THE DIVESTMENT CAMPAIGN
Our Client – The Vendor
WOMO is Australia’s leading consumer-generated business directory and review website, providing consumers genuine and relevant business reviews in an extensive ‘one-stop’ directory. Its content is unmatched in terms of quality, relevance, sector spread and volume. Operating from the Melbourne suburb of McKinnon, the business is underpinned by a subscriptions-based revenue model that derives income from the companies reviewed on the site in exchange for online marketing and customer service tools. By late 2014, the site offered close to 400,000 reviews and had 174,000 active reviewers. Since its inception in 2007, it has generated consistent revenue growth along with strong EBIT.
By 2015 WOMO’s founders had completed the development and early stage commercialisation of the Business. The website was receiving >1,000,000 page impressions and >500,000 unique visitors (users) per month, with 80-90 new members signing up each day (over > 30,000 p.a.). In order to support ongoing growth, they sought to find a new owner with greater resources and marketing capabilities. The founders engaged Johnsons Corporate as specialised mid-market business brokers to facilitate the sale of the Business to a strategic suitor, who would be able to leverage the WOMO platform and allow it to realise its full potential.
The International Sales Strategy
For an acquirer WOMO represented an opportunity to enter or expand in an industry segment poised for significant growth in Australia – the online social review market. It offered an established brand with a strong value proposition for consumers and the businesses they reviewed. And, rare for an online venture, this was a fully commercialised, profitable and content-rich asset, which featured a proven revenue model and established online presence.
Johnsons Corporate’s custom research & marketing spanned Australian and overseas markets, focusing on Online Directory Services, Advertising Firms, Business Intelligence Providers and Media Companies. Secondary targets from related markets included Australian companies in Consumer Research, Social Media &/or Digital Services. Johnsons ran a proactive direct marketing campaign that uncovered 6 qualified, interested parties. Further vetting and negotiations resulted in Offer and Acceptance being secured within 12 weeks of going to market.
(Read more about how using a Specialised Mid-Market Business Broker Approach to selling your business could get you a better outcome – just like our client).
The Strategic Trade Buyer
The purchaser, Oneflare – a growing online services directory business with the aim of being the largest services marketplace in Australia and expanding overseas shortly – was seeking to grow its distribution platform via acquisition.