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Photo by Jaap Arriens/NurPhoto via Getty Images
IAC, the internet holding company chaired by media mogul Barry Diller, announced to shareholders on Tuesday that it plans to spin off video service Vimeo.
Why it matters: It's the second major company that IAC has spun off this year, having done so with dating company Match Group in July. The 15-year-old Vimeo started as a platform for indie filmmakers, and now mostly makes money selling enterprise video software to companies.
Details: The effort comes months after Vimeo raised $150 million from outside investors to boost the software licensing business that it launched in 2018. The enterprise software licensing business that has contributed to much of the company's growth was launched in 2019.
- The round valued Vimeo at $2.75 billion — 10 times the company's revenue.
- Vimeo now has over 3,500 enterprise customers, including Amazon, Starbucks. Deloitte, Zendesk, Rite Aid and Siemens, according to a statement about the spin-off.
The big picture: IAC's playbook is to grow companies within its holding group and spin them out for greater value when they mature. There have been reports that IAC also plans to spin out ANGI Homeservices, which houses Angie's List.
What they're saying: "The combination of Vimeo’s remarkable growth, solid leadership position, and enormous market opportunity have made clear its future," said Joey Levin, CEO of IAC. "It’s time for Vimeo to spread its wings and become a great independent public company."
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