Marchex Buys IndustryBrains For $30.6 Million

Online marketing services provider Marchex, Inc. purchased contextual advertising company IndustryBrains, Inc. for $30.6 million in a deal that closed Wednesday. The Seattle-based Marchex, which is paying $15.6 million in cash and $15 million in stock, intends to operate New York-based IndustryBrains as a wholly owned subsidiary. No employees are leaving the company, said IndustryBrains CEO Erik Matlick.

IndustryBrains provides contextual pay-per-click links to approximately 1,500 advertisers on publishing sites such as Forbes.com, USATODAY.com, BusinessWeek Online, The Motley Fool, and Travel + Leisure. Last year, the company generated an estimated $6 million to $7 million in revenue and $900,000 to $1.1 million in operating income before amortization.

Marchex offers online marketers a number of services, such as search engine optimization and ad campaign management.

Matlick said IndustryBrains expects that it will be able to tap into marketers already using other Marchex products, and will also have access to Web properties owned by Marchex. "It's really, really a positive move for us, because it gives us a lot of products that can be leveraged together," he said.

For instance, another Marchex subsidiary, TrafficLeader, provides search engine marketing and optimization services to advertisers, some of whom might also be interested in placing contextual pay-per-click ads, Matlick said.

Marchex also owns around 200,000 Web properties, which it begain acquiring in February by purchasing a portfolio of domain names from the company Name Development, Ltd. Marchex is currently building out those sites, said Mark Peterson, vice president of public relations for the company.

Examples of domain names owned by Marchex include videocameras.com, which has a host of sponsored links and ads from Marchex's camera marketers; yellow.com, which offers business listings from six online Yellow Pages; and friendsonline.com, which has a compilation of links to dating sites. Marchex's Web properties draw more than 19 million unique visitors a month, said Peterson. Now that IndustryBrains is part of Marchex, said Matlick, it likely will offer marketers contextual pay-per-click links on Marchex-owned Web properties.

Next story loading loading..