French personalised retargeting business Criteo, has filed a preliminary prospectus for its initial public offering – in the US.
The 2005-founded firm, which delivers relevant and personalised ads in real-time, made the filing to the US Securities and Exchange Commission (SEC) today (Wed). It aims to raise up to $190 million in a listing in the US, over the next few weeks.
Many may wonder why Criteo, which has customers such as Expedia and Orange, has registered in the US, instead of closer to home.
PerformanceIN understands that there are two reasons why a company might favour the US to Europe for its public listing. The company may simply not meet the requirements of its home country, or it simply believes it will have better access to capital on the chosen exchange abroad.
‘A Major Step’
On the company’s filing to SEC it says that while it is incorporated in France, and a majority of its outstanding securities are owned by non-US residents, under the rules of the US SEC, it is currently eligible for treatment as a ‘foreign private issuer’.
When asked for a statement on the news, Criteo only confirmed that it has taken ‘a major step towards becoming a public company’, by filing its registration statement with SEC.
In its prospectus summary to SEC, Criteo says it observed more than $200 billion in sales transactions on its clients’ websites in the 12 months ended June 30, 2013 – whether or not a consumer saw or clicked on a Criteo advertisement.
“Based on this data and our other data assets, we delivered targeted advertisements that generated approximately 1.5 billion clicks over the same period,” the statement said.
“Based on these clicks, our clients generated over $6.5 billion in post-click sales. A post-click sale is defined as a purchase made by a user from one of our client’s websites during the 30 day period following a click by that user on an advertisement we delivered for that client.
“We believe post-click sales is a key performance indicator that our clients use to measure the effectiveness of our solution in driving sales and the return on their advertising spend with us. As of June 30, 2013, we had more than 4,000 clients and in each of the last three years our client retention rate was approximately 90%.”
Criteo’s revenue increased from €65.6 million in 2010, to €143.6 million in 2011, to €271.9 million in 2012 and from €113.1 million for the six months ended June 30, 2012, to €194.3 million for the six months ended June 30, 2013.
The submission goes on to explain how Criteo believes its solution is transforming the way that its clients use internet display advertising to drive sales, by making display advertising a more efficient and effective medium for engaging – and converting potential customers for e-commerce companies.
Criteo said key benefits of its offering include highly relevant targeted ads, compelling performance at scale and a performance-driven business model.
“Our goal is to be the leading platform through which e-commerce companies across industries and geographies use online display advertising to drive customer engagement and conversion,” it stated in the summary.
Within the summary, Criteo was also required to list potential risk factors – such as while it has experienced rapid growth in recent periods, its recent growth rates may not be indicative of its future growth.
Risk-wise it also stressed that large and established internet and technology companies may be able to significantly impair its ability to operate, and that the market in which it participates is ‘intensely competitive and fragmented’, meaning it may not be able to compete successfully with its current or future competitors.
In July, PI also reported on Criteo’s acquisition of AD-X Tracking, which lets brands and agencies keep tabs on the performance of their in-app mobile ads.