Israeli newspapers YNet and Globes are reporting that MetaCafe, the online video sharing web site, is about to be sold for more than $200 million. Nothing is confirmed yet, but Globes reported that MetaCafe founder Eyal Herzog suddenly left Israel for the US last night to close the sale.

No buyer has been identified yet, but the speculation is centering on the usual cast of prospective buyers such as Yahoo and traditional media companies such as Time Warner. A $200 million sale would mark the third largest Web 2.0 acquisition ever after YouTube and MySpace.

If the deal does happen, it would be a big win for Benchmark Capital's Israel office which provided MetaCafe with $4 million in first round funding. Accel Partners led a $15 million second round earlier this year. Venture capitalists on the company's board include Kevin Efrusy and Arad Naveh.

MetaCafe's unique twist on online video is that it uses algorithmic filtering technology to choose only a few videos to display each day and eventually apply the appropriate advertisments to those. ComScore said last month MetaCafe is the third largest video web site.

I gave the $15 million funding a VC Rating of 7 out of 10 in July. We may soon see if I was right.

For more on MetaCafe, see:
The Deal
MetaCafe blog

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