Beehiiv’s Deal for an Ad Tech Startup Shows Strains on Founders

Let’s kick off this week with some creator economy M&A news. Beehiiv, a newsletter publishing startup, is acquiring Swapstack, an advertising marketplace for newsletters, Beehiiv’s CEO Tyler Denk confirmed to me. 

Beehiiv is acquiring the smaller firm’s tech and relationships with advertisers. Swapstack co-founder and CEO Jake Schonberger and a Swapstack account manager will join nearly two-year-old Beehiiv. They’ll help expand the ad network Beehiiv launched earlier this month to connect writers and publishers with sponsors for deals, according to Denk. 

“We are looking to build a large ad network and help profitable newsletters via ads,” Denk said. “The goal is to beef up the team.”

The deal, which the companies planned to announce this week, is not the one Swapstack founders had envisioned. The agreement essentially wipes out two-year-old Swapstack’s investors, just leaving it with enough capital to shut down, according to a letter Swapstack’s Schonberger, a former Facebook advertising employee, sent to its investors last week.