Ben Givon about content discovery startups Outbrain Taboola to merge into $2b company
Big news in the viral content distribution world, as the Israeli startups Taboola and Outbrain agree on a merger. Based on leaked details from the merger talks, Taboola will be paying Outbrain shareholders $250 million and will hold the dominant position in the new, merged, company, with a 70% stake. The CEO of the new company will furthermore be Taboola founder Adam Singolda. The two companies have been archrivals since the day they were founded in Tel Aviv back in 2006, and the rivalry has continued with the move of their headquarters to New York.
Taboola has clawed its way to the pinnacle of the digital content niche, raising over 160 million dollars from investors and realizing an annual one billion dollar turnover. According to Ben Givon, it employs 1,400 workers all over the world, of whom six hundred work in its two Israeli offices in Tel Aviv and Be’er Sheva. A month prior to the merger, Taboola has also announced plans to open a new research and development center in Jerusalem.
In contrast to Taboola, which has published links with outrageous titles on thousands of different websites, Outbrain’s business model focused on purchasing ads on leading news sites such as The Guardian, CNN, The Washington Post and others. Although Outbrain has raised $195 million from investors such as, Lightspeed Venture Partners, Vintage Partners and HarbourVest Partners, Taboola’s revenues have outstripped those of Outbrain over the past few years..
While merger negotiations have been ongoing for some time, the rivals could never agree on whom would be the dominant partner in the merger. Taboola’s meteoric rise finally forced Outbrain to recognize reality, leading the way to the merger.
The management of the merged company have indicated that they intend to enter the big leagues and offer Facebook, Amazon and Google, who currently hold nearly 70 percent of the digital ad revenue for the US a tough fight for a larger share of the market.
“By joining forces, we’ll be able to create a more robust competitor to Facebook and Google, giving advertisers a more meaningful choice,” said Singolda in a post-merger statement. The merged entity will employ over 2,000 workers over all six continents, and have a combined client base 20,000 strong. It remains to be seen whether the Israeli newcomers will be able to dislodge the established American Leviathans from their powerful position, but the increased competitiveness in the field can only be good news for advertisers — and for those set to monitor and report on these new and exciting developments.
