Web.com acquires Yodle to boost local marketing

Web.com set to buy all available shares of Yodle, closing at the end of the first quarter of 2016

Yodel, based in New York, sells online marketing services, helping small businesses improve their Internet presence using email, paid advertising and search engine optimization.

Based in Jacksonville, Web.com provides domains, hosting, website design and management, search engine optimization and online marketing campaigns. This acquisition helps accelerate Web.com’s position as a national small business digital marketing provider.

In the announcement, Web.com says the move:

  • Improves Web.com’s growth profile by adding higher growth revenue streams.
  • Adds complementary products and expertise in vertical markets, professional office applications and a successful franchise platform serving more than 9,000 locations by building on Web.com’s ongoing initiatives to grow in these areas .
  • Creates an up-sell and cross-sell opportunity on a 3.4 million subscriber base.

David L. Brown, CEO and President of Web.com, said, “The acquisition of Yodle is a natural fit for our strategy at Web.com. Value-added digital marketing solutions are a large and rapidly growing part of the market where Web.com has developed a set of differentiated offerings. This market segment has been a strategic focus for us for several years, and the purchase of Yodle will consolidate our position as a leading national supplier in this field.

“We are thrilled to have acquired a company with a strong track record in developing and selling vertical solutions that help small businesses attract new business and retain existing customers through cloud-based marketing platforms. ” Brown said.

Web.com will initially pay $300 million, then $20 million on the first anniversary and $22 million on the second for 100% of Yodle’s outstanding shares. It will be funded by bank loan financing. Closing is scheduled for the end of the first quarter of 2016.

The mix of these companies should improve the experience of local businesses in marketing and selling online. Yodle brings its expertise in optimizing online presence to Web.com’s web hosting business.

Yodle was founded by Nathaniel Stevens, Milind Mehere, Ben Rubenstein, Kartik Hosanagar and John Berkowitz in 2005. The company was previously called “NatPal”, but changed its name in 2007.

Initially, NatPal struggled until a dentist hired them. This gave them the idea to target their business to doctors, lawyers, as well as other local businesses. Changing its name to Yodle, the company grew until in 2013, Yodle was ranked #28 on Forbes’ 2013 list of “America’s Most Promising Companies”.

Web.com started as Micron Electronics and sold computers. After closing its PC business and entering the website market, Micron Electronics began acquiring related businesses. It then changed its name to Interland in 2000. After changing its name to Web.com, the company continued to grow when in 2007 it merged with Website Pros in 2007.

Image: Small Business Trends