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08|10|2007 11:41 am EDT

Marchex aquires VoiceStar, adds Bill Day as CMO, renews yahoo! partnership

by Frank Michlick in Categories: News, PPC industry

marchex logoPeter Ejtel (thanks!) sends this link on TechCrunch: One of the big players in the domain field just expanded further: Marchex acquires Pay Per Call Advertising service VoiceStar. While digging into the details of this deal, I came across three additional announcements from Marchex.

voicestar logoAfter some experimenting with Pay per Call ads by Ingenio on the Marchex Network starting November 2005, Marchex apparently thought it was worthwhile to deepen their involvement in this new variety of advertising and decided to buy the Pay Per Call Advertising of VoiceStar in a $28 million USD deal ($20 million in transaction consideration and $8 million in company investment, details below).

TechCrunch writes:

VoiceStar helps track how effective your newspaper and online advertising campaigns are at generating calls to your business. To do this, they sell advertisers a block of phone numbers ($10/month/number) to be placed in news papers or on websites. Each number is unique to an advertising campaign and can be linked through a softswitch to your existing phone lines. […]

VoiceStars primary clients are advertising networks, who use the service to help individual advertisers. As of this past February, they claimed 400 clients with 20,000 individual advertisers working through those clients.

From the Marchex Press release:

The acquisition of VoiceStar gives Marchex a clear leadership position in local online advertising by adding call-based services to its local online advertising platform, making it one of the most comprehensive offerings available, and expanding Marchex’s base of local advertisers and large aggregators.

Marchex total anticipated investment to acquire VoiceStar will be $28 million, consisting of approximately $20 million in transaction consideration and $8 million in company investment. Specifically, transaction consideration consists of approximately $12.9 million in cash consideration and Marchex will issue approximately $7.1 million in restricted stock that is subject to vesting over two-and-one-half years from closing to certain employees of VoiceStar; and company investment consists of $8 million relating to products, infrastructure, human resources and other items through 2008. The acquisition is expected to close by October 1, 2007. VoiceStar will continue to operate from its headquarters in Philadelphia, PA.

“With the addition of VoiceStar, Marchex offers one of the most comprehensive online advertising platforms and agency services for local advertisers at scale in the industry. We can now offer local aggregators a private label search- and call-based marketing platform with distribution for their advertisements in search engines, vertical Web sites, and on our network of local Web sites,” said Peter Christothoulou, Marchex Chief Strategy Officer. “Additionally, we can now also add proprietary pay-per-phone-call advertising units to our network of local Web sites, which allows us to increase the direct monetization of our own properties.”

“We are very excited to be joining forces and bringing the value of our combined assets to a greater audience,” said Todd Lieberman, VoiceStar CEO. “We share Marchex’s vision for unlocking growth opportunities in the local space and look forward to being a part of the innovative solutions Marchex brings to the marketplace.”

Bill DayOn top of this acquisition, Marchex names Bill Day, Co-Founder and Former CEO of About.com, as Chief Media Officer.

In this newly created role, Day will oversee Marchex’s media strategy, including its online content, consumer-facing initiatives and related advertising strategies.

With this announcement, Day assumes responsibility for certain areas and strategies which previously were directed by Marchex Chairman and Chief Executive Officer Russell C. Horowitz. Day, who assumes his new position immediately, will report directly to Horowitz.

“Local search and locally developed and oriented content will be one of the key drivers for the search market over the next five years and Marchex is in a phenomenal position to be a leader in this category,” said Day. “I believe that Marchex’s innovative content initiatives are truly ahead of the curve and I look forward to building on the current momentum and helping to take Marchex’s local consumer experience and related advertising opportunities to the next level.”

“Bill’s extensive track record and expertise in building innovative, consumer media properties and in operating online advertising businesses will enable him to provide important strategic direction to our consumer-facing initiatives,” said Horowitz. “With Bill’s leadership, we are well positioned to realize the significant growth potential of our network and develop it into a leading brand in the local space.”

Prior to joining Marchex, Day was a co-founder and CEO of About.com, a pioneer in providing vertically focused original consumer information and advice. He grew About.com to one of the most highly trafficked content destinations on the Internet, a top 20 global online media network covering more than 700 topics and 50,000 subjects used by tens of millions of monthly users to find highly targeted, useful information. While at About.com, he also pioneered contextual pay-per-click advertising through the launch of the Sprinks Network. Following Primedia’s acquisition of About.com in 2000, Day continued as CEO of About.com, running the division within Primedia through 2003. More recently, from 2004 to 2007, he has been the CEO of MeMedia (formerly WhenU), a privately-held behavioral advertising network. He received his B.S. in Mechanical Engineering from Yale University, and his M.B.A. from the Wharton School of the University of Pennsylvania.

And apparently Marchex news come in threes, as they also announced that the are Renewing their Search Marketing Distribution Relationship with Yahoo!.

Marchex, Inc. […] today announced that it has renewed a multi-year agreement in which Yahoo! will continue to deliver its sponsored search results to Marchex’s network of local and vertical Web sites. Marchex’s network reached approximately 31 million unique visitors in June 2007.*

“Marchex is one of our trusted partners and continuing our relationship with them is consistent with our goal to create the leading advertising marketplace,” said Hilary Schneider, Executive Vice President of the Local Markets and Commerce Division and the Yahoo! Publisher Network Division at Yahoo! “Marchex’s network of Web sites effectively extends our advertisers’ reach and provides them unique local and vertical targeting opportunities across a broad base of categories.”

“Yahoo!’s scale, broad advertiser base and robust platform enable Marchex to deliver relevant advertisements across our expanding network of local and vertical Web sites,” said John Keister, Marchex President and Chief Operating Officer. “Yahoo! has been an important partner for Marchex and will be key to our strategy moving forward as we continue to grow the traffic on our network, build out our local content and create new targeted opportunities for advertisers.”

[Frank Michlick ownes a small amount of Marchex shares.]

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1 Comment

Rob Sequin

August 10, 2007 @ 3:23 pm EDT

WTF Down 22% today.

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