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Video Ad Firm TubeMogul Files for $75 Million IPO

Profitless Company Has Yet to Crack $100 Million in Annual Revenue

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Hey Wall Street: another loss-making ad-tech company wants your money.

Video ad-tech company TubeMogul filed for a $75 million initial public offering on Wednesday, making itself the latest video ad company to test the public markets.

TubeMogul CEO Brett Wilson
TubeMogul CEO Brett Wilson

TubeMogul, based in Emeryville, Calif., is hoping it gets a better reception.

The track record over the past year is dismal: Tremor Video's stock has plunged by 50% since it went public last June. And YuMe's has fallen by 18% since its debut nearly eight months ago.

Tremor, YuMe and TubeMogul all have different strategies of going after the market, so comparisons aren't necessarily apt. For one thing, TubeMogul is a lot smaller. When Tremor Media and YuMe filed to go public last summer, both companies' were riding annual revenues in excess of $100 million, while TubeMogul remains in the eight-digit range. The company pulled in $57.2 million in revenue last year, a 67% rise from the previous year.

Move to automation
At the time of their IPOs, both Tremor and YuMe were derided for running ad network businesses that lean on sales teams to buy and sell ads. Each company has been trying to move away from manual sales in favor of computer-automated deals. If ad tech were the travel industry, these companies are trying to go from being booking agencies to becoming Kayak. So is TubeMogul.

Two-thirds of TubeMogul's revenues come from advertisers using the company's sales team to place ad buys on their behalf. The other third comes from a self-serve system that lets a media buyer place their own bids for ads sold through real-time auctions. That latter business is where TubeMogul is focusing its future.

Wall Street holds automated ad-buying tech companies in higher regard. Ad-retargeting firm Criteo has seen its stock increase by 30% since going public in October. At the time of its September debut, Rocket Fuel may have marked the most successful ad-tech IPO of 2013. Initially priced at $29 per share, its value immediately jumped to $59.95 closed today at $47.17 on the NASDAQ.

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