eLocal, of Conshohocken, has accelerated its consolidation of rival “pay-per-lead” and “pay-per-call” firms, acquiring Felix and CityGrid from billionaire Barry Diller’s InterActive Corp (IAC).
The deal follows last fall’s eLocal acquisition of Ring Router, a Pasadena, Calif.-based company that finds customer leads for insurance companies. IAC and eLocal won’t say what the acquirer paid in their deal. IAC chairman Diller ran West Chester-based QVC, the home-shopping TV network, in the early 1990s, when it was owned by Comcast. IAC shares were up 5.5 percent, to $183, on Friday, beating the market averages.
“Here’s how it works: local services providers — roofers, plumbers, legal professionals — use eLocal to help consumers in need find their businesses online," said Michael Pantilione, vice president atLLR eLocal’s lead investor. “Your local plumber might not have a website or the tools to appear in the search results when a consumer Googles ‘plumbers near me.’” eLocal and its partners may insert an eLocal ad on a user’s search, links the ad to its call center, forward the call, and gets paid when the consumer reaches the local service provider.
In a statement, eLocal CEO Bruce Aronow called CityGrid and Felix “early leaders in performance-based marketing” that will now “partner, rather than compete” with eLocal.
Chief revenue officer Jill Labert added there are “tremendous synergies” between the firms, implying cost savings from the combination.
Updated: eLocal CEO Bruce Aronow said his company has brought on all 18 CityGrid and 38 Felix employees as of the time of the deal. After the companies are integated over the next couple of months, eLocal will employ around 100, about 40 in Conshohcken, other in New York and Burbank, Calif., and at remote locations. The combined companies will do business mostly under the eLocal brand.
CityGrid grew by linking local-business advertisers to popular websites and phone apps through local subsidiaries including Citysearch, Insider Pages, and Urbanspoon. CityGrid then reduced those operations and turned toward pay-per-lead and pay-per-call services after IAC acquired Felix from Yext in 2012.
The acquisition spree follows a $25 million investment in eLocal in late 2017 by LLR Partners, the 20-year-old Philadelphia private-equity firm, founded by investor Ira Lubert and his partners, who invest for clients including the Pennsylvania state workers' (SERS) and teachers' (PSERS) pension systems.
eLocal is run by Aronow, and cofounded in 2008 by his brother Andy Aronow and Andy Kaplan. The Aronows and Kaplan are also principals at Rockland Capital, a West Philadelphia-based real estate firm. Announcing LLR’s investment in November 2017, Aronow called LLR, with its history of expansion investments in small firms, “an easy choice to help us pursue our growth ambition” in a changing business.
Before LLR bought in, eLocal focused on finding customers for home services, legal and financial services clients. The acquisitions have added “performance-based advertising product” for medical, insurance, automotive and financial businesses as well. Aronow said he would use his firm’s proprietary technology, which "only costs [clients] money when the phone rings” and a lead is confirmed, plus LLR’s capital, to diversify into other sectors “that value live phone calls and leads.”
Separately, OraSure Technologies Inc., the Bethlehem company that collects saliva samples for DNA testing, said it has agreed to buy Belgium-based Novosanis, which makes the Colli-Pee urine-collection and testing systems, and two-year-old Minnesota-based CoreBiome, which specializes in “microbiome sample collection with end-to-end laboratory services of sample processing, sequencing, and bioinformatics” for drug, farm-supply, and research firms. As the overall stock market rose Friday, Orasure shares were up 3 percent, to $11.74, around midafternoon.
OraSure is run by Steve Tang, who joined the company last year after a decade running the University City Science Center, the office and lab landlord partnership led by Penn, Drexel, and Children’s Hospital of Philadelphia. The company, which estimates sales at $46.5 million for the last three months of 2018, didn’t immediately say how much it was paying, but said the two acquisitions should add more than $4 million to net sales this year.
In a statement, Tang said OraSure’s acquisitions “add differentiated products” that will boost sales and profits, helping OraSure’s DNA Genotek subsidiary "to cultivate commercial customers, key opinion leaders, and academic collaborators.”
CoreBiome was cofounded in 2016 by Dan Knights and two colleagues at the University of Minnesota. CoreBiome’s BoosterShot platform “allows researchers to efficiently run high-resolution DNA sequencing on thousands of microbiome samples,” said Knights in a statement. He and Tang called it a fast-growing business.