Dice Buys Geeknet's Media Business, Including Slashdot, In $20M Deal 466
wiredmikey writes with the press-release version of news that we'll probably be updating as more details trickle down to the editors: "Dice Holdings (Owner of job sites including Dice.com) reported this morning that it has acquired Geeknet's online media business, including Slashdot and SourceForge. 'We are very pleased to find a new home for our media business, providing a platform for the sites and our media teams to thrive," said Ken Langone, Chairman of Geeknet. 'With this transaction completed, we will now focus our full attention on growing ThinkGeek.' Dice Holdings acquired the business for $20 million in cash. In 2011, the online media properties generated $20 million in Revenues." The AP has a small piece with the news, too. Update: 09/18 16:16 GMT by T : Ars Technica has a story up as well.
Let's Just Hope They Leave Well Enough Alone (Score:5, Informative)
*looks at Slashdot*
*begins nervously wringing his hands*
Re:Let's Just Hope They Leave Well Enough Alone (Score:5, Informative)
This is still pretty new to us, but we've been looking at this as a positive thing -- we were worried earlier that if we were rolled into a business that focused entirely on news, we'd be expected to conform to company standards -- see the Gawker sites, for example.
Slashdotted, text/Webpro. (Score:4, Informative)
Dice Holdings has acquired the online media business of Geeknet. This includes such notable tech sites as Slashdot, SourceForge and Freecode.
The acquisition price is $20 million, which the companies say is the same amount the properties generated in revenue in 2011.
In case you're unfamiliar with the sites, Slashdot is a user-generated tech news site. You used to hear the term "slashdotted" a lot, when as site got so much traffic from the site that its servers crashed. There's actually a sizable Wikipedia entry about the "Slashdot Effect".
SourceForge is an open sources software site for developers, and Freecode is a large index of Linux, Unix and cross-platform software and mobile apps.
Slashdot gets over 5,300 comments a day and 3.7 million unique visitors per month. SourceForge gets 40 million unique monthly visitors, and about 80% of them are from outside of the United States, according to Geeknet. Freecode gets about 500,000 unique visitors per month.
"The acquisition of these premier technology sites fits squarely into our strategy of providing content and services that are important to tech professionals in their everyday work lives," said Dice Holdings Chairman, President and CEO Scot Melland. âoeThe SourceForge and Slashdot communities will enable our customers to reach millions of engaged tech professionals on a regular basis and significantly extends our company's reach into the global tech community.â
"We are very pleased to find a new home for our media business, providing a platform for the sites and our media teams to thrive," said Geeknet Chairman Ken Langone. "With this transaction completed, we will now focus our full attention on growing ThinkGeek."
Re:And please, Mr. Geeknet (Score:5, Informative)
The media business part of Geeknet is being moved over as a whole. So, all of our projects and priorities are continuing unchanged. In fact, we just had a meeting about this, and the folks from Dice were very clear about not wanting to interfere with the community.
Re:Please keep the URLs working (Score:5, Informative)
I don't think this will be an issue, but I'll make sure everybody's aware of it.
Re:Let's Just Hope They Leave Well Enough Alone (Score:5, Informative)
If you RTFA, you'll see that GeekNet have sold on Slashdot, SourceForge and Freecode, while retaining ownership of ThinkGeek:
Ken Langone, Chairman of Geeknet, added, "We are very pleased to find a new home for our media business, providing a platform for the sites and our media teams to thrive. With this transaction completed, we will now focus our full attention on growing ThinkGeek."
Re:Let's Just Hope They Leave Well Enough Alone (Score:5, Informative)
All too often, "standards" means pushing positive "stories" about advertisers, censoring any content from the public that might offend said advertisers, and generally turning your site into a boring shitfest that no traditional /. user would be caught dead on if Peter Jackson himself came down from geek heaven and offered them them a prop sword from LotR and a handjob in exchange for staying.
Re:Care to Elaborate? (Score:5, Informative)
Well, I'll answer what I can; we editors are not part of the decision-making process, so I first heard this news only a few hours ago myself. This is my reaction from what I've heard today from the higher-ups. Duress isn't a factor -- in fact, one of the quotes from the meeting I most liked was in response to a question about whether we were posting news of the announcement on Slashdot, and how the community would react. The Dice folks simply said, "Let them talk." I'm sitting in a conference room right now next to a gentleman from Dice, and he's just been curious what people are saying; hasn't suggested any comments or messaging at all.
As far as being consumed by a bigger fish, keep in mind that Geeknet (aka SourceForge aka VA, etc) was a bigger fish itself. If you think about Geeknet's business, it was rather broadly spread. Slashdot's a news site, ThinkGeek's an e-commerce business, Sourceforge is its own thing. They have common roots, but they don't really go together. I've been aware of Dice, but not terribly familiar with it, but wouldn't you say its business would tend to fit Slashdot better than ThinkGeek?
As far as the MySpace situation.. well, not all companies are alike, and not all companies see value in the same way. The crew currently running things is more concerned about the Slashdot user experience than some others have been in the past, and that's been a plus. Obviously, I can't see the future, so I don't know how it's all going to play out. But my initial impression is positive. I'm thrilled at the possibility of getting a bigger investment into Slashdot, both from an engineering perspective and an editorial perspective.
Multiples (Score:5, Informative)
I'm not totally sure what it means to sell them for 1 year's revenue
Buyouts and mergers are typically done as a multiple of some portion of the earnings or revenue of the company. It's a quick and dirty way to estimate the value of a company without doing a lot of math. Typical multiples for companies are between 0.8-1.2X annual revenue or 3-5X annual EBITDA (earnings before taxes, interest, depreciation and amortization). The multiple is usually adjusted up or down depending on the prospects of the company, the industry it is in as well as the economic climate. Software companies might command a higher multiple than a bricks & mortar retailer. Comparing buyout multiples to historic trends is a good way to identify bubbles as well as gauge the economic climate.
A multiple of 1X annual revenue is a fairly typical price to pay for a company. Doesn't necessarily mean it is a good price but it is about what I would expect someone to pay. In short, I wouldn't read too much into the price paid.
Re:$20,000,000? (Score:5, Informative)
According to an article on TechCrunch [techcrunch.com], these three sites have a yearly profit (EBITDA) of $5 million. From what I've read the purchase price (3*profits + some) is typical of acquisitions of mature companies. It is neither insane dot-com buyout (expecting unrealistic growth), or clearance corner liquidation of assets (expecting to bleed it till it dies).
Typical price (Score:5, Informative)
Are we missing something? I'd love to buy an entrenched business for one year's worth of revenue...even if revenues were slowly declining.
Actually that's a fairly typical price for a buyout. Most buyouts are done as a percentage of revenue or EBITDA. Revenue multiples of around 1X annual earnings is a pretty typical price for a firm though it varies by industry, prospects and economic climate. Typical revenue multiples for any buyout is 0.8X-1.2X annual revenue or 3-5X EBITDA.
Remember that if you buy a company for its annual revenue, eventually you have to make that money back. If the profit of the company is say 10% of revenue it will take 10 years to recoup the investment.
Re:I hope they don't just let it languish (Score:4, Informative)
Why do you need a kickstarter?
The code is here [slashcode.com]. Get a domain and some hosting, post some interesting stories. If you edit the summaries, and avoid flamebait articles, people might look!
Re:Let's Just Hope They Leave Well Enough Alone (Score:5, Informative)
How important is Sourceforge, really? Aren't all the cool guys on GitHub by now?