I noticed that Primedia appears to have purchased rentals.com in the past few months. I would love to know what that domain sold for - I am sure it was not cheap.
It looks as though they are making rentals.com their flagship rental site by placing rental ads from rentclicks.com, apartmentguide.com and possibly homerentalads.com on it.
This type of consolidation is also happening at the same time in the vacation rental market where Homeaway.com is the flagship site for about 6 other vacation sites that will feed into it.
I am sure that Primedia will not just throw away all the great branding that RentClicks has acquired over the past 4 years, but I would guess they will be putting all their branding efforts behind the new rentals.com site just as HomeAway is.
It will be interesting to see what happens. What do you think of this type of consolidation? Is it good or bad for your property management company?
[tags]primedia, rentals.com[/tags]
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9 users responded in this post
Any word on rentalhouses.com being up for sale also? Word on the street is that they are looking for a buyout. Love the blog great reading.
Marc
Marc,
I really don’t know. I have not heard those rumors.
If I remember correctly they received another $3M in funding not too long ago maybe they have burned through that money already.
What do you think Marc, have they burned that money already and need someone to buy them out? They placed banner ads on their site a few months ago, perhaps they need cash.
The question is will Primedia purchase them? From Primedia’s public records it says that Rentclicks is making them a ton of money why not purchase a 3rd one?
These are all guesses on my part. Marc I am interested in hearing your guesses.
Thanks for the complement on the blog, I am glad people are reading it and joining in on the conversation.
Good question Marc,
I am sure PrimeMedia threw out a number to RentalHouses.com. Since RentClicks got bought for 12.5 million or possibly two times earnings.
I am sure PrimeMedia offered around 3 - 4 million for Rental Houses.
Lets assume RentalHouses has around 12,000 active ads a month. Of which 70% of those listings come from Property Managers. Again these are all asumptions and could be more or less.
If on average, each property manager has 30 active listings a month. That would give Rental Houses about 280 active PMs paying $299 each month.
Monthly revenue is most likely around 140,000 + 84,000 = $224,000 / mo
or 2.6 mil a year. Now if they have raised 3 - 6 million in capital. I doubt the VCs want to just get their money back.
These numbers are just guesses and who knows how much they really make or don’t in revenue.
One thing is for sure, they have a lot of overhead and their burn rate is rather high so they will need to either have another round of funding or take what they can get.
They have about 40 to 50 people to staff their call center. Salaries at 40 k a year already hits 2 million. Not to mention rent, travel, executive compensation, etc.
http://louisville.bizjournals.com/louisville/stories/2006/01/23/daily36.html?t=printable
I doubt they are even making a profit and yes Dave, they did add the banners to try to earn more cash. Why else would a company want to
piss off their users?
In total, since they are 1/3 of rentclicks according the Alexa traffic rankings, most likely they only make about 10K extra a month on banner ads. If a public traded company goes for the aquisition, short the stock.
Great Blog on rentals. We need more of these types of sites.
VCMoney,
Thanks for the complement on my blog, I am excited about the launch of RadioVine, my new podcast show that will begin later this week.
Just to clarify Rentals.com has been owned by Primedia for several years. They did recently, it appears, reposition this site as a Portal for all of their listings from Apartment Guide and RentClicks, and HomeRentalAds.
As far as, Rentalhouses.com, VCMoney has some good comments and maybe some inside information, I wonder how you figure out the burn and their overhead.
One thing is for sure, consolidation will continue in this space as big companies like Primedia (Apartment Guide & RentClicks), Classified Ventures (Apartments.com & RentalhomesPlus), and Trader (ForRent.com) get more entrenched in the Residential Rental space.
Industry Vet,
Thanks for letting us know that Primedia has owned the rentals.com domain for some time now.
I don’t have access to older domain name information. I know you can get that information by paying extra at places like http://www.domaintools.com/, is that where you got the domain information Industry Vet?
Interesting that you mention Classified Ventures and Trader, do you have any inside information if these two companies plan on purchasing other sites?
Rentals.com has actually been an operating site and service. It basically was templated websites for properties.
No inside info, just know that both companies are focused on the Rental market and consider the small rentals category a growth opportunity now that they have a solid foothold on the large Multi-family market.
I found something that might be of interest:
http://selfemployedworker.com/node/998
It is from Sept of this year.
With boom in second homes, vacation rentals will be a big business and as long websites focus on increasing revenues of property owners, there is going to be significant value that will be added and hence this consolidation could be pre mature