Zagat for Sale

The NY Times reports that Zagat and its proliferating family of ratings guides is now for sale:

The Zagat family has hired Goldman Sachs to seek a buyer for the company, which since its founding almost three decades ago has become part of the global culture: the company sold 5.5 million guides last year in more than 100 countries and has a Web site with 1.5 million registered users.

There are two, overlapping versions of why this might be happening:

  • Time to find new leadership that can “take the company to the next level” (plus the founders may be tired and/or ready to move on to new projects)
  • Time to sell because the value of the company can only go down in its current form

Zagat, the original user-generated content forum, has been expanding aggressively into mobile and doing consumer advertising to bolster its brand. But free alternatives to its flagship restaurant guide put pressure on the brand (and more importantly the subscription model) over the long term. Thus now is probably the right time for the founders to cash out accordingly.

By the same token the brand is trusted and valuable, and another company might really benefit from owning Zagat. The NY Times speculates that IAC or News Corp. might want the company. Certainly there will be a buyer. The only question is the price.

4 Responses to “Zagat for Sale”

  1. Local SEO Guide Says:

    I wonder if the Times themselves might not be a good buyer? They seem to like the print business and this fits right in with their demo sort of.

  2. ian Says:

    even if everybody came into work at zagats and slept all day long they’d be generating significant cash flow for the foreseeable future.

  3. Greg Sterling Says:

    I suspect that’s right; it probably would be a good fit.

  4. ian Says:

    i want to work at zagats so i can sleep all day!

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