Company Sunday Sky The veteran (Sunday Sky), which develops software for creating custom video, planned an IPO at the Tel Aviv Stock Exchange at the beginning of the year, in which it will raise $ 70-100 million at a value of NIS 1 billion (about $ 280 million). This offering would provide liquidity to Sunday Sky shareholders, some of whom, like the Viola Ventures Fund, invested in the company as early as 2008, a year after its inception. Sunday Sky was already in the process of writing a prospectus.
But since then the momentum in the markets has completely changed in relation to technology companies and Sunday Sky has had to redesign a route. Instead of an IPO, the company announced today (Monday) the sale of its control to the American private equity fund Clearhaven Partners. At the same time, Sunday Sky announces the dismissal of 24 workers in Japan, Israel and the United States, who make up 13% of the workforce, as part of a reorganization following the changing global economic situation.
The Sunday Sky platform / Photo: Courtesy of Sunday Sky
The announcement made by Sunday Sky about the sale of the control is vague and company executives chose not to provide further details and clarifications. According to the announcement, the acquiring fund will invest over $ 100 million in Sunday Sky – with part of the amount going into the pockets of existing shareholders, who will sell control (over 50% of the shares), and part will flow into investing in the company. Each scenario involves a deal that gives Sunday Sky a lower value compared to what it expected to receive in the IPO.
Sunday Sky was founded in 2007 by Shmulik Weller, who serves as the company’s president and vice president of product, and Yaniv Aksen, who serves as vice president of technology. The company’s CEO is American Jim Dixo, who has been in office since 2017. The company has raised about $ 75 million to date. According to the IVC database, in addition to Viola, Comcast Ventures, Vintage, NTT DOCOMO and others have also invested in it.
Sunday Sky allows companies to create custom videos for their customers, in which the customer’s personal details are implanted, from his name to information on his usage patterns. For example, an insurance company can make the annual report sent to customers accessible through a video in a fixed format, in which the personal details of each customer are embedded. In the same way online sellers can create a variable video for different products they sell based on ready-made templates, a product that Sunday Sky launched last year.
According to details released in late 2021, ahead of the planned IPO, Sunday Sky is poised to end the year with a recurring annual revenue (ARR) of over $ 40 million. The Sunday Sky business model is currently built on two-year subscription licenses for the software.
Sunday Sky’s small competitor in the field of custom video is a company Idomo (Idomoo), who is also Israeli. Idomo was issued a year ago on the Tel Aviv Stock Exchange at a value of $ 344 million, but has since been cut by 80% and traded at a value of only NIS 70 million. Even if Idomo had a lower annual revenue rate than Sunday Sky, which stood at $ 13.1 million in 2021, the decline in its value still illustrates the contraction of the multipliers that companies in the field receive.