The recent acquisitions of Business.com and PremierGuide got me thinking about the value of product/service-specific traffic and how much premium is added by scale/brand/penetration.
If we ignore the layout differences between Business.com and the more typical IYP format we can see that the type of visitor should be similar - people looking to buy products or services. They get a lot of visitors and have a great domain/brandability.
PremierGuide is at the other end of the scale, it's a white-label Local Search provider (so there's not much consumer branding that can go on there) that gets roughly a tenth of the traffic of Business.com.
Here's what they sold for:
Considering that PremierGuide had revenues of around $800K/year I'd say the $2M price was a little low, but even allowing for that it's still way below the $/visitor price for Business.com.
At the low end of the scale it looks as though most people would be better off continuing to run rather than selling!
Has anyone seen a recent deal for a small/medium Local Search publisher (let's say 500,000 to 2.5M visitors/month) that had a good multiple?
I would have thought that larger companies would have been keen to buy up smaller ones and tie in the founders for a few years and then have them on non-competes (with the acquisition price being enough to justify this).