ReachLocal IPO Moving Ahead
ReachLocal says it is going ahead with its IPO. A new filing with the SEC noted that it will price 4.8 million shares between $17 and $19, allowing it to raise between $81.6 million and $91.2 million — below the $100 million it originally wanted to raise. If the IPO is successful, it may be followed by IPOs from WebVisible, Yodle and Clickable.
Prior to the filing, doubts have been raised whether ReachLocal’s IPO would see the light of day. While Reach’s revenues have been strong, from a typical base of 15,000+ customers, churn rates suffered throughout the industry have raised concern. Google’s recent efforts to cut back on markups charged by third-party resellers like ReachLocal hasn’t helped either.
But ReachLocal has been enhancing its appeal to SMBs by broadening its range of paid and organic services in creative and valuable ways. In March, for instance, it purchased SMBLive, a business profile and Web site service, for $8.5 million.