Urbanspoon Bought by IAC, Will Remain Independent Brand
It’s an acquisition that is truly surprising to no one, but now it’s official: Seattle-based Urbanspoon, the online restaurant guide, has been bought by New York-based IAC (NASDAQ GS: IACI) for an undisclosed amount. Urbanspoon will stay an independent brand based in Seattle, and will report to Jay Herratti, who heads up some of IAC’s most prominent Internet brands like Citysearch, InsiderPages, and Evite. IAC has a market cap of $2.4 billion and owns dozens of popular sites, so its resources should come in handy. The deal closed on February 13, but was kept tightly under wraps.
Urbanspoon co-founder Ethan Lowry says it’s been “awkward dancing around that” for the past two months, especially when he has been approached by investors. He emphasizes that the most interesting aspect of the deal is “we can take advantage of the enormous traffic that comes to other IAC sites. They have huge followings. Our little product brains are spinning.” When asked whether that means branching out beyond restaurants, Lowry says, “We’re definitely looking at ways we can tackle tangential stuff. I think Urbanspoon should stay a restaurant brand, but there may be other ways to tie that in.”
Lowry said in a statement that he’s excited to be part of the IAC family, and that the acquisition enables Urbanspoon to “expand our reach and develop new products while maintaining our brand identity.”
That has always been important to the scrappy three-man startup, which was founded in 2006 by ex-Jobsters and has been completely self-funded from its inception. It has been profitable since its early days, even before it gained worldwide attention with its slick iPhone application. In December, I sat down with Lowry to talk about Urbanspoon’s expansion to every city in the U.S., in part through a partnership with Citysearch—which is apparently how IAC got to know the startup, and which led to the acquisition talks.
PaidContent.org speculates that the IAC purchase price was in the low double-digit millions, while others guess it’s a little lower. TechFlash reports some more comments from Lowry this morning, including that IAC was interested “50-50″ in Urbanspoon’s iPhone app (which gets more than a million “shakes” a day) and its website (which gets 3 million-plus visitors a month).
In terms of the immediate future, Lowry says, “We have no plans to double the size of the company [from three to six] or anything ‘crazy’ like that. It’s largely unchanged. From an entrepreneur’s perspective, I like that they’re giving us a lot of autonomy.” As for recent developments, he points out that Urbanspoon now works with Facebook Connect, which is driving a lot of traffic. “Now you can do everything you want to do on Urbanspoon through your Facebook account,” he says. “If you leave a review or take a picture, those get automatically posted on your Facebook feed.” So if you have friends on Urbanspoon and you try a new restaurant, you can see right at the top of the page what your friends think of the place.
Speaking of new restaurants, Lowry says he recently tried an Italian joint called Cantinetta, which opened in Wallingford in January. “One of the best little halibut dinners I’ve ever had,” he says.