The Rubicon Project Inc., an online-advertising company that reaches more U.S. Web users than Google Inc. (GOOG:US)’s ad network, picked Morgan Stanley (MS:US) and Goldman Sachs Group Inc. to lead its initial public offering, according to people with knowledge of the plans.
Rubicon, based in Los Angeles, is aiming for a market debut next year, said the people, who asked not to be identified because the information hasn’t been disclosed.
While many newly public ad-technology companies have seen their share prices plunge, Rocket Fuel Inc.’s (FUEL:US) successful offering (FUEL:US) in September and the rally that followed Twitter Inc. (TWTR:US)’s IPO last month have instilled a renewed level of confidence. TubeMogul Inc., a maker of software for digital marketing, is also planning an IPO for next year, people with knowledge of the matter said.
Ben Billingsley, a spokesman for Rubicon, declined to comment. Michael DuVally, a spokesman at Goldman Sachs, and Mary Claire Delaney, a spokeswoman at Morgan Stanley, declined to comment on their banks’ roles in the Rubicon IPO.
Rubicon, whose technology automates the buying and selling of online promotions for marketers and publishers, topped $100 million in revenue three years ago and is profitable. Its network reached 96 percent of U.S. Internet users in October, compared with 95 percent for Google, according to ComScore Inc.
Founded in 2007 by Frank Addante, Rubicon has raised at least $60 million from investors including Clearstone Venture Partners and Mayfield Fund.
Rocket Fuel, a provider of technology to manage, run and evaluate online-ad campaigns, has jumped 68 percent since its IPO in September. Ad-tech companies that went public earlier this year have dropped, including video-ad network YuMe Inc. (YUME:US), which has declined 11 percent since debuting in August, and rival Tremor Video Inc., which has plunged 57 percent since its June IPO. Marin Software Inc. has fallen 30 percent since its March IPO.
Addante told Bloomberg News in August that he was holding off on an IPO until Rubicon’s numbers could impress Wall Street.
“Investors in general appreciate companies that are at scale, profitable, have high growth rates and are technology companies,” he said.
To contact the reporters on this story: Jonathan Erlichman in New York at firstname.lastname@example.org; Leslie Picker in New York at email@example.com; Ari Levy in San Francisco at firstname.lastname@example.org
To contact the editors responsible for this story: Pui-Wing Tam at email@example.com; Mohammed Hadi at firstname.lastname@example.org