Marchex Acquires Telmetrics

Marchex, a leading provider of call analytics that drive, measure, and convert callers into customers announced the acquisition of Telmetrics, an enterprise call and text tracking and analytics company, for consideration of up to $13.1 million in cash.

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Telmetrics specializes in providing call analytics to enterprise customers in a variety of vertical categories such as auto, local aggregators, digital agencies and online directories. In addition, the company’s Smart Number product enables enterprises to capture and analyze SMS/text interactions as part of its real-time media call analytics solutions. Telmetrics processed more than 100 million minutes of conversation between businesses and consumers so far this year.

“Our vision is to create the leading conversational analytics company, including voice and text solutions. With the addition of Telmetrics, Marchex has increased our footprint of opportunities, expedited our growing text communications product initiatives, and captured additional scale and efficiencies with our call analytics business,” said Russell Horowitz, Executive Director and Member of the Office of the CEO. “With a significant, growing list of enterprise brands utilizing Marchex’s AI-powered conversation analytics solutions, we believe we have enhanced our opportunity to deepen relationships and open up new customer segments.”

“We are excited to combine our product capabilities and customer conversational data with one of the largest conversational data sets in the world. Customer conversational data is a transformative asset in applying AI and machine learning to unlock the valuable insights needed to build new analytics solutions for customer conversations across communication channels,” said Andrew Osmak, CEO of Telmetrics. “I’m very proud of the accomplishments of our devoted staff and we look forward to joining forces with Marchex to leverage our collective capabilities to unlock the value of every conversation, across voice and text, for brands of global scale to local SMB’s across the United States and abroad.”

Strategic Rationale

Faster Innovation. By combining resources, the companies expect to leverage machine learning and AI-driven capabilities across one of the largest conversational data sets in the industry to deliver unique, personalized, sales enhancing solutions for customers across communication channels, including voice and text.

Expanded Enterprise Solutions. The combined company will give a unified view of customer communications across voice and text channels to surface critical insights and create actionable solutions. These expanded capabilities will help companies find, engage and nurture their most valuable customers across two of the most important communication channels, voice and text.

A Higher ROI for Advertisers. By understanding which customers are interacting with brands across all digital marketing channels through voice and text-based communications, the combined company can solve the attribution gap for brands when consumers go “offline” in their path to purchase.

Additional Scale and Efficiencies. The combination and scale of the joint company enables Marchex to accelerate sales efforts and realize operational efficiencies. These efficiencies are expected to be recognized starting in mid-2019 and beyond.

Transaction Details and Financial Considerations

  • Total Cash Consideration up to $13.1 million, with $10.1 million paid at close and contingent payments of up to $3 million, subject to achieving certain growth targets consisting of both revenue and OIBA components over two years. In addition, Marchex will issue restricted stock units up to $0.5 million and options to certain employees of Telmetrics subject to vesting over three and four years, respectively.
  • We expect amortization of intangible assets from acquisition will impact GAAP results. For the remainder of 2018 and for 2019, we expect the acquisition to be accretive on a non-GAAP basis.
  • Additional financial details will be provided on the Company’s third quarter earnings release and conference call on November 5.

About Marchex

Marchex understands the best customers are those who call your company – they convert faster, buy more, and churn less. Marchex provides solutions that help companies drive more calls, understand what happens on those calls, and convert more of those callers into customers. Our actionable intelligence strengthens the connection between companies and their customers, bridging the physical and digital world, to help brands maximize their marketing investments and operating efficiencies to acquire the best customers.

Please visit http://www.marchex.com

About Telmetrics

Telmetrics is a call and text tracking and analytics company that enables, tracks and analyzes offline interactions to increase engagement and return on advertising spend. At the core of our solutions are millions of unique local and toll-free phone numbers that can be placed in any online, or offline ad. By tracking consumer voice and text response to each number, our clients can pinpoint which lead sources, media channels, and keyword buys are yielding the most success and can measure the quality of those leads. Our response and conversation analytics are available in real-time, easy to understand and give businesses the insights they need to lift your advertising ROI.