Thoughts on Tech, Deals, and Markets

The Rodney Dangerfield of Lead Gen

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IACI just announced less-than-stellar Q4 results.  The stock continues to languish near 52 week lows.

On a brighter note, ServiceMagic posted heroic numbers given the brutal consumer slowdown.  Revenue was $25.3m, up 15% y-o-y, while EBITDA was $2m, flat  y-o-y.  They are in a highly seasonal business–in Q3 they were at 34m/8m.

ServiceMagic dominates its vertical (home improvement/home services) more than any other lead gen company.   Given the significant economies of scale in a vertically-oriented lead gen business, they have a dominant strategic position.

Yet they are buried in IACI, where ASK.com, Match.com, and others get far more attention, and happen to be dramatically inferior businesses.

Written by sandykory

February 4, 2009 at 8:17 am

Posted in Uncategorized

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