Taboola CEO Adam Singolda: "I want to be the Robin Hood of journalism on the open internet"
Taboola CEO Adam Singolda: "I want to be the Robin Hood of journalism on the open internet"
The content recommendation giant Taboola has gone through a series of upheavals since its dream IPO in 2021: the bubble burst, the stock crashed, the company expanded into new areas, Yahoo bought a quarter of it, and it signed a strategic agreement with Apple. CEO Adam Singolda explains how to make a business grow in a crisis, what he hates about TikTok and Facebook and how difficult it is to be a proud Israeli in New York after October 7
"On October 7, my brother Roei called me and said: 'Wake up!'" says Adam Singolda, founder and CEO of the content recommendations giant Tabooa. "He was immediately drafted into the reserves as a combat doctor, and spent 70 days in the field. He only went home twice. This is by far the hardest thing I've been through in my life - living in New York when my brother is in Gaza. I felt like I had lost control. I just didn't know what to do. I knew there was nothing I could do to help my little brother. I would get up at 3:30am every day and write or record him a letter. "Good morning, man, it's half past three in New York"... I did that every day. I also told my mother that I don't allow her to call me until Roei leaves Gaza."
Why?
"I was afraid that if I saw her number, I would get bad news. And I just couldn't deal with it. A feeling of endless anxiety that you don't know how to handle. So we agreed that until he gets out of there, I will call her."
Singolda (42) is not used to feeling a loss of control. After all, on a daily basis, he heads a company that trades at a value of about $1.4 billion and employs about 2,000 people in 25 offices around the world - 700 of them in Israel. "From the first day of the war, Taboola opened a war room that supported workers who were affected by the war," he says. "And what is beautiful is that it came from the bottom up, and not from some management decision. All of us wanted to be a part of the social effort. It is difficult to be both helpless and far from Israel. That's why I was so angry about things people said."
One of the people who annoyed Singolda was Paddy Cosgrave, the founder of Web Summit, one of the most important conferences in the global high-tech industry, where Israel is given a place of honor. Less than a week after October 7th, Cosgrave posted on X (formerly Twitter): "I'm shocked at the rhetoric and actions of so many Western leaders and governments" regarding the military campaign that Israel launched in response to the Hamas terrorist attack. "War crimes are war crimes even when committed by allies."
"I saw his tweet and I thought I was going to explode," Singolda says. "We started together, even before he believed himself to be that successful. And when I saw that he wrote that Israel and Hamas should be judged equally for what they do, I told my wife Victoria that I needed five minutes to explode. I went to the room, wrote a comment in one breath without editing, and returned to the family."
Singolda tweeted back to Cosgrave that "A week into the war, when mothers are seeing their babies burned alive by terrorists, when nearly 200 people are still kept hostage, away from their families, when Hamas which is worse than ISIS and Nazis combined because even Hitler didn't burn babies ... is just not a good time Paddy. I'll repeat, not a good time to be "right", and you're just wrong.” Singolda signed the response by clarifying that he would no longer take part in Cosgrave's initiatives in the future or work with him.
"I went to bed and woke up to 200,000 views, with media coverage in The New York Times and many other places," Singolda says. Cosgrave was quick to apologize and qualify his words, but after technology giants, including Google, Amazon, Intel and Siemens, also withdrew from the conference, he was forced to resign from his position. "That's how I was all the first months of the war," says Singolda, "between letters to my brother at 3:30 in the morning and Twitter wars. There are restaurants I will never eat at again, because the owner wrote some stupid tweet."
Diving, learning lessons, rehabilitation
The meeting with Singolda takes place at the Taboola offices in Ramat Gan during a three-day visit to Israel. These days, he skips between Israel, New York, Florida, Japan and China, every hour in his tight schedule is accounted for, and the American secretary conducts him from afar. And yet he makes sure to be interviewed without the supervision of a PR person in the room - not trivial for a manager in his position.
Taboola, which deals in content recommendations for Internet users, has developed a technology that analyzes the behavior of the users on the Internet, and plants recommendations for them on the sites they visit for content that might interest them. It was founded back in 2007 and was issued in the hype days of 2021 (via a SPAC merger) at a value of $2.6 billion, but the bursting of the bubble in 2022 caused its stock to plunge sharply. Since then the company has recovered greatly thanks to some strategic moves, but is still trading at only about half of its IPO value.
Was your value at the time of the IPO a bubble, like some other SPAC mergers?
"It has nothing to do with merging with a SPAC. The entire high-tech industry suffered a blow in 2022 because the market crashed, it has nothing to do with how you were issued or when. Even companies that were issued 10-20 years ago - their value was cut in half in 2022, and Taboola has risen nicely since then. Ultimately, the market chooses again and again a good company with a good product and a good culture. In this sense, the public market is perfect. It rewards good companies exponentially, even if it takes time."
Still, even after the recovery, Taboola is trading at half of its IPO value.
"We have risen a lot in the last two years and I believe we will reach a higher value than that at which we started. Many companies plunged by 90% and stayed there, while we recovered quite quickly."
The recovery process included the layoff of more than 100 employees about a year and a half ago, 6% of the workforce.
"When the market became difficult in 2022, we had to reluctantly adapt to reality, to balance more between income and expenses. I hope we never do it again."
Has the industry learned a lesson from the period of hedonistic parties that ended in collapse and cutbacks?
"The crazy parties are the least important thing. The defining thing that happened in 2022 is that everyone realized that there is no more free money, and that to survive you have to be excellent. Not 'good', not 'good enough', not 'great' — your product has to be excellent. If until 2022 there was so much money everywhere that 'fine' was good enough, that is over. Today's money only goes where it needs to go, and that's a huge change. Today, customers only want to put money into what they know will definitely work. And I don't think we will return to the previous reality in the next 10-20 years. This is an understanding that affects how I work as a business."
How did it affect you?
"We have become closer to the client than ever before. For example, I learned that the first two weeks are important to advertisers, and not the first quarter or month, because most of them do not have an annual or quarterly budget. They need to know in the first two weeks of the campaign whether good things are happening or not. Until 2022, I understood such things much less. Today I am in sync with my customers."
Taboola's business model is structured so that a large portion of its expenses are dedicated to purchasing advertising space for the content it promotes - for every 60 cents it spends on purchasing advertising space, it earns one dollar from the sale of the advertising itself.
Isn't this a slightly shaky model?
"60-40 is not a bad ratio at all and is considered very healthy in the field of advertising in general. Some 30% of that becomes EBITDA (earnings before interest, taxes, depreciation and amortization), and 50% of it into free cash flow - which this year is estimated to reach $100 million. This is a very exciting number. 2024 is going to be a record year, we expect 33% growth in revenues and a doubling of cash flow."
To what extent do you suffer from the regulation of Internet advertisers? In 2020, Apple stopped supporting third-party cookies (small data files that are saved on the computer while surfing, and allow advertising companies to build user profiles on surfers in order to personalize advertisements for them), and Google intends to do the same this year. Doesn't it suffocate you?
"We are in deep partnerships with the content sites where we are part of the page - we are not a third party, but a part of the first party - so it affects us less. And since we are the recommendation system of almost 9,000 content sites in the world, the size of our canvas is huge . Taboola knows what you read last time. So when third-party cookies disappear, companies like us will enjoy a big advantage. We don't lose any information, and we'll just get more budgets and get stronger. We saw it when Apple stopped supporting cookies and our performance improved faster."
Like Robin Hood
Taboola started out as a content recommendation company, but has since expanded into other areas. In 2019, it announced a News feature — a news channel that appears on Android devices when you swipe the home screen to the left. Taboola is responsible for the design of the page and all the commercial side. The product has gained momentum since then and already provides the company with about $100 million a year.
In 2021, the company used the half a billion dollars it raised in the IPO to acquire the American company Connexity, which operates a recommendation platform for online shopping, which brought Taboola into the world of online commerce for the first time. Thanks to the purchase, it can now also offer content recommendations in the field of e-commerce as well as reveal to its customers in the field of content which products their users are interested in so that it is possible to promote them accordingly.
"This means, for example, that if you want to buy a coffee machine for your home, and you browse the website of Time magazine, Time can have a kind of online store that we manage for it, and in the article you are reading you will see a recommendation for an item, titled 'Here are four coffee machines that we checked', which we wrote or assisted in writing. We have a team of reporters for specific areas in e-commerce: financial services, mortgages, product comparisons, etc., and so we built, among other things, such a store for Time, called 'Stamp', and one for the news agency AP."
The next significant step was taken last year, when Taboola signed an agreement with Yahoo for cooperation for 30 years, under which Yahoo purchased 25% of Taboola's shares and became its largest shareholder. Taboola received an exclusive license to sell advertising on all websites and platforms related to Yahoo. Already in the first quarter of 2024, the agreement is expected to bring in more than $100 million for Taboola.
Another essential step came about a month ago, when Taboola signed a cooperation agreement with Apple, under which it will be responsible for advertising in Apple News. "When you buy an iPhone, iPad, or Mac, you get Apple News — a page of personalized news, news you might want to read," says Singolda. "Among these news items we will combine sponsored recommendations from advertisers. First Taboola News took root on Android devices, then Yahoo chose us for the home page of its news website, and now Apple has also chosen us. This is something I never dreamed would happen."
Apple is the peak?
"It's a huge summit, but I want to jump like an deer from peak to peak. Because if you tell me who works with you - I'll tell you who you are. Currently, Taboola encounters 600 million surfers a day, and with Apple it will be much more. It excites us."
This is no longer the Taboola you first established.
"My dream is that Taboola will be everywhere and recommend everything in cars, on television, in the kitchen. Wherever you have an Internet connection, you will receive recommendations from us for everything that is relevant to you. Ultimately, when I look at the advertising on Facebook, Amazon and Google - these are all recommendation systems that serve themselves. I want Taboola to be a recommendation system that serves everyone. To be the Robin Hood of journalism on the open internet, to bring more and more people to content sites and translate that into revenue."
"We're the Jedi battling Darth Vader"
Singolda does not hide his desire to take a bite out of the advertising budgets of the technology and social media giants. He markets himself as an alternative for advertisers in the world of the open internet — "anything that isn't Google, Facebook and Amazon," he says.
It sounds like you have animosity towards them.
"Why? I'm a friend of all of them. I learn a lot from what they do well. But their motivation is to strengthen themselves, and I want to strengthen all the websites and apps. Everyone needs a friend and I'm a great friend. Taboola's goal is to create value and interest so that people will want to be on your website, which is something that Google, Facebook and Amazon don't do."
You are harsher towards TikTok. About a year and a half ago you said that "if in the future our children learn about science, politics and health from TikTok - this is the end of humanity".
"I appreciate TikTok as a product company, but it is missing out big time. If you have a product that children spend an hour and 20 minutes a day on, you have to think about how you place yourself on the good side of history. How do you help them make decisions related to health, science and politics at high level credibility? The danger in this product is that it does not have a balance between nonsense and things that are really happening in the world, real things that were written after being checked by journalists. There is a lack of truth. There are influencers out there who said that it is better not to put on sunscreen when out in the sun, and children follow them. There are those who go out to demonstrate for Hamas like zombies without understanding why. That's why I fear the day my children will have a phone."
It is also possible to argue that you are anti-TikTok simply because it hurts your livelihood.
"Advertisers buy advertising from wherever it works for them. We don't steal each other's livelihood, and we don't really compete with them for budgets. People who see videos on TikTok are not the people who read an article in 'USA Today', it's a different mindset. I would like to see TikTok benefit the press, spread less hate and fake news. In this, I am clearly biased. Taboola's mission, beyond success as a business, is also to be a company that does good - otherwise why engage in it all your life? Facebook and TikTok have a huge opportunity to do something good and they are not doing it."
What do you expect them to do?
"Let them add defenses. Artificial intelligence without defenses is like a cyberattack on your brain. The algorithms on social networks look for things they know you'll want to see in order to keep you on the platform — stay longer, be influenced more and come back. This is a machine whose purpose is to break in, to give you content that results in you making different decisions".
You talk about it like it's heroin.
"I would call it 'the new nicotine for children'. TikTok does not have a balance between quality content and nonsense. On average, a person spends 90 seconds a day reading content written by a journalist, compared to the 1 hour and 20 minutes they spend on Tiktok. I just want to double the time devoted to journalism per minute and make sure that before you open Facebook and TikTok - you see news on the screen."
If AI is the devil, why is Taboola using it?
"The problem is not the use of AI, but the lack of protections against it. There must be anchors to help people know what is true and what is false in matters related to science and health. Our recommendation engine is AI from start to finish, and the algorithm at its core teaches us what people like more and less. Social networks use AI to recommend content that hasn't been checked by anyone or wasn't written by a human at all — and that can penetrate the iron dome of our brains. Taboola, on the other hand, only works with content sites, such as those staffed by journalists, whose role it is to verify data and check what is right and wrong.
"In addition to that, we have 100 people at Taboola who check content written by publishers and content sites, to make sure that they comply with our policy. If you write an article about a mask and claim in it that the person who wears it will never be infected with the coronavirus - it will not be published with us, because there is no way to prove that is true. But in the TikTok world it does exist, alongside much more terrible things, such as content that incites hatred and lies. And in this I see a potential for the end of humanity, much more than the climate crisis. For me, in the fight against fake news and the spread of hatred, Taboola is literally saving the world, like the Jedi battling Darth Vader."
Don't you glorify the media a little too much? After all, even there there are commercial interests, political agendas and biases in the presentation of content.
"I'm not looking for perfection. It's pointless. But even if you claim that in the media it only works 80% of the time, in social media it doesn't work 80% of the time."
The Outbrain and Taboola saga
Singolda's historical rival Yaron Galai, the founder of the competing content recommendation company Outbrain, recently announced his retirement from his position as co-CEO of the company after 17 years. The two companies are old competitors, with Taboola leading most of the time, except for a period in 2011 when Outbrain dramatically overtook it. In 2019, the companies negotiated a merger between them, which ultimately imploded in 2020. In July 2021, both companies issued on Nasdaq, but Outbrain, which then issued at a value of $1.1 billion, plunged sharply since then and has not recovered. Today it is traded at a value of $200 million - less than a sixth of the value of Taboola.
What do you have to say to Yaron Galai, your historical nemesis, who has now retired?
"I applaud him as the one who made this journey together with me for two decades. After all the years, after everything that happened, what remains for me from the rivalry more than anything else is applauding him. I hope he is happy."
Do you have thoughts of following him?
"As long as I'm having fun, I'll stay at Taboola. There's nothing I want to do outside of it."
Outbrain remained in content recommendations and Taboola expanded to other sectors. Is the merger between you still relevant?
"It is definitely an interesting company, so we wanted to merge with it, and we gave it a real try. But today the merger is less relevant. Both companies have changed a lot, and moved to other areas. And in general, the whole industry has changed."
How has the industry changed?
"Five years ago the advertising market was basically Google, Facebook and content sites. Today, Amazon's second line of profitability is advertising; Uber will soon pass the billion dollar mark in advertising revenue; and Netflix made a huge deal with Microsoft. Players with access to a lot of users want to enter the attractive market of advertising, this is a new approach of companies that are going to take part in advertising that are not Google or Facebook. This world is opening up, and every company in the world with access to masses of users has boardroom discussions about how to enter the advertising market. This is a completely new era."
Why should these companies go to you?
"Every company needs an advertising strategy. Most of them will not build the technology themselves, and they will not contact 20,000 advertisers alone, so they need a Taboola. Most of them would also prefer not to contact Google or Facebook, because no one is willing to give them another seat at the table. This is too close and dangerous. These are companies that are involved in your whole life anyway. Taboola is Switzerland in that sense - it will never compete with you. I will never start another Calcalist, I will never compete with my partners. On the other hand, I am big enough to contain their size . A new type of Taboola partner has actually been created, which is very exciting. Companies we didn't think about are getting into advertising through us."
"My innocence helped the business"
Singolda lives with his wife Victoria and their three children in Tenafly, New Jersey, a picturesque rural town, which is close to New York and is known for the high concentration of former Israelis who live there. He served in the IDF's Center of Encryption & Information Security, founded Taboola when he was 25, and two years later moved to New York to be close to the companies whose budgets he wooed.
"I thought about closing the company three times in its first five years because we ran out of money," Singolda recalled. "Why didn't we close? The right thing to do was probably to close. That's the part where being a first-time entrepreneur, inexperienced and naive—helps you think it's probably legitimate to run out of money three times, and you just keep going. If I were an experienced manager, I'd say it's a crap business. But it's precisely the innocence of a 20-plus-year-old boy, who thinks it's legitimate that he runs out of money all the time — that's what kept me going. I'm basically a pretty optimistic person."
Despite settling in America, Singolda says that he puts a lot of effort into maintaining an Israeli identity for the children. "I do a lot to feel Israeli in America, speak only Hebrew with the children, read them books in Hebrew, play Mizrahi music," he previously told Calcalist. "They have no idea that I also speak English."
Is it difficult to be Israeli in New York at a time like this?
"Yes. I have always felt that being an Israeli in New York is the most accepting experience imaginable. I have always felt infinite love, that it is the most inclusive place in the world. And since the war, for the first time in my life, I encountered anti-Semitism face to face here. It happened when we were on vacation with the children. My wife is Polish in origin, and someone passing by said to her in Polish, 'This place was much better before all these Jews took it over.' I was really surprised, I didn't expect it. All these Jews? I told him: 'I'm from Israel,' and he replied: 'Hamas will show you.'"
That’s scary.
"I am convinced that in the end it will be fine, but right now everything is difficult because we are in the middle of it. People have probably always been anti-Semitic, it's just that now we know who they are. We walked among wolves, we just didn't know they were there. Now we just know who they are and what it looks like."
Will you leave?
"No. The situation is not that bad. The world is angry with us, not just New York. And in Europe it is much tougher. Besides, Oz, our eldest son, is supposed to start first grade here already."
Are the tensions towards Israelis also felt at work?
"No. In fact, my business partners always ask how I am and how my family is doing."
You recently took part in New York in the "Yellow Piano" project, initiated by the family of the kidnapped Alon Ohel.
"True. Alon is a gifted pianist, and his family organized piano concerts in all kinds of places, such as Berlin and New York, to increase awareness of the hostages. They contacted me and asked if I would agree to play, and I replied that it was a great honor to be approached and I would be happy to take part in it, even though I am not a good enough player.
"I took a taxi to the square, it was the coldest day of the year in New York. It was crazy, when I finished talking, I put my hands on the piano, it started to snow, and it stopped when I finished playing. It was an out-of-body experience, I felt my soul freeze."
