Now that Tumblr has been acquired by Yahoo, people are wondering what the next big New York IPO might be, and many fingers are pointing at AppNexus, the online ad platform based in the Flatiron district.
We talked to CEO Brian O’Kelley recently and he told us that wasn’t planning, or not planning, an IPO. He was focused on building a “truly great company.”
Right now, it’s certainly a truly big company: AppNexus has grown to about 500 employees, more than all but the largest traditional ad agencies on Madison Avenue.
The company has taken $141 million in funding (Microsoft is both a client and an investor). It is valued at $750 million, according to Crain’s New York Business. It has one of the biggest ad clients gettable: WPP, the ad agency holding company. O’Kelley declined to describe his revenues.
The investors would be disappointed if we weren’t a multibillion-dollar exit for them.
That was enough for the Post to say, unsourced, that “AppNexus is aiming to hit a milestone the city has yet to reach: a $1 billion IPO for a venture-backed company.”
But note that O’Kelley didn’t say “IPO.” As the Tumblr deal shows, it can be a lot easier and quicker to sell privately than to go public. Facebook’s drubbing in the marketplace has given a lot of founders a sour taste over the time and negative publicity that must be endured to float stock.
It’s true that big things are expected from AppNexus in terms of exit deals. The Guardian noted recently:
Roger Ehrenberg, a venture capitalist with IA ventures who sat on the board of TweetDeck, said other New York companies could be in line for a large acquisition, even though not all of them have names as immediately familiar as Tumblr’s. “I’d say AppNexus is likely the next $1bn-plus NYC company,” he said, including either an initial public offering or a sale.
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