Now that Feedburner Story….

15 Comments

Every so often we hear about Chicago-based FeedBurner, the RSS remixer/syndicator is getting bought by someone. This morning, Sam Sethi pointed out that Feedburner was in talks with Google. Valleywag says they have a confirmation and the price range is in the $100 million ballpark. Is it true?

I am not sure – because last year FeedBurner was linked to AOL, a deal that almost happened but it didn’t! Will it happen this time around? Google declined to comment on the rumor. FeedBurner guys are being impolite and not calling back.

Now if the deal does happen – not that I have any first hand knowledge – it would at least get Google extend its AdSense platform to RSS feeds, one part of the digital media business where they failed.

So, why would Google pay such a high multiple, about 10 times revenues, for the startup? Probably, for the same reason it has developed Google Analytics: it is another way for Google to tie in independent online publishers. [Valleywag]

This would be part of a trend that is likely to continue for a while. I was speaking with Glover Lawrence, a veteran investment banker from McNamee Lawrence & Co., and he pointed out that while big buyouts like the $6 billion Microsoft-aQuantive deal might get all the attention, there is a lot of action in the smaller deals. Lawrence pointed out that future advertising-related deals would be around filling out technology holes or start-ups that have an area of specialization.

From a valuation standpoint the $100 million number being thrown around by Valleywag seems like a reasonable guess: FeedBurner has raised in excess of $17 million.

How does it impact the customers like myself? It was ok for a start-up like FeedBurner to sell ads on my RSS content, but with Google I am not too sure. I am getting increasingly dissatisfied about Google’s cut of the ad-dollars on our content. In fact, the best way for Yahoo and Microsoft to mess with Google’s AdSense business: match publisher’s AdSense check from say last month for three months, give publishers more share of the gold and be absolutely transparent about how much cut they are keeping. And gurantee that!

15 Comments

Alaskan Carnivore

Om

re: “and one hopes they be more transparent on”

I fully agree..

For instance, one of my media clients was using AdSense before the IPO, during and after..

Up until the IPO they were pulling in some VERY exciting coin with the GOOG adSense code installed..

Shortly after the IPO their (publishers) revenue went down about 700%. Same code, same account…

The real evis v. noevil question could be ‘was the buzz in the news rooms about GOOG hotter before the IPO than after’?

Om Malik

JimmyC

if google was keeping me in business, then i might be coming over and asking you and every reader for a free meal.

no one is doubting what google has done, but they didn’t keep it through the goodness of their heart. they make money too. it is a symbiotic relationship, and one hopes they be more transparent on who much cut they are keeping and what we are getting.

JimmyC

Without Google…the web would cease to exist as we know it today. Goodbye 10,000 blogs and Om, you can go back to working full time for Time Warner. The aggregate payout Google makes to AdSense partners is available every quarter and the numbers are staggering. Online advertising agencies and bloggers have real businesses now thanks to the evil empire. 8 months ago you all loved Google. Now it’s an evil empire. People are fickle and greedy.

Venture Itch

AdSense is like democracy – not perhaps an ideal system, but most definitely the best one available. I completely agree with you – Google abuses patience of publishers by cutting down their share of revenues, just because other alternatives are even worse.

Alaskan Carnivore

DoubleClick already powers RSS/XML ads. Washingtonpost.com has been using them to do so for a few years now.

Google of course now owns them..

Must be something else going on…

Marc LaFountain

I have no idea if this is true or not. If it is, great for the FeedBurner folks. They provide an awesome product the keeps getting better and is well supported. They deserve to make their millions. I also think that AdWords and FeedBurner could be a potent combination.

Is FeedBurner really still burning through VC dollars? Between ad sales and pro features, I would think they would at least be breaking even by now. If not, perhaps Google’s ad experience can turn that around.

Marc :-)

Klaus Kohlert

Feedburner is worth much more if they go it alone and IPO in a few years. They have a unique position in the market and no real compeditor.

and be absolutely transparent about how much cut they are keeping.

most important

matthew

all the bloggers that i know tell me that their rss ads generate negligable revenue. in fact, if ads in feeds were generating substantial revenue, we would have seen supporting facts and figures by now. feedburner is fully mature and still burning vc dollars. google isn’t dumb.

Marshall Kirkpatrick

I think this would be way awesome for Feedburner – the company has done a great job landing large and small publishers. I also wonder what this could mean for our local Portland competitor Pheedo. Hmmm…

curmudgeonly troll

make that FeedBurner VC Fred Wilson LOL

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