Details from the Yodle S-1 Filing: 45K Customers, $162M in 2013 Revs

Yodle logoYodle filed its S-1 yesterday for a roughly $75 million IPO. Below are some excerpts:

  • Yodle had $161.8 million in revenue in 2013, up from $132.3 million in 2012
  • Q1 2014 revenue was $45.7 million up from $35.2 million a year ago
  • There was a net loss of nearly $6 million in Q1

Yodle says its addressable market is roughly 7 million small businesses. It had “approximately 44,800 customers as of March 31, 2014.” The company cites third party data estimating that there are 74 million local businesses globally. (This is a very conservative estimate.) The implication is that Yodle will expand internationally.

Yodle describes its product suite as “CMO in a box.” Below is a representation of the company’s offers and how they all fit together.

Yodle product suite

Source: Yodle S-1 filing

In comparison to Yodle’s approximately 45,000 customers, ReachLocal reported 24,100 active accounts but revenues of roughly $125 million in Q1 2014. ReachLocal’s average revenue per advertiser was $5,187 in Q1. Yodle had average revenue per customer of $1,020 approximately.

Among the risk factors the company identified were the following:

Historically, we have experienced a high turnover rate in our customer base, especially within the first year of launching a customer. We believe there are a variety of factors which may result in increases in our turnover rate or fluctuations in our revenue. These factors include:

  • customer satisfaction with our products;
  • our customers’ perceived value of our products and their return on investment, or ROI;
  • changes to pricing, including in connection with expanding our offerings;
  • the number of our products used by our customers;
  • decreased spending by our customers on advertising and marketing generally, and on digital marketing in particular;
  • cessation of our customers’ businesses, as small- and medium-sized local businesses have historically experienced high failure rates;
  • increased competition in the local business digital marketing environment . . . 

Yodle added that it “purchases the majority of its media from Google, and the business could be adversely affected if Google takes actions that are adverse to Yodle’s interests.” In addition, the company reported:

In January 2014, we entered into a revised agreement with Google that, among other things, provides us with certain performance bonuses if we meet certain advertiser spend targets and other requirements. If we fail to meet those requirements, and as a result do not qualify for the rebates, our operating results would be harmed. 

One could see the data above and assert that Yodle is in a weaker position than ReachLocal based on revenue per customer. However it has just under 2X the number of customers of ReachLocal. Accordingly it has the opportunity to grow revenue per customer — though retention remains a challenge.

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One Response to “Details from the Yodle S-1 Filing: 45K Customers, $162M in 2013 Revs”

  1. Dave says at

    Ahhhh Yodel.   The team there wants to dig into the public trough and pull out cash….

    Meanwhile there is a timely discussion about yodel over at the Local Search Forum.  Most comments aren’t pretty….including mine.  Virtually every time one sees a public conversation about the business in a local framework, some folks chime in and describe a miserable experience with them:   And in this discussion there are some less than happy campers describing past experiences.      AGAIN

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