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Shutterstock plans to acquire GIPHY from Meta

GIPHY, the world’s largest collection of GIFs and stickers will be sold to photo licensing agency Shutterstock.
The deal allows GIPHY owner Meta to sell the platform following a UK competition regulation order last year – read the BBC report on the CMA order.

“This is an exciting next step in Shutterstock’s journey as an end-to-end creative platform,“ remarked Shutterstock CEO Paul Hennessy. “Shutterstock is in the business of helping people and brands tell their stories. Through the GIPHY acquisition, we are extending our audience touch points beyond primarily professional marketing and advertising use cases and expanding into casual conversations. GIPHY enables everyday users to express themselves in memorable ways with GIF and sticker content while also enabling brands to be a part of these casual conversations. We plan to leverage Shutterstock’s unique capabilities in content and metadata monetization, generative AI, studio production and creative automation to enable the commercialization of our GIF library as we roll this offering out to customers.”

Deal details:

Strategic Highlights:

• Augments Shutterstock’s generative AI and metadata strategy, including mobile generative AI at global scale.

• Taps into a large and growing TAM in native advertising for brands seeking touch points with customers in-moment via mobile phones and communications tools.
• Expands Shutterstock’s content library to include GIFs and stickers used in more casual conversations – GIFs have over 75% positive sentiment among consumers.
• Combines Shutterstock Studios and GIPHY Studios to enable world-class custom content solutions for brands and advertisers.
• Enables access to a massive user base consisting of 1.7 billion daily users generating 1.3 billion search queries.
• Extends Shutterstock’s API ecosystem to include GIPHY’s more than 14,000 API/SDK partners.

Financial Highlights:
• Consideration for the transaction consists of $53 million of net cash paid at closing, inclusive of working capital.
• Cash consideration funded through cash-on-hand and existing revolving credit facility.
• In connection with this transaction, GIPHY’s current owner, Meta Platforms, Inc., is entering into an API agreement to ensure continued access to GIPHY’s content across Meta’s platform.
• Shutterstock is maintaining its 2023 revenue and adjusted EBITDA margin guidance.
• GIPHY is expected to add minimal revenue in 2023 with focused monetization efforts taking place over the course of 2024.
• The transaction is targeted to close in June 2023, subject to customary closing conditions.

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