The deal makes sense given the two companies have similar but not identical products. They serve a similar target segment in multi-location brands. Yet there is minimal customer overlap.
In theory, at least, this should be a fairly straightforward migration of customers from one platform to another. Yet, with any deal, there is a risk that customers will resist the migration. Or that the company cultures will fail to mesh. Or any of countless other risks. So time will tell how different this deal looks in real life vs. on paper. But there is no doubt this one looks good on paper.
We caught up with SOCi CMO Monica Ho, who offered a bit of exclusive color on the deal. The first thing we wanted to know is why SOCi honed in on Brandify as its first acquisition target since its $80 million Series D round in January. Here is how Monica summed it up.
“[SOCi CEO] Afif [Khoury] and [Brandify CEO] Manish [Patel] have known one another for a long time, and have a shared passion and vision for the local marketing space and where it is going. Brandify has been a leader in local search marketing with nearly 25 years of experience, supporting more than a million local businesses. Its comprehensive suite of search solutions, including Listings Management, Local Pages, and Locator Sites, along with its incredibly talented pool of local marketing & search experts, make it the perfect complement to our business.
“Additionally, Brandify brings with it even deeper relationships with key networks like Google, Facebook, Apple, Yelp, and more, allowing us to continue to deliver cutting-edge tools for the networks that matter the most to your business. SOCi and Brandify both share a strong customer orientation and vision for creating technology solutions that empower multi-location brands to build consumer awareness and increase sales through localized marketing.”
A Single Platform for Localized Marketing
We also wanted to know which unique pieces of Brandify’s platform would survive the integration. Not surprisingly the answer was, in essence, “to be determined.”
“This is something that will develop over the coming months as we integrate and better understand the needs of our customers. Given the strength of both companies, there is a great opportunity to create best-in-breed solutions,” Monica said. “Ultimately, Brandify’s solutions will be integrated into the SOCi platform, deepening the combined company’s local search capabilities, and making it the only platform to offer all localized marketing solutions on a single, unified platform.”
Monica also told us that SOCi has offered employment to the entire Brandify team. One exception is Patel, who will continue to service the advertising portion of the previous Brandify business through his new company, Omni Local. According to its website, “Omni Local combines hyperlocal advertising with the latest in artificial intelligence (AI) technology and foot traffic attribution.”
Patel, according to SOCi, will “remain a trusted friend and advisor as we work to integrate the two organizations.”
This acquisition is the second big deal this summer involving companies in the local search and listings management space. In June Uberall announced it had raised $115 million and that it had acquired fellow location-marketing firm MomentFeed.
What About Street Fight?
An interesting secondary storyline to this deal is the fate of Street Fight, which SOCi has acquired in this sale. Brandify acquired the events and industry news platform in 2017. Monica told us SOCi doesn’t have any big changes in mind for Street Fight.
“Streetfight will continue as it has been and will remain an independent part of the organization,” Monica said. “I don’t think they are a significant part of this deal or that anything will change with them under SOCi ownership, as it’s crucial to maintain that independent journalistic approach to what they write.”
It’s worth noting that Many of SOCi’s peers and rivals, including Yext and Uberall, have in-house analysts (e.g., Greg Sterling and Duane Forrester) and produce volumes of research reports and other forms of content. Many also run their own events (at least they did pre-Covid).
Damian Rollison, currently Brandify’s VP of Market Development, has played a similar role as an in-house thought leader for Brandify. We asked Monica what role he would play at SOCi.
“I do not know what his specific role will be,” she said. “But I do not foresee much changing when it comes to his involvement in podcasts, written materials, though leadership, etc.”
After SOCi’s $80 million raise, it was a matter of if, not when it would make a major acquisition. A consolidation play seemed likely a likely first move. Especially given how crowded the local search space has become in recent years.
With any significant funding round comes pressure to grow. And growth can come from many avenues. These include investing in the product, marketing, and sales. And through acquisitions.
In fairness, SOCi was growing fast before making this acquisition. It recently pushed out this announcement, reporting it experienced more than 100% year-on-year revenue growth in the first half of 2021. It also reported increasing its staff by 70% since raising the D round.
We imagine we will see more deals in the local search industry before this long hot summer is over.