Blog Post

Outbrain said to be considering an IPO that could value it at $1B

Stay on Top of Enterprise Technology Trends

Get updates impacting your industry from our GigaOm Research Community
Join the Community!

If you’ve been to any one of a thousand different news websites, from CNN to US Weekly, you’ve probably seen a “suggested reading” or “recommended for you” section at the bottom with links to other sites — some of which are sponsored ads. In all likelihood, those links are powered by Outbrain, a New York-based company that is reportedly considering an IPO on the Nasdaq exchange that could value the business at about $1 billion, according to a report in the Wall Street Journal.

Quoting people “familiar with the matter,” the Journal reported earlier this week that Outbrain has filed a confidential prospectus with the Securities and Exchange Commission for an initial stock offering, and if approved it would go public early next year.

Outbrain, which currently has over 400 employees, was originally founded in Israel in 2006 by Yaron Galai, who sold a previous company called Quigo to AOL in 2007 for $365 million. Coincidentally, Outbrain’s main competitor when it comes to “recommended for you” sponsored links — a company called Taboola — was also founded in Israel and is now based in New York.

Outbrain has raised $100 million from a group of venture investors, and Taboola is reported to be looking at raising about the same amount in its own funding round. Although Outbrain doesn’t disclose its revenue, Taboola reported earlier this year that it has a 12-month “run rate” of about $250 million in revenue.

While they may be growing quickly, however, not everyone is enamored of their business model of showing viral “clickbait” in an attempt to drive traffic to publishers and/or advertisers. Venture capitalist Marc Andreessen said earlier this year on Twitter that “anyone serious who uses [a third-party related content module] should be shot.”

6 Responses to “Outbrain said to be considering an IPO that could value it at $1B”

  1. Connor Ryan

    Revolutionary business model… brilliant. Uses data science to serve up what’s truly “interesting” to the end user — not just what’s contextually relevant. This is good for publishers, advertisers — and, most importantly, end users. Think of it as an Ad Sense killer.

    • I have to disagree with you. Most of the suggestions put up by Outbrain are of the lowest common denominator sort. Complete clickbait, white trash, etc., content from sites that pay to be there and have nothing to do with the sites that most visitors are on. When I go to The Atlantic, I am not expecting some link for secret tricks about belly fat or some airhead celebrity without make-up.

      Yes, it is possible to train these systems over time, by deleting the suggestions one does not like, but even then there are usually sponsored articles that have nothing to do with the demographic or interest driving a visit to a site.

      • Andria Tay

        The Atlantic uses Taboola, not Outbrain, and therein lies a major difference btwn the services. Not that Outbrain never has trash in the feed, but they’re much more diligent about monitoring the content.

  2. I’ve experimented with Outbrain and I can only say “meh”. We got a few clicks, but the price was much too high. The problem is that I can’t get 1/100th of the click price from my advertisers. So it’s a losing game unless someone says, “Wow. This is a GREAT site, I’m coming back every day.” But they don’t do that. They just surf to whatever articles that their friends post on Facebook. There’s no feedback.