This morning we announced the closing of our seed financing by LGiLab (www.lgilab.com), GlenRock Israel (www.grg.co.il), and Sigma PCM (www.sigma-pcm.co.il) among others. We wrote about this on the corp blog, and more coverage is on Mashable, TheMarker (Hebrew only), alarm:clock, Ouriel’s blog and StartupIsrael.
One of the reporters talking to me this week asked/hinted at outbrain being a bubble company founded with the intention to flip it to a Yahoo or Google in a few months. As I’m allergic to that notion of ‘build-to-flip’, I thought I’d share some highlights of my email response here:
I know this probably sounds to you like a Bubble2.0 thing, but –
My track record has been in building a long-term, sustainable, revenue-generating and independent company. That is the *ONLY* model I am aware of for building a company. I don’t think there is such a thing at all to ‘build a company in order to sell it’. The companies that are sold (or – flipped) are the very few that happened to luck out. Statistically I think you probably have better chances of beating a Vegas casino than you would in selling a company that was built to flip (and Vegas is much more fun than the blood, sweat & tears of entrepreneurship!!… 😉
I think it’s foolish to start a company without a clear path to making $$. Given my experience in building one of the only contextual ad networks in the world that’s successfully competing with Google AdSense, I (and my investors) have a lot of confidence in our ability to monetize the outbrain service when the time is right. We all felt that focusing on that part of the business now would be a distraction, and I think our community members will agree.
Feel free to take the angle that will interest your readers, but you should just understand that my approach to building companies is very very very different from that of a 1st-time entrepreneur who’s dazzled from acquisition like those that Flickr or del.icio.us had, and is starting a company that will be built with $50K and sold to Yahoo within a year for $10M. All that stuff is completely not in our lexicon… 😉