1. What are you announcing today?
Today we are announcing that Reply! is acquiring MerchantCircle, the largest online network of local business owners in the nation, for $60 million in cash and stock. With this acquisition, Reply! greatly enhances its access to local merchants and consumers, and enables the combined companies to rapidly shift locally-targeted advertising dollars online. While each company has achieved success and profitability on its own, together we’re a local online marketing powerhouse with estimated revenue of more than $100 million in 2012, and will aggressively target a market that has been estimated at $110B (according to the Kelsey Group).
2. What are the terms and conditions of the transaction?
This is a cash and stock transaction valued at about $60 million.
3. How will the combined company be structured?
The combined company will have two components:
- Reply! Marketplace – the company’s online marketing platform for the acquisition of locally-targeted and category-specific consumers on a cost-per-lead or cost-per-Enhanced Click™ basis
- Reply! Media – the company’s portfolio of media properties that includes MerchantCircle.com, Contractors.com, Bloglines.com, iMotors.com, and many other consumer-facing destinations.
The MerchantCircle team will become the Reply! Media division, and MerchantCircle.com will be a part of Reply! Media.
4. Who will be CEO?
Upon close of the deal, Payam Zamani will be CEO of the combined companies, which will be called Reply! Inc. MerchantCircle CEO Ben T. Smith IV will become President of Reply! Media, reporting directly to Payam Zamani.
5. How many employees do you have? Will you be downsizing?
MerchantCircle has about 40 employees, Reply! has about 185 employees. We have no plans to downsize. In fact, we are in growth mode and are aggressively hiring. We’ll be looking to leverage our current team members to help us continue this growth and gain market share.
6. How much funding has been raised by each company to date? Who are the current investors?
- MerchantCircle: MerchantCircle has raised $14M to date. Investors include Rustic Canyon Partners, Scale Venture Partners, Steamboat Ventures and IAC.
- Reply!: Reply! has raised about $17M to date. Investors include Scale Venture Partners and Outlook Ventures.
- Current MerchantCircle board members Joey Levin and Peter Horan will be joining the Reply! board.
7. Why is Reply! acquiring MerchantCircle?
Both companies share a vision to connect consumers everywhere with the locally-targeted advertisers who want their business. With profitable businesses and very complementary assets, the acquisition of MerchantCircle allows Reply! to greatly enhance its access to local merchants and consumers, and gives us the opportunity to grab a sizable share of a growing industry, estimated to reach $110 billion.
Company assets include:
- The patented Reply! Lead and Enhanced Clicks™ auction Marketplace, powering an industry-leading platform for the acquisition of locally-targeted customers
- Over 25 million unique local visitors per month to the Reply! Network of consumer destinations
- Over two million member locally-targeted advertisers using the Reply! platform to access ready–to-purchase consumers
- Access to over one million consumer leads per month in virtually every category
- Major online consumer destinations including MerchantCircle.com, Bloglines.com, Contractors.com, iMotors.com, and many more
8. Why did MerchantCircle decide to sell now?
MerchantCircle has been very successful at helping businesses get online and reach local consumers, establishing relationships with 1.6 million local businesses. Reply! helps locally-targeted advertisers easily and cost-effectively acquire new customers online. By combining forces, we’ll be able to offer locally-targeted online advertisers a broader array of services to reach local consumers and help sell their products and services. The local business market has seen significant growth during the last few years, and combining the two companies allows us to increase market share as more locally-focused businesses move online.
9. What problem does Reply! solve?
Search engine marketing and display advertising are too complex for many businesses, and it’s hard for locally-focused advertisers to target based on location. We give advertisers a simple, effective way of acquiring local online customers: our solution requires no online marketing expertise, and we provide market-based pricing in an auction format for the purchase of leads and Enhanced Clicks™. These leads are 100% targeted based on user-submitted intent and location.
Reply!’s Marketplace also allows local consumers to connect to local businesses and get competitive quotes from companies that want their business.
10. Why is this deal good for businesses targeting the local consumer?
Reply! is solving a huge problem for locally-targeted advertisers: how to easily and cost-effectively acquire new customers online. By combining forces with MerchantCircle, we’ll be able to offer locally-targeted advertisers even more services and ways to reach local consumers. By eliminating the need for advertisers to develop and maintain complex, expensive online marketing infrastructures and teams of experts to source online consumer traffic from many different channels, Reply! simplifies online locally-targeted marketing for businesses of all sizes. The combination further enhances the liquidity of the marketplace by greatly increasing the number of locally-targeted advertisers in the marketplace as well as consumer traffic and leads.
11. Why is this deal good for consumers?
Reply! and MerchantCircle both make local search more actionable for consumers by integrating “Request For Quotes” into the search experience. For example, consumers searching for plumbers often need to have expensive work done immediately, and Reply! allows consumers to receive competitive bids from several local businesses, saving both time and money. We do a great job of delivering that highly localized information. We also offer scale: consumers can connect directly with over two million small businesses as well as national brands with locally-targeted solutions across the U.S., with coverage in virtually every category.
12. How will you integrate the product offerings?
Reply! has been working with MerchantCircle for the past few months on testing a “Request For Quote” option in search results, and combining our companies allows us to roll out those capabilities more rapidly. For MerchantCircle’s local business members seeking to acquire online consumers, Reply!’s marketplace offers search-like controls for purchasing leads and Enhanced Clicks™. With no search engine marketing expertise required, locally-targeted advertisers can buy what they want and bid whatever they choose. This approach creates a stable network and complete nationwide coverage, dramatically improving both the advertiser and consumer experience. Together through our marketplace and all the local connections we enable, we’ll give businesses more high-quality connections with local consumers than they’ve ever had before.
We’ll be at ad:tech San Francisco, at Moscone Center, from April 11-13. Come by our meeting room, MR2, and learn about our leading online marketplace and exchange for locally-targeted clicks and leads, serving the Automotive, Home Improvement, Insurance, and Real Estate categories.
Leverage Reply!’s Enhanced Click™ and Lead Marketplace to provide incremental monetization with:
- Request For Quotes – Integrate links, buttons, or forms to receive incremental CPL & CPC monetization
- Exit Monetization – Convert abandoning traffic into $$$
- White Label Platform – Leverage Reply!’s Marketplace to
- Offer an auction-based Lead Marketplace & Exchange
- Sell Lead packages to merchants, fulfillment by Reply!
Reply!’s Marketplace Provides An Easy Opportunity To Integrate Cost-Per-Click and Cost-Per-Lead Monetization
San Ramon, CA and Mountain View, CA —March 21, 2011—Reply.com, the leading marketplace for the acquisition of locally-targeted and category-specific traffic, today announced a partnership with MerchantCircle, the largest online network of local business owners in the nation. As a result of this partnership, MerchantCircle will leverage Reply.com’s patented lead marketplace to offer new price quote features to consumers who visit the MerchantCircle network.
The integration with Reply.com’s Marketplace, which will cover multiple categories (including home services, automotive, real estate, and insurance), will improve the consumer experience across the MerchantCircle network and will create a new, and significant, incremental revenue stream.
“We’re excited to be partnering with MerchantCircle,” said Reply.com founder and CEO Payam Zamani. “Their business model dovetails nicely with our Marketplace, allowing consumers to request competitive quotes on local services. The simplicity with which our Marketplace offerings can be integrated with a high-quality service like MerchantCircle.com allows them to enhance their consumer offering while improving yield for their traffic.”
Ben Smith, CEO of MerchantCircle.com, says of the relationship with Reply!: “Our research shows that local consumers are looking for two things: deals from local business owners and competitive price quotes from local service providers. While we have made great strides in delivering unique, valuable deals to consumers, our relationship with Reply! provides consumers with a simple and effective way to access competitive price quotes from hundreds of thousands of local service providers. The Reply! team has been terrific to work with and we look forward to a long, mutually-beneficial relationship.”
About Reply!, Inc.
Reply.com operates the leading auction marketplace that enables advertisers to acquire locally-targeted and category-specific customer prospects on a cost-per-Enhanced Click™ or cost-per-lead basis. By eliminating the need for advertisers to develop and maintain complex, expensive online marketing infrastructures and teams of experts to source online consumer traffic from many different channels, Reply.com simplifies online locally-targeted marketing for businesses of all sizes. To learn more about Reply!, visit www.reply.com.
Founded in 2005, MerchantCircle is the largest online network of local business owners in the nation, combining social networking features with free marketing tools that enable merchants to maximize their online visibility. Over 1.6 million merchants use MerchantCircle to create conversations with customers and connect with other local merchants.
In 2010, MerchantCircle acquired TimeBridge and the popular Bloglines service to further extend its network offerings. MerchantCircle is based in Mountain View, Calif., and funded by Rustic Canyon Partners, Scale Venture Partners, Steamboat Ventures, and IAC. Learn more at http://www.MerchantCircle.com.
Reply.com will be attending LeadsCon Las Vegas, March 1-2, and would love for you to join us! To make it easier, here’s a link to be able to register for only $545—that’s $200 off the current registration price, and $400 off the onsite registration price!
You can only get this special price through the link above. It is not being made available on the LeadsCon website. The offer is good until February 11, 2011. After that, you will have to pay regular price, so register today and save!
LeadsCon is the preeminent conference for companies and individuals looking to maximize performance in the lead generation industry.
*Discount rate good on new registrations only. Credits or refunds cannot be issued on previous registrations. Discount rate good through February 11, 2011, prevailing rate applies after that.
Reply.com Founder and CEO Payam Zamani will be participating in a panel discussion about agencies, local search, and display at the BIA/Kelsey Interactive Local Media Conference on Thursday, December 9. This conference will be held at the Hyatt Regency in Santa Clara, California. The session is scheduled for 9:30 a.m. Pacific Time. Other speakers on this panel include Geomentum President Lisa Bradner and Scott Greenberg, Senior VP of Strategic Development at Marchex.
The Company Also Announces the Acquisition of Contractors.com
San Ramon, CA – June 7, 2010 — Reply.com (www.reply.com), a leader in locally-targeted online marketing, announced that it has entered into a loan agreement with Hercules Technology Growth Capital, Inc. which provides up to $15 million in venture debt to Reply.com. Hercules Technology Growth Capital (NASDAQ: HTGC) primarily finances privately-held companies backed by leading venture capital and private equity firms.
“We are pleased and excited to announce this new relationship with Hercules,” said Reply.com Founder and CEO Payam Zamani. “This loan facility allows us to more proactively consider relevant opportunities for acquisition.”
In addition, Reply.com announced that it has acquired certain assets of Contractors.com to further enhance its home improvement-related offerings. “With the addition of Contractors.com to our family of offerings, we are confident our locally-targeted marketing solutions will reach companies and professionals in the home improvement industry more efficiently,” said Zamani.
About Reply!, Inc.
Reply.com operates a proprietary auction marketplace that enables advertisers to acquire locally-targeted and category-specific customer prospects on a cost-per-Enhanced Click™ or cost-per-lead basis. By eliminating the need for advertisers to develop and maintain complex, expensive online marketing infrastructures and teams of experts to source online consumer traffic from many different channels, Reply.com simplifies online locally-targeted marketing for businesses of all sizes.
If you haven’t registered for LeadsCon East, there’s still time to take advantage of our discount rate!
We hope that you will join us at LeadsCon East (July 26-27). We are pleased to pass along the discounted registration rate of $395* to our clients—a $300 savings off the onsite price!. Register from this site to get this special price. You cannot get the discount through the regular LeadsCon website.
Serving as “the pioneering conference and expo dedicated to increasing the effectiveness of those operating in the online lead generation industry,” LeadsCon brings together the top brass from the online customer acquisition space.
Come visit us at LeadsCon East, where we’ll show you what the Reply.com Marketplace can do for you. Learn how to acquire more ready-to-purchase customers using Reply.com’s Enhanced Clicks™ program. Also, see how the Reply.com Leads program can help you control lead price, quality, and volume—all while optimizing results.
*Discount rate good on new registrations only. Credits or refunds cannot be issued on previous registrations. Discount rate good through Wednesday, July 8, 2010. Prevailing rate applies after that.
Reply! employees recently enjoyed a Cinco de Mayo luncheon/fiesta featuring fantastic Mexican food, churros aplenty, piñatas galore, a trivia contest, and mucho merrymaking. What a great way to kick off the new month and celebrate Cinco de Mayo! ¡Mire las fotos bonitas!
Interested in joining the fiesta? Check our jobs page.
At yesterday’s IAB Networks and Exchanges Marketplace conference, Managing Director of GCA Savvian Advisors Terence Kawaja, also a seasoned investment banker specializing in media, gave a state-of-the-industry address entitled “Parsing the Ad Tech Value Chain.”
Key takeaways from Kawaja’s speech:
- Display is a very crowded marketplace
- Demand-side capabilities are expected to merge
- Google is moving into display, leveraging both their content network and DoubleClick exchange
- Data becomes ubiquitous and commoditized, but still difficult to tie to the user online
- Advertisers no longer need to buy a site to find the right audience
- Publishers must leverage data, understand their audience, and segment to maximize revenue
- Welcome the anticipated consolidation of agency, marketing, and technology companies
- Locally-targeted marketing is not addressed by the current solutions
The last point on the list highlights the dearth of solutions for companies looking to simplify their locally-targeted online marketing processes. . .
Reply.com is the leading online marketing platform for the acquisition of locally-targeted and category-specific consumers on a cost-per-click or cost-per-lead basis. By eliminating the need for complex and expensive online marketing infrastructures and large teams of experts, Reply.com makes Internet marketing available to businesses of all sizes.
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Join us at ad:tech San Francisco – where digital marketers are growing their businesses and careers. The expo offers a powerhouse lineup of influential, leading-edge resources, and the conference provides the latest industry research and insights from talented experts.
New to the Exhibit Hall this year:
Innovation Alley – A dedicated exhibition zone showcasing bleeding edge technologies like Location-based Services, Over-the-Top Video, Virtual Currency and new platforms for Twitter.
App Exchange – The best in web and mobile apps. Quick, 10-minute demos and free downloads!
Expo Floor Presentations – Two Theaters of companies showcasing new technologies – from apps to email to mobile – new products, research and more! See the schedule.
Jaime Cohen Szulc of Levi Strauss & Co.
Chris Anderson of Wired Magazine
Loic Le Meur of Seesmic and LeWeb
Kristi Vandenbosch of Publicis & Hal Riney
Geoff Ramsey of eMarketer
Closing keynote led by Kevin “Nalts” Nalty, featuring the Internet’s funniest people
Save $200 off a Full Conference Pass when you use discount code: SFCONF3. Register now!