Vimeo Raises $150 Million From Thrive Capital and GIC
In a letter to shareholders, Joey Levin the CEO of Vimeo’s parent company IAC said the company has “begun contemplating spinning Vimeo off to our shareholders.”
IAC has a track record of acting as an incubator spinning out stand alone companies. IN the past IAC has launched and spun off ten companies including Expedia, and more recently Match Group.
Vimeo’s net income for Q3 was $184.9 million, up from $16.5 million, last year. While Vimeo started as a YouTube competitor, the firm now makes most of it’s money from software as a service related to video distribution.
While brands may hire agencies for YouTube management to grow on the platform, Vimeo is much less a social network and advertising platform than YouTube. Vimeo is often used as a CDN offering hosting, transcoding and streaming capabilities within video. Vimeo’s list of video production tools are used by customers including Starbucks, GoDaddy, Amazon and Siemens.
“For several years now, we’ve espoused our belief that every business needs video to communicate, both internally and externally,” Levin said in the shareholder letter. “The lockdowns not only accelerated that necessity by a few years, but also expanded even our own lofty estimates of the size of our addressable market — and I don’t expect we’ll ever go back.”
The firms spin off could be win for investors, and Vimeo’s existence is clearly good for brands and consumers.