Demand's Rosenblatt in IPO and M&A Spotlight
This seems to have been a busy week for Demand Media CEO and founder Richard Rosenblatt (pictured here), with news of a big-banker hiring in a pending IPO of his social media start-up and the possible sale of a digital marketing company where he serves as chairman.
Indeed, Demand has hired Goldman Sachs (GS) to prep its initial public offering, sources told BoomTown, which the company is expected to file in August at a valuation of about $1.5 billion.
This confirms an earlier report in the Financial Times.
The price has to be high, given that Rosenblatt has managed to raise an eye-popping $355 million from a slate of high-profile backers, including Goldman Sachs, Oak Investment Partners and well-known media investor Gordon Crawford.
Rosenblatt essentially signaled his intent to move to the public markets with the recent nabbing of high-profile advertising exec Joanne Bradford from Yahoo (YHOO).
Her job: To quickly turbocharge Demand’s business as chief revenue officer. The company now does about $250 million in annual revenue, mostly from advertising.
Rosenblatt, who was part of the team that sold MySpace to News Corp. (NWS) for $650 million, could also be about to score another big-time sale.
This time, it is digital marketing firm iCrossing, sources said, in a deal with media giant Hearst Corp., which could close in the next two weeks, if all goes well.
First reported in The Wall Street Journal, the price for the large Scottsdale, Ariz.-based firm is hovering at about $375 million.
Not coincidentally, with Rosenblatt in common, iCrossing shares investors with Demand, including Goldman Sachs and Oak.
Here’s hoping Rosenblatt will be able to talk about all this and more in an onstage interview at the eighth D: All Things Digital conference this June.
He will appear in a session at D8 with former Wall Street Journal editor Paul Steiger, who is trying to save investigative journalism at a nonprofit called ProPublica.
The less lofty content created by Demand and others, such as AOL (AOL), using algorithms and other means, has attracted controversy, with worries about its impact on the traditional media business.