Jupiter sells SearchEngineWatch, others for $43 Million

By: grnidone [privmsg - website] On 2nd Aug 2005

Source Title:
Jupiter Gets Out Of B2B Media Orbit, Publisher Sells ClickZ, Trade Shows

Source Url:
http://publications.mediapost.com/index.cfm?fuseaction=Articles.san&s=32701

Story Text:
So far, Danny Sullivan has not chosen to comment on this story at all. There is a one liner post at the Search Engine Watch Forums. It is, however, front page news at the WebmasterWord. I am hoping Danny will comment on this during his radio show today on Webmasterradio.fm.

In a statement, Incisive Media indicated it plans to use the acquisition to expand into the U.S. B-to-B publishing market, and to expand the search engine strategies conferences into other markets. "The acquisition will allow Incisive Media to strengthen its footprint in the US and to roll-out the SES model across the territories in which the company currently operates," it said.
The deal includes the Search Engine Strategies trade shows and the ClickZ.com Network of Web sites, including SearchEngineWatch.com.

- Y! MyWeb

SEW comment

Danny Sullivan comments on the sale

Quote:

* The Search Engine Watch team -- me, Chris Sherman, Gary Price and Elisabeth Osmeloski -- are carrying on with our regular work as part of the deal. While the owners are changing, the quality content we aim to deliver to you is not.

* The upcoming SES San Jose show is continuing just as before, as are other shows on the agenda and further shows to come.

I suppose only time will tell, to a certain extent "he would have to say that anyway"

By cornwall at Aug 2 2005 - 15:21

Bt seems a tad concerned that its too cheap !

Cannot think why, but BT in that WMW thread says

Quote:

- $43 million? Pennies on the dollar baby.
I would put the true evaluation of SES at well over one hundred million. SEW.com with DS is itself worth $43million - let alone the whole ClickZ network.

Put your own valuation on WMW in the light of the ClickZ sale.

By cornwall at Aug 2 2005 - 17:11

They've bought it at around

They've bought it at around one year's revenue (2004).

What's the standard "ballpark" figure for buying offline businesses - three years revenue?

Online businesses never sell for as much as offline businesses though with good reason - the landscape changes too quickly.

That said - with $30 million profits in the six months for this year (at around 50% profit margins), that investment could be made back very quickly.

Outside of the news sites and trade shows, what else does Jupiter do - what is it keeping hold of?

By luz at Aug 2 2005 - 18:34

I hope danny got a large

I hope danny got a large fucking drink out of this...

By Nick W at Aug 2 2005 - 18:37

>Jupiter do - what is it

Jupiter do - what is it keeping hold of

Meckler has been acquiring stock photo companies for a couple of years now. He keeps crowing that they are money-gushers.

the standard "ballpark" figure for buying offline businesses - three years revenue?

Yeah, the 3-to-5 rule.

1X REVENUE --Jupiter has never impressed me as being a dumb-luck corporation. Unless Meckler and his Board members are all terminally ill and have no one left to carry on the business they know something we don't.

By rcjordan at Aug 2 2005 - 19:23

they know something we

Quote:

they know something we don't.

Yeah, I'll bet they think this is the top of the second Internet bubble and it's time to cash out because it will fall from here.

By Brad at Aug 2 2005 - 20:05

Danny

I sure hope Danny got some of that $43million - after all, it isn't Jupiter's work that made SEW the site and company that it is, it's that man and the team behind him...

If Danny were to leave SEW, start his own site and company, complete with events, the network, etc. it would easilt trump SEW/SES in a few months. Hopefully someone high on the corporate ladder has the presence of mind to recognize that.

By randfish at Aug 2 2005 - 22:22

Just in case you didn't

Just in case you didn't know, Rand, Danny did originally have Search Engine Watch, and sold it many years ago to Internet.com (or it may have been something before that...my memory is slipping). I'm sure he got some cash out of that deal. Who knows, maybe he still owned a percentage!

By Jill at Aug 2 2005 - 23:09

from the horses mouth

Alan Meckler has posted the reason for the sale and why it was sold so cheep

http://weblogs.jupitermedia.com/meckler/archives/009626.html

By mick g at Aug 2 2005 - 23:29

I don't think that article really explains why...

..it implies that it is almost bordering on a forced sale!

By cornwall at Aug 3 2005 - 06:39

> Hopefully someone high on

Hopefully someone high on the corporate ladder has the presence of mind to recognize that.

You are very optimistic, aren't you LOL. When is the last time you saw a corporate management recognise such things? I am sorry, but I have just seen to many bad examples of how top management have shit for brains when it comes to value the real values of their possesions - in this case "Danny".

However, I am not too worried about it - corporations come and go but WE stay around :)

By Mikkel deMib Sv... at Aug 3 2005 - 10:31

>> Yeah, the 3-to-5 rule. 1X

> Yeah, the 3-to-5 rule. 1X REVENUE --Jupiter has never impressed me as being a dumb-luck corporation

The price is 1X TURNOVER (approx). That could be several multiples of NET PROFIT.

By Yes at Aug 3 2005 - 13:48

>1X TURNOVER "will be paying

1X TURNOVER

"will be paying about one-time full 2004 revenues for the Jupitermedia assets. For calendar 2004, Jupitermedia reported $39.9 million in revenues for its online media and events divisions."

The above is from MediaPost, got better numbers somewhere? What I'd really like to see in net profit but this transaction doesn't pique my interest enough to warrant digging through publicly-held corp financials ....I figure if I wait long enough someone else will do it, hhh.

As for Meckler's "to pursue stock photos" explanation, without knowing more details I give that about as much credence as the old "to spend more time with family" executive song-and-dance.

By rcjordan at Aug 3 2005 - 14:46

Also mentioned in that

Also mentioned in that article:

"23.6 million in gross profits that year (2004)"

"Its online media and events divisions generated revenues of $21.5 million through the first half of 2005"

So assuming around the 50% profit margin as it seems to do, it could potentially be all paid off within a couple of years if not sooner.

By luz at Aug 3 2005 - 14:51

I could really give a rat's

I could really give a rat's derriere about revenues other than it's an indicator of market --you can't live on cash flow. The GP looks good, but something smells. When you can readily borrow money for single digits no one gives away high-double roi to raise cash.

By rcjordan at Aug 3 2005 - 15:02

Danny seemed to be pleased...

After looking over some of his posts, he seemed pleased about the deal. I got the feeling that being sold off means he has less corporate bs to wade through.

Although, yeah, it does seem strange that Meckler is selling off a moneymaker for cash when you can borrow at low interest rates.

By grnidone at Aug 3 2005 - 17:27