It looks like another social media marketing company may be close to getting acquired. We have been hearing a rumor for a month now that EQAL — which builds “influencer networks” around celebrities and brands — is being acquired by Everyday Health, a network of 25 health-related sites. The latest tip even pegged a price on the deal: $15 million, half in cash, and half in stock, plus up to an extra $5 million earnout for the founders based on performance.
This could be pure rumorware, but the multiple tips have us intrigued: contacted for comment, a spokesperson for Everyday Health said the rumor was “not true,” while EQAL’s spokesperson said, “We have nothing to confirm.”
EQAL has come a long way since being formed in 2008. Its creators were behind the lonelygirl15 and Kate Modern YouTube series, and EQAL originally was launched as an online video production house. In addition to Lonelygirl15 followup, it also produced Harper’s Globe, which was an online tie-in to the short-lived CBS series Harper’s Island.
But it wasn’t long before EQAL shifted into branded content and making web series for brand advertisers. It later started extending its work beyond just creating scripted online video content to helping brands create custom campaigns around products and celebrities. A good example of this is its collaboration with Kraft and Paula Deen to find the best Philadelphia Cream Cheese recipe. For these campaigns, it leverages not just YouTube, but social channels like Twitter and Facebook to connect with audiences.
With that in mind, it seems like there could be a lot of synergy between the two companies. Everyday Health, in addition to operating some 20 health and lifestyle websites — including the flagship EverydayHealth.com — also creates content for other platforms, like YouTube, to further the reach of those brands.
Everyday Health has its own weekly video series, Everyday Health TV, which pairs up former boxer Laila Ali with once-Survivor contestants Ethan Zohn and Jenna Morasca to discuss topics around health and wellness. EQAL’s fashion series “u look haute,” like Everyday Health TV, is part of YouTube’s original programming initiative, so the two have that in common as well.
Everyday Health could use EQAL’s social media delivery platform to grow viewership of Everyday Health TV, while potentially launching new shows based on its web properties. That could give it more video inventory to sell across its own publishing footprint and ad network, as well as on third-party platforms.
There is at least one other social media/media company acquisition that precedes this one, which points to how a merger between EQAL and Everyday Health would work. In August, the publisher Gannett bought BLiNQ Media to further its reach into social media-based advertising across its own digital footprint and on to other platforms like Facebook and Twitter. Gannett’s ambition, we were told by a source close to the deal, was to create its own version of the Washington Post’s SocialCode.
The market for companies specialising in social-media based promotion — creating content for social ad units, creating pieces of viral content that become like ad units in themselves, measuring and monitoring how well this works — is a pretty hot area right now, with platforms, enterprise services companies, and publishers all looking for a piece of the action. In addition to Gannet and BLiNQ, Oracle bought Vitrue ($300 million), Salesforce bought Buddy Media ($689 million), and Google bought Wildfire ($350 million) — among several other deals.
EQAL is backed by investors that include Spark Capital, Marc Andreessen, Ron Conway. It’s raised $8.5 million to date. Everyday Health, which once prepared for and then cancelled an IPO, has raised $153 million to date, with backers including Technology Crossover Ventures and Rho Capital Partners.