Vimeo Raises $150M, IAC Considers Spin-Off

Vimeo has secured $150 million in a new round of equity financing, as revealed alongside the financial results for the third quarter of its parent organization, IAC.

Joey Levin, CEO of IAC, communicated in a message to investors that the company is now considering a separation of Vimeo, making it independent for shareholders.

“Considering Vimeo’s achievements and the strong investor interest in Software-as-a-Service (SaaS) businesses, we anticipate that Vimeo will find raising capital more efficiently as a standalone entity than within IAC. This external access to funding will be instrumental in helping Vimeo reach its full potential,” Levin explained, also noting, “We recently evaluated Vimeo’s capacity to attract investment through a limited private funding round, which strengthened Vimeo’s financial position and allowed for a return of capital to IAC.”

Earlier this year, Match Group, the parent company of several dating platforms like Tinder, became an independent entity following a distribution of IAC ownership to its shareholders.

Vimeo has redefined its strategy in recent years, moving away from direct competition with YouTube as a platform for general video sharing. Instead, it now provides video solutions for businesses and organizations. A recent example of this is the introduction of Vimeo Record, a complimentary video messaging service.

The company reports having 1.5 million paying customers and a client base of over 3,500 enterprise-level organizations, including prominent names like Amazon, Starbucks, Deloitte, Zendesk, Rite Aid, and Siemens.

The latest investment was provided by Thrive Capital and GIC. The earnings report indicates that Vimeo’s revenue increased by 44% compared to the same period last year, reaching $75.1 million in the third quarter. Furthermore, the company achieved positive EBITDA for the first time, totaling $3.4 million.

“We are dedicated to making video creation and distribution significantly easier for businesses, offering tools that are more user-friendly and affordable than existing options,” stated Vimeo CEO Anjali Sud. “We are excited to leverage this new capital to fully capitalize on the substantial opportunities available with the comprehensive capabilities of the Vimeo platform.”