Zemanta - From SeedCamp to Outbrain

In the summer of 2008, I attended the SeedCamp in London and the winner of that class was a company called Zemanta, out of Ljubljana Slovenia. I was taken with everything about Zemanta; a small team (three founders), out of a place that I had never been to and had barely heard of, winning the SeedCamp with a really smart blogging tool that I just had to have on my blog.

USV invested in a seed round that summer that was led by the SeedCamp folks and Eden Ventures. Zemanta was USV’s first European investment. Today, we have ten out of sixty-seven active portfolio companies (~15%) based in Europe.

The seed investment in Zemanta led to a nine year journey with Bostjan and Andraz, who founded Zemanta along with Ales.

The blogging tool is amazing. It recommends links and images in real time as you type into your blogging tool. I still have it running in my WordPress web application. It looks like this right now.

Zemanta sold the blogging tool to a company called Sovrn a while ago and refocused on the native advertising market. They understood how to place related content into a content feed as well as anyone and they decided to focus the company on that. Bostjan and Andraz recruited Todd to lead the new business opportunity. Over the course of the last three years, Zemanta DSP has become the leading buying tool for native advertising.

And the largest company in the native advertising market, Outbrain, became their largest customer. So a few months ago, Outbrain asked the Zemanta founders to join their team and help build some important new technology for Outbrain. After haggling for a few minutes, the deal was sealed and Outbrain now has an office and a team in Ljubljana.

Like every investment, Zemanta taught me a few important things. I learned how to work with founders from a different part of the world, I learned that Ljubljana is a lovely little city with wonderful cafes and restaurants along a gorgeous river, I learned that you can keep a company alive for almost a decade on less than five million dollars if you have a crack team of product managers, data scientists, and software engineers in a place that most people don’t know about, and I learned that tenacity wins, always.

I am pleased that Zemanta has found a home inside a larger company with a bigger opportunity, I am pleased that Ljubljana has a startup success it can point to, and I am pleased that USV is now a shareholder in Outbrain, an investment I mistakenly passed on a decade ago. But mostly I am pleased that Bostjan and Andraz, with a lot of help from Todd, were able to go all the way, from startup to exit, never losing that which makes them special. That’s a big win in my book.


Comments (Archived):

  1. Ronen Koehler

    what a great story! welcome to Outbrain!

  2. Nik Bonaddio

    I’m somewhat surprised that you’re so positive on Outbrain. On one hand, there’s an obvious monetization problem with content; I don’t think I really need to sell anyone on that.On the other, hand Outbrain and their ilk are faced with an impossible challenge of keeping their recommendations of sufficient quality, creating a vicious cycle where brands rely on increasingly low-quality, high-click bait content to generate the lost revenue at the cost of their brand equity.Outbrain in my experience is currently the “best” in terms of this, but as they get squeezed by more and more competitors who do the exact same thing (and/or offer larger pay distributions in order to undercut them and steal market), they’re forced to adjust their guidelines to accept crappier and crappier content.I can understand it more if you’re positive on them just from a “solving a big problem” perspective; they do solve a problem, one that is increasing in severity, and probably make a very nice profit doing so. I don’t think it’s sustainable for the reasons above however and almost all consumers hate it, which is where my surprise comes from.(EDIT: Wanted to add that I’m very happy for the team at Zemanta. I don’t want to let my above comments color what is an extremely positive outcome for them; they should be congratulated.)

  3. JimHirshfield

    Great win for Zemanta. Congrats to my SLO friends. 😉

  4. Tom Labus

    Are expectations defined differently for founders in other countries?

  5. William Mougayar

    That’s an amazing story. I was a fan of Zemanta from its early days due to their use of semantic technology. I just spent 3 days in Ljubljana & it was indeed charming to the hill. Slovenia has amazing wines, food, nice people, – and now a burgeoning blockchain ecosystem, which was the reason for my visit.

    1. WA

      Very pretty – even in the rain.

  6. mosjef

    What a wonderful personal experience and delightful outcome for some of my favorite people in the whole darn world.

  7. Eric Friedman

    Thanks for sharing your lessons learned – I have a lot of great lessons learned from Zemanta and great to see this outcome.

  8. jason wright

    does ‘zemanta’ have a meaning in Slovenian?

    1. todd sawicki

      nope – it’s a play on the word semantic (z’s in slovenian are pronounced like s in english)

  9. creative group

    CONTRIBUTORS :Fred’s post highlights how the smart money can pass on a good deal and because of the tight knit eco-friendly VC pipe line can still benefit through another gateway. This smart money in a no lose system unless the entire market collapses. (1990 bubble)The tea leafs and fundamentals say uncontrolled exuberance will experience a correction.

  10. CJ

    Well done, I’m a fan of the product – the blogging product that is.

  11. pointsnfigures

    The long and winding road…

  12. Evan Van Ness

    Slovenia is also becoming a hub for crypto/web3(Disclosure: I’m an advisor to Cofound.it, which is based in Slovenia)

  13. awaldstein

    We need stories like this Fred.Few are home runs which we all love.I cherish the long and windy path that ends in a safe place. Honestly few do.

    1. PhilipSugar

      What a great comment.

  14. Mike Geer (MG)

    I’m a big fan of Zemanta and Bostjan and Andraz. Well done, all!

  15. @billg

    Bravo to their tenacity and to your patience!

  16. Twain Twain

    Congrats to Bostjan and Zemanta team. Bostjan was kind enough to meet for dim sum when I landed in NYC in late 2010.

    1. PhilipSugar

      Winner, winner.Sometime I want to go to Dim Sum with you.I am having Crystal Dumplings (you taught me that word) with my son tomorrow at Sang Kee: For his birthday: He loves the duck: https://www.sangkeechinatow

        1. PhilipSugar

          Mmmm.. For the best Indian go here: http://www.dishoom.com/cove…Tell them Mr. Sugar sent you. One of my British colleagues was trying to get a reservation for dinner for her anniversary when we were in Dubai.They said we are full. I said use my name. Reservation accepted.

  17. sigmaalgebra

    Yup, for Internet content, products, and more, recommendation, discovery, and ad targeting are all closely related.

  18. todd sawicki

    Thanks Fred! We couldn’t have done it without you – let it be said – you were a mensch and a valuable advisor all along the way. Thank you for your support. Glad you were an investor.

  19. andreaitis

    Such great news for Andraz, Bostjan, Todd and Ales. We first first met the Zemantans in 2008. We were sitting in the corner of an office a few floors down from Fred and the USV offices. We used Zemanta on our news startup, True/Slant, and the partnership continued when we were acquired by Forbes. Many twists, turns and years — and one memorable trip to Slovenia — later, it couldn’t have happened to a nicer group of people. Collaborative, kind and hopefully now celebrating. Congrats, all.

  20. Andrej Krizmancic

    Really makes me happy reading about Zemanta success. :)Congratulations to the team!I’d like to point out that they’ve also done a significant contribution to the local startup scene. They are connecting the local startup community which is getting bigger for many consecutive years.Besides many other things they’ve also organised an event where Fred was a guest in a public chat few years ago in a bar in Ljubljana. I was lucky enough to attend this event and I read this blog since then. And I’m very thankful for all the knowledge you share Fred!Thank you 🙂

  21. Kirsten Lambertsen

    Great story! I remember Zemanta from nearly the beginning but had lost track of them in the last couple of years.There’s a lot to like both about that team’s work and your perspective on them 🙂 Congrats Team Zemanta! You’re an inspiration.

  22. OurielOhayon

    Welcome to the Outbrain Family 🙂

  23. Vashishtha Kapoor

    Great Journey indeed. Most of the startups fail in the modern time due to communication gap or understanding. Seems like you guys helped each other and had great understanding tool.

  24. Mark Essel

    This is a pretty amazing story, gratz to the team. I had thought Zemanta was in for some rough times when I saw the blogging tools vanish but that was a critical turning point of their success.

  25. Christopher Fong

    I agree with all the comments that we need more stories like this Fred!Congrats to Bostjan and Andraz and everyone in Ljubljana Slovenia.What are the other blogs that avc members subscribe to? I get Fred’s posts emailed so I don’t miss them. What other blogs do you read that share uplifting stories that also help you keep up to date on tech?

  26. Donna Brewington White

    Such a refreshing and encouraging story. Congrats to all!