Nashville-based to be acquired by Yahoo!

Breaking: is reporting that Brentwood, Tenn., based is about to be acquired by Yahoo! for as much as $100 million.

Sidenote 1: This is a real “phoenix” boom, bust, rise-from-the-ashes story. The founders in Seattle who started it raised and burned lots of cash. The assets were purchased by some Nashville-area folks in the resulting fire sale. And then, a profitable business model was put in place and the company has done nothing but grow for the past six years. No talk of Web 2.0. Never mentioned on TechCrunch. Just crazy growth.

Update: (5:30 p.m., EDT) has an item that points to’s report, but has not been able to confirm the story.’s Walker Duncan reports the company “saw revenue of approximately $22 million in 2006. This year it is looking to push that figure up to $35 million.” The website says it recorded more than 3.5 billion (with a “B”) page views in 2006 and on “national signing day” in February recorded 74.3 million page views. For my friends in other parts of the country who may read this and wonder why, I’ll just say that down here in the south, fans of college football teams can dedicate a big chunk of their waking-day discussing what college may be chosen by a promising lineman from, say, Opp (Ala.) High School. Radio shows spend hours on that topic and an entire industry has evolved to serve the limit-less need to know what college some 16-year-old may consider in 2009. For these folks, “national signing day” ranks up there with Christmas and the Daytona 500.

  • Rex, do you think, however, it’s a success story if $75M of VC translates into a $100M exit?

  • Rex Hammock

    Let me try to explain this again. The original investors — the VCs who put in $75 million — lost all their money. The original startup went through that investment in the manner many startups did such things in the 1999 era. When that company no longer had the ability to maintain its burn rate (to use a term from that era), it went out of business. The assets of the company were then sold — I don’t recall if it was in a bankruptcy case or by the creditors. The current owners of acquired those assets at the depths of the dot.bust market when no one wanted to have anything to do with a “” investment. The purchased those assets — which, as I recall, was a software platform, some URLs, the list of registered users and lots of disgruntled former “contributors” who ran forums on the site — although I don’t think that group was actually “acquired.” The new owners instituted a business model and overhead structure that enabled the company to run profitably within a few months. I’m guessing that the return on their investment will be quite robust. I think their’s will be a tremendous success story. As for the first group of VCs who lost all of their $75 million, the answer is no. Like many of us, they lost lots of money the first ’round. I feel certain they moved own with their lives and figured out how to succeed in the next round.