Sramana Mitra: The publishers are paying a lot more than $10 a month.
Yaron Galai: We kept it, initially, at $10 a month but it couldn’t sustain them that way. The publishers said, “If you let us pay on a per-click basis, then we know exactly how many audience we get.” We pivoted on the pricing model as well. That all started working and going up. For the next couple of years, 100% of our revenues were from publishers.
Sramana Mitra: What scale did that reach with just publishers?
Yaron Galai: Probably closer to $10 million.
Sramana Mitra: The publisher model was successful enough that you were able to get to $10 million on revenue.
Yaron Galai: Yes.
Sramana Mitra: By this time, you had other investors involved? At what point did you bring in VCs?
Yaron Galai: We brought VCs pretty early on. I had VCs with me since 2008. We did a round about every year and a half or so. About two years after this whole saga, the brands that we spoke with earlier started coming back to us. That’s where we started our brand business. Now, it’s the majority of our business. It’s all came around. I guess we were a bit too early there in hindsight.
Sramana Mitra: What scale are you at right now?
Yaron Galai: We are in the hundreds of millions of dollars.
Sramana Mitra: What’s the game plan? Are you planning to go public sometime soon?
Yaron Galai: We’re invented the space and also reinvented it along the way in terms of how we define it and how companies play in the space. I think content recommendations is a big meaningful space just like search engines are. We are looking to keep growing this independently. So far, we’ve done just private financing. We just announced closing of the round a few weeks ago.
Sramana Mitra: What is the total amount of money you’ve raised?
Yaron Galai: It’s about $150 million.
Sramana Mitra: That’s across five rounds of financing?
Yaron Galai: Something like that. I don’t remember exactly.
Sramana Mitra: Would you want to continue to stay private?
Yaron Galai: Right now, the market is not great for going public so I don’t think that question is something we stress over these days. You need a good market to go out. We’re at a size and the market is certainly at a size where leaders would merit going public. I don’t know of a real space where that has been created where the leaders are not public companies. We’re certainly looking at it. We hired a CSO a couple of years ago.
Sramana Mitra: The thing that is going on in the market right now is that the incumbents are all looking for growth and new growth areas. I’m sure Google and Facebook are going to be interested in also acquiring growth market leaders. I guess there’s never a complete no possibility of not going public and getting acquired instead, right?
Yaron Galai: That’s a always a possibility. To quote Khosla, “An acquisition can be a fantastic outcome, but it’s a terrible plan.” I’m a big believer of that, so it’s never a plan. One of the obvious ways to build an independent company is by going public.