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Reply Banks $6M Round B; Looks To Strategic
Options
VentureWire
By Erica Owen
Wednesday, April 4, 2007 Online consumer services company Reply Inc. scored $6 million in a Series B funding round, bringing its to-date investment total to $23 million, as the newly profitable company looks to its strategic options. New investor Outlook Ventures led the round, while existing backers Scale Ventures Partners and board member Debi Coleman, former Apple Computer Inc. chief financial officer, contributed to the financing. Additional details of the funding were not disclosed. Reply, founded in 2001 and based in San Ramon, Calif., acts as an intermediary between businesses and consumers in traditionally offline industries such as real estate and automotives. Potential customers fill out forms detailing desired product specifications and the leads are forwarded to paying businesses who contact users with information of interest. The Web site counts 14,000 paying clients and processes 200,000 consumer applications each month. Reply collects revenue by charging clients per lead, from subscription fees and through traditional online advertising. Reply Chief Executive Payam Zamani noted the company reached profitability in March, and, therefore, will not need to the use the funding for ongoing operations. Instead, Reply will focus the funding on strategic transitions and acquisitions and expand its consumer services categories into home improvement, mortgages and insurance services. In August 2005, VentureWire quoted Zamani as saying that Reply's valuation superceded $35 million and that the company saw sales of roughly $20 million for fiscal 2004. While Zamani confirmed the reported figures, he declined to update the numbers except to say that Reply's valuation and revenue are currently "significantly" higher than last reported. Zamani said Reply does not anticipate a need for additional funding and that the company is in a good position for an initial public offering or as a buyout prospect. Scale Ventures Managing Director and Reply board member Sharon Wienbar agreed. "I think the company definitely has an opportunity to go public especially with its dual value proposition to consumers and advertisers," Wienbar said. "I don't know what the results will be for Reply itself but they are not forced down one path or another."
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