International restaurant directory Zomato is reportedly entering the US in a splashy way: it has bought Urbanspoon from IAC. Based in India but operating in 130 cities around the world, Zomato raised $60 million from Sequoia Capital late last year and has raised over $100 million to date.
The rumored purchase price is that $60 million from Sequoia.
Urbanspoon was founded a year before the release of the iPhone but it was the Apple device that propelled the site to success with its long-gone carousel restaurant finder. That novel feature helped gain attention and put Urbanspoon on the map.
In 2009 the company was acquired by IAC but largely neglected thereafter. Urbanspoon established enough of a brand to have maintained a loyal following however.
Zomato is entering the North American market with the acquisition. It’s unlikely however that Urbanspoon will survive as as a brand. It’s pretty clear that Zomato is building a global brand and dining platform. Urbanspoon will probably be absorbed into that effort in the relatively near term.
The company is not simply a directory. It currently offers booking (in the UK through OpenTable) and is moving into payments. At least in the restaurant category Zomato could emerge as a formidable rival to Yelp over time.
GeekWire has reported that current Urbanspoon CEO Keela Robison will leave as part of the acquisition. Zomato has publicly said that it has 30 million monthly users around the world, most of whom use its mobile apps. That user-number would potentially double with Urbanspoon’s traffic.
Given the sale of Urbanspoon I would anticipate IAC soon unloading Citysearch, which is a much weakened and diminished version of its former self.
Update: the company confirmed that the purchase price was “between $50 and $60 million.”