Taboola Raises $117M As Content Marketing Engines Battle For Supremacy

Taboola fundingTaboola has raised $117 million to fuel its turf war against chief rival Outbrain and smaller competitors.

The money will support the company's global expansion, product development and future acquisitions during a period when content recommendation companies are paying large sums for exclusive publisher deals.

Fidelity Management and Research Company led the round, which brings Taboola’s total funding to $157 million. There are also some notable “strategic investors” on the publisher side, including Advance (parent of Condé Nast and Advance Digital), Comcast Ventures, Yahoo Japan and the chairman of Italian publishing company Gruppo Editoriale L’Espresso.

According to CEO Adam Singolda, the money will accelerate growth for the company, which has posted profits for the past six quarters.

Competition has been heating up in the content recommendation space. In September 2013, Outbrain raised $35 million for a total of $99 million. The two companies now have similar capital behind them, with similar reported valuations of about $1 billion each.

And the two have vied for publisher contracts, in some cases making large revenue guarantees to lock in multiyear contracts. Outbrain in November signed a deal with Time Inc. reportedly worth $100 million over three years.

As the horse race continues between the market's front-runners, new entrants are livening up the field. Yahoo Recommends launched last year, and AOL-owned Gravity is using The Huffington Post as a launch point.

Singolda sees this competition as a sign of overall market expansion, comparing Taboola’s product to the other native content, like sponsored posts on Facebook. His ultimate goal is to emulate search, which likewise mixes paid results with organic ones. “This means it will become a new category that will last a long time,” Singolda said.

The Wall Street Journal reported last year that Taboola was raising money with an eye toward a public offering, but Singolda shrugged off talk of IPOs.

“When it comes to IPO, we don’t rule out anything, but we chose to take a large private round,” he said.

Taboola is looking to new regions for growth, including Asia and Europe. Its product goals include better personalization on the publisher side.

“The next generation of personalization will be to learn about different contexts of consumption and create different experiences to best drive monetization,” Singolda said.

As the idea of native programmatic takes shape, Singolda said he is unsure whether Taboola will remain a closed ecosystem or open itself to demand from native-enabled DSPs. “We’re thinking about options,” he said.

Its acquisition of Perfect Market last year was designed to take a step in that direction, toward being a “real-time advertising platform,” Singolda said. “We think the more we invest in technology, the more revenue we’ll be able to drive.”

 

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