSPs function more like short-term lenders than technology platforms”. When DSPs go down, the effects are seismic and extend both ways along the chain. MediaMath’s 2023 bankruptcy, for instance, left more than $125 million (£92.3m) in unpaid debts to over 200 partners.

Left unaddressed, this kind of liquidity problem only gets worse, particularly in difficult economic times. But still it is not commonly discussed. Creativity and finance don’t often sit at the same table, and most companies simply accept harsh payment terms as part of the cost of doing business. Meanwhile, the gap between the cash-strapped Davids and the wealthy Goliaths of the digital advertising world only gets wider, and the potential for large-scale meltdown becomes ever greater.

Liquidity as a lifeline

Besides repairing a system at risk of permanent rupture, what does faster capital actually unlock? When liquidity travels faster and efficiently through a supply chain, it creates innovation, momentum and greater spending power at all levels - a virtuous circle that stimulates the entire business and allows smart companies to benefit more quickly from the great work they do.

What can be done to bring about change? A good first start is to bring greater transparency to the issue. We need to talk more openly about the scale of the problem and develop a blueprint for keeping the ecosystem alive through sustainable financial models, liquidity solutions and trust-based relationships. Perhaps we even need to shine a light on persistent late payers and allow smaller companies to make an informed judgement about who they do business with.

Regardless, the market needs liquidity to function, scale and drive growth. Revving has been sounding the alarm on this crisis for some time. Developed specifically for this industry, Revving’s Transaction-Based Funding (TBF) is ready to solve the digital economy’s liquidity problem - by integrating directly with your platforms and capturing transaction data to provide immediate access to funding. 

A company might not be able to force its creditors to pay faster, but if it can access cash in the meantime, it can invest, capitalise on opportunities and grow its business.

The DSPs, the publishers, the affiliates, the intermediaries who are under threat - these are the lifeblood of the industry. It is up to us to decide whether enough is enough, or risk sleepwalking into a gathering crisis that could bring down our entire ecosystem.