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Related-Links Provider Outbrain Expands War Chest by $35 Million

Tech Suggests Further Reading on Publishers' Websites

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Related stories served up by Outbrain for The Daily Beast.
Related stories served up by Outbrain for The Daily Beast.

Investors are betting there's a lot of money in serving up links to related articles.

Outbrain CEO Yaron Galai said his content-recommendation startup still hasn't used most of the $11 million it raised in February, but that didn't stop it from raising a massive $35 million Series D round that it announced today, bringing total funding to $64 million. Index Ventures led the round.

"We didn't have any particular need to raise anything," Mr. Galai said. "But it's a really interesting war chest for us and we've shown in the past that when we have a good growth opportunity, we seize it."

Outbrain's publisher partners -- which have included USA Today, TMZ, and iVillage -- use Outbrain's technology in two ways. Some pay Outbrain on a per-click basis to place links to their articles next to articles on other sites. Outbrain's algorithm decides on which links to show based on "interestingness" first, and relevancy second, Mr. Galai said.

On the other side, you have publishers who get a cut of that revenue by allowing links to other publishers' stories to reside on their sites. Outbrain also has brand clients who pay to drive traffic to articles about their products or services on publishers' sites around the web.

Earlier this year Outbrain bought Surphace, an AOL-owned competitor, and expanded into Europe. Mr. Galai wouldn't say whether the company is lining up any future acquisitions, but said it's planning to expand further in Europe and in other markets.

Outbrain also plans to invest in a video-recommendation product and a mobile version of its service, Mr. Galai said.

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