Glam Said to Plan Second-Quarter IPO as Ads Aimed at Women Surge

May Join Parade of Web IPOs as Market Rebounds from Lull

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Glam Media CEO Samir Arora
Glam Media CEO Samir Arora

Glam Media, a startup that helps advertisers target women online, may join the parade of internet companies pursuing an initial public offering as the market rebounds from a lull earlier this year.

The Brisbane, Calif., company plans to file for an IPO by the end of the second quarter, three people with knowledge of the matter said this week. Glam is considering Goldman Sachs or Morgan Stanley to lead the offering, said the people, who asked not to be identified because the deliberations are private.

Glam, founded in 2004, has benefited from advertisers' willingness to pay higher rates to reach specific audiences, including female shoppers. The company's clients include Nike , Walt Disney Co.'s ABC network and Limited Brands ' Victoria's Secret. Glam is affiliated with more than 2,500 web publishers, which run the ads.

"There's a lot of pressure on advertisers to improve their return on advertising spending," said Karsten Weide, an analyst at IDC in San Mateo, Calif. The easy way to do that is to find an ad network with a preselected audience, he said. "Instead of going on a general network, you can go into Glam and target women," Mr. Weide said.

The company has already completed a "bake-off" with IPO bankers, where the firms compete for the deal, according to the people familiar with the matter. Glam is now close to hiring the underwriters, which may include Bank of America Corp., they said. Paul Loeffler, a spokesman for Glam, declined to comment, as did representatives from Morgan Stanley, Goldman Sachs and Bank of America .

Glam places ads on the websites of its partners and shares half the resulting revenue. The service helps independent publishers pay for the cost of producing content, said Vikrant Mathur, co-founder of the culinary website in Menlo Park, Calif.

"Glam has helped us ramp up on our revenue model," Mr. Mathur said. His company shows free content, such as videos of recipe preparations and cooking tips, and supports it with ads.

Though Mr. Mathur tried other ad services, including Google Inc.'s AdSense, Glam brought his site big-name advertisers such as L'Oreal and Kraft Foods. They tend to pay higher prices, he said.

"One of the most important things for us is the ability to be able to command higher premiums," Mr. Mathur said.

The market for IPOs has shaken off a slump, which was triggered by stock-market volatility and the European credit crisis. About 10 companies, including social-game developer Zynga and clothing company Michael Kors Holdings, are holding U.S. IPOs this week alone.

In September, Glam named Jeanne Seeley as its chief financial officer, adding an executive with experience at publicly traded companies including Apple . She also oversaw a preliminary IPO filing at Snap Appliance.

That same month, Glam announced plans to acquire social-networking site Ning and added Ning co-founder Marc Andreessen to its board. Bloomberg LP, the parent company of Bloomberg News, is an investor in Andreessen's venture-capital firm, Andreessen Horowitz.

Glam bought Ning for about $150 million, two people familiar with the matter said when the purchase was announced. The company is boosting the size of the deals it considers, and acquisitions will be as big a part of Glam's expansion as internal growth, CEO Samir Arora said in September.

An IPO will provide Glam more capital to compete in online ads, a field that may require the company to invest in video, ad exchanges and real-time bidding, said Mr. Weide, the IDC analyst.

"Partaking in all of these hot trends means partaking in software development, and software development is expensive," he said.

-- Bloomberg News --

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