Outbrain and Taboola, the leading providers of clickbait ads, are both raising funds through IPOs. Outbrain will raised at least $100m through a conventional IPO, while Taboola has just gone public by merging with a Special Purpose Acquisition Company (SPAC) on Nasdaq.
The 15-year-old Outbrain, which self-describes as “a content recommendation platform”, places “chumbox ads” on websites, to lure readers to other media sites. Its 2020 revenue was $767m ($4.4m net income). In the first quarter of 2021, it reported revenue of $228m (2020: $177m in 2020. It reportedly funnels ads to more than 7,000 web sites, paying brands like CNN and Le Monde whenever users click on them. It claims more than 20,000 advertisers.
Outbrain, which was founded by co-CEOs Yaron Galai and David Kostman, had agreed to merge with rival Taboola in 2019 but the deal fell through. Taboola began trading on the New York Stock Exchange this week at a valuation of $2.6bn. The IPO valuation of Outbrain, which launches on Nasdaq next week, is not yet known.
Taboola founder and CEO Adam Singolda distances his site from clickbait and talks of “an opportunity to transform the open web into a feed of recommendations. I think of Taboola as a search engine but in reverse. Taboola is providing (users) with recommendations for content and things they might like but just never knew existed.”
