Dentsu Aegis Buys HelloWorld, formerly ePrize, for an Undisclosed Sum

When we first visited the headquarters of HelloWorld in 2012, the company was still called ePrize and was swiftly outgrowing its Pleasant Ridge, MI, digs. After several years of exponential growth, HelloWorld announced last week that it has been acquired by Dentsu Aegis Network, based in the U.K. The financial terms of the deal were not disclosed.

HelloWorld, which started as an online sweepstakes startup founded in 1999 by Detroit/Ann Arbor Xconomist Josh Linkner, has grown into a major digital marketing operation with global reach, serving dozens of top brands like Walgreens, 3M, and Carhartt. In the process, HelloWorld also became one of the first successful homegrown tech companies in metro Detroit. The company is now up to 375 employees across offices in Southfield, MI; New York; Chicago; Seattle; and Los Angeles.

HelloWorld CEO Peter DeNunzio says the deal with Dentsu Aegis came about as a result of the company’s owner—Connecticut private equity firm Catterton Partners, now called L Catterton—deciding that the best way to continue HelloWorld’s upward trajectory was to find a “strategic buyer from the marketing services sector to fuel growth on both sides.”

That process began about a year ago, he adds, with Dentsu eventually emerging as the right fit. According to a press release, Dentsu is interested in adding HelloWorld’s “people-based” strengths in customer experience and enterprise tech to the capabilities of another marketing company it owns called Merkle. DeNunzio was already familiar with Merkle because it had been a long-time competitor and source of poachable talent for HelloWorld.

“We’re aligned in our point of view of where the industry is going,” DeNunzio explains. “The foundation for both companies is the idea that all marketing is personalized in the digital age, and the best approach is data-driven and tech-enabled. Merkle’s DNA is in data-driven, tech-enabled consumer engagement. We bring them some scale, heft, and tech capability; they bring customer loyalty and consumer profiling.”

Dentsu Aegis will absorb HelloWorld’s entire workforce, and DeNunzio expects there will be “incremental growth” in 2018 before the full impact of the companies’ integration is unleashed in 2019.

“I think we’ll emerge as a power player in loyalty,” he predicts.

DeNunzio says HelloWorld’s success is also a good-news story for metro Detroit, especially considering HelloWorld’s initial investors, including Quicken Loans chairman Dan Gilbert, were mostly from Michigan.

“We never lost the belief that Detroit is our spiritual home, and we’re happy to be part of its renaissance,” he says. “Our commitment to Detroit is solid.”

Sarah Schmid Stevenson is the editor of Xconomy Detroit/Ann Arbor. You can reach her at 313-570-9823 or sschmid@xconomy.com. Follow @XconomyDET_AA

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