
Ancestry.com Acquired for $1.6 Billion - dsr12
http://www.theatlanticwire.com/technology/2012/10/ancestrycom-was-just-acquired-16-billion/58184/
======
GabrielF00
Ancestry.com is possible largely because of the Mormon church. There is a
religious obligation in Mormonism to proxy baptize one's non-Mormon ancestors
so they can get into heaven. To allow Mormons to identify these ancestors the
LDS church has spent decades going around the world and making microfilm
copies of birth, death and marriage records and the like. At one point when I
was doing genealogy research on the East Coast I went to the local Mormon
church's family history library and ordered a microfilmed copy of some birth
records from the Russian Empire in Yiddish and Russian. I could then go
through the microfilm and try to pick out the names I wanted.

Because much of the hard part (getting access to these archives and making
copies of these records) has already been done, Ancestry just has to scan and
OCR these records. My understanding is that Mormon volunteers do a lot of that
work as well.

~~~
tzs
> There is a religious obligation in Mormonism to proxy baptize one's non-
> Mormon ancestors so they can get into heaven.

That bugs me. I'm afraid of it going down like this. I die, and the Valkyries
select me for Valhalla. As I enjoy the afterlife there, knocking back flagons
of mead and knocking up wenches, while trading tall tales of valor with the
other chosen, there comes a knock at the door. A maiden answers, and then goes
to Odin and whispers something.

Odin frowns, and whispers something back to her. Now all eyes are on the
maiden as she walks back to the door, and invites in two Mormons. She leads
them to Odin, and they hand him some paperwork.

Odin summons me, and tells me that they are from Mormon Heaven. He tells me
that my half great great great great great grand niece has converted to
Mormonism, found me in their ancestry records, and baptized me into the Mormon
Church--and that I must leave Valhalla and move to Mormon Heaven. No more mead
and wenches for me. :-(

~~~
danielweber
Starting with the assumption of an afterlife, this would be a pretty crazy way
for it to work. Can another descendant get you transferred back to Valhalla?

I understand the offense you can feel at finding out a loved one got baptized
post-mortem into a religion they didn't believe in, but if the living could
get the dead kicked out of any sort of heaven it would be essentially not be
an afterlife.

~~~
andyjohnson0
I suspect that @tzs was not being entirely serious

~~~
hkmurakami
But this _is_ how child custody works... =\

~~~
pyre
If I baptize a child in 'my' religion, then I get custody? Then my ex-spouse
baptizes into his/her religion, and custody again changes hands?

~~~
hkmurakami
I was referring more to the paperwork :P

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IsaacL
Looks like a classic example of a huge market that young techies think isn't
important. I don't know anyone my age who has an account on ancestry.com or
who cares about their family tree, but I have lots of older (and richer)
relatives who do.

Pet owners are another example. Apparently some of those "facebook for dogs"
sites are doing pretty well, since the dog owners who use them tend to be
middle-class and middle-aged - a huge market that most tech startups ignore.
Think different!

~~~
objclxt
I had the pleasure of being next to some of the engineers from Ancestry.com in
the queue for the WWDC keynote this year - it was really interesting to hear
about a business that you don't think is that big, but is actually _massive_.
They said Europe was also a very big market for them (I know genealogy is
quite popular in the UK at least - the TV show that the article cites, 'Who Do
You Think You Are', was originally a BBC show first), so being acquired by a
European private equity firm makes some sense.

~~~
chaostheory
I just wish Ancentry would spend some time and resources for the Asian market.

~~~
mc32
That's probably an opportunity for someone to pick up. Keep in mind that the
data is more easily obtainable thanks to the household registries
institutionalized in East Asia [<http://en.wikipedia.org/wiki/Hukou_system>]
which record familial information such as parents, professions, dates,
residence changes, etc.

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jpdoctor
Anyone seen actual financials? FTA: _To monetize all that information, the
website has a subscription model that two million people pay into at $12.95 to
$34.95 a month, according to the company._

So (say) $20/month = $200/year * 2 million = $400M/year run rate. In rough
terms the buyout happened at 3-4x revenue.

I'd say it's not too rich a valuation, and given my wild-ass guess above, my
error bars are big; But the bottom line: not an insane number.

Kudos.

~~~
jcampbell1
You sir are a fantastic estimator. The company is public, and their financials
are available at:

[http://finance.yahoo.com/q/is?s=ACOM+Income+Statement&an...](http://finance.yahoo.com/q/is?s=ACOM+Income+Statement&annual)

$400M is very close to the actual audited number for last year.

I have zero idea why the author failed to mention that is a bid to take an
already public company private.

~~~
dx4100
$162M operating expense? Is that normal?

~~~
jcampbell1
$122M on marketing. They have big TV ad campaigns.

They spend $85 to acquire a subscriber.

see:
[http://ir.ancestry.com/secfiling.cfm?filingID=1193125-12-677...](http://ir.ancestry.com/secfiling.cfm?filingID=1193125-12-67710)

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taylorbuley
_"Basically, it's a lot more money than we would have expected for a website
all about family trees."_

This post is bad technology reporting, and terrible business reporting.

~~~
mikescar
Bad grammar throughout but yes, just incredibly lazy.

>"It does sound like the site has offers more than a lot of other Internet
things these days."

Good god, this is the Atlantic. At least they could act like they're trying
instead of just getting something out quickly for the pageviews.

Edit: a quick author search shows a ton of this half-assed blogging. Won't be
going back to the Atlantic Wire any time soon. (
<http://www.theatlanticwire.com/authors/rebecca-greenfield/> )

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djloche
Here's an article that has a little more depth and fewer Instagram references.

[http://descrier.co.uk/technology/2012/10/ancestry-com-
acquir...](http://descrier.co.uk/technology/2012/10/ancestry-com-acquired-by-
private-equity-group-for-1-6-billion/)

>"The buyout group includes the private equity firm’s co-investors, members of
Ancestry.com’s management team, including CEO Tim Sullivan and CFO Howard
Hochhauser, and Spectrum Equity, which already owns about 30 percent of
Ancestry.com."

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Xcelerate
"Ancestry.com has been acquired by European private-equity firm Permira for
$1.6 billion, which is a little over 1.5 Instagrams"

Is "Instagram" the new word for a billion? I like it. It sounds like a unit of
measurement.

It will be interesting to see how this grows. Some of my family members are
very into family history and genealogy and want to get their DNA tested as
well to see where we are from. If nothing, it's a good way to at least pique
the curiosity of a large population, so I can see it going for as much as it
did.

~~~
Steko
Funny when I read it I was wondering if it shouldn't be more like 2-3
Instagrams at current FB stock price but I guess it was never said how much
was in cash.

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byefruit
It sounded like a lot but then you do the maths:

"To monetize all that information, the website has a subscription model that
two million people pay into at $12.95 to $34.95 a month, according to the
company."

So even at a lower bound that's close to $26m/month in revenues or $312m a
year. So it's only 5x revenues.

~~~
AdamTReineke
Wikipedia says that they had $13.67B in capital in May. A 12% bet that upper-
and middle-class baby boomers will keep spending at that rate for at least the
next 5 years? Somebody must be confident.

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webwanderings
Someone has already shared this <http://news.ycombinator.com/item?id=4682222>

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thechut
I see this as a larger play. As the internet generation gets older many more
people will have almost their entire life online making the information
Ancestry.com can provide much greater and more detailed family trees.

~~~
NikP
and the more info online, ie more Facebook timelines, the integration with
Ancestry style services is in a way inevitable.

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charleshaanel
Subscription revenue model that offers a certainty premium for investors?
check

Tap into a deep psychological Maslow-style need that potentially hundreds of
millions if not billions have (aka the desire to know where we come from, who
we are connected to)? check

Future plans to possibly pivot itself towards being a platform that other
developers can build apps on that tap into its genealogical data? check

Looks like it could turn out to be be a bloody good deal!

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haukur
In Iceland we have something similar, but free:
<http://islendingabok.is/English.jsp>

I sometimes use it to check if people I meet are closely related to me. Pretty
much any two Icelanders are relatively closely related. It's a small island
with an even smaller population, mostly descended from the original settlers.

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pitt1980
what's the incentive to stay a subscriber?

why wouldn't people sign up, look at their information, then cancel their
subscription?

how do you know if they have anything relevent for you prior to you signing
up?

seems like the same thing with Angie's list, living in flyover country, how do
I know if there are any reviews worth paying attention to prior to signing up?

~~~
pcrh
I know someone who uses Ancestry.com. You can add as many details about your
relatives as you want, upload copies of wills, photographs, etc. A bit like
facebook for the dead :-/

Any of your friends or relatives can (by invitation) also view the history of
your family that you have generated, for free. They can also receive emails
when you update, with links to the new information. If you are really
investigating your family, you will have updates every few weeks to months (at
least my relative does).

Discussing family is a very popular topic for many people. Extensive family
histories might not work for many Americans, who often can only trace their
history back a few generations. Many in Europe however can easily trace back
to the 1600's or 1700's, when Church records started being kept. This of
course varies by country, Ireland, for example has few records earlier than
1800.

~~~
dmckeon

      > A bit like facebook for the dead :-/
    

How long until Google announces "Street View for Cemeteries"?

Start with whatever paper or digital records are available for each cemetery,
then scan each area of the cemetery, with multi-spectral cameras mounted on
gyro-stabilized (like a Segway) mobile platform.

Index by matching cemetery records to gravesite locations. Try to do OCR / ICR
in real time to cross-check / ground-truth the imaging process. Publish images
similar to Street View that allow pan/tilt/zoom and 'try to OCR'.

Include searches that can combinate text, OCR, and Soundex sets of names, and
search for for 'anyone else with similar names nearby'.

~~~
pcrh
In a sense, Ancestry is doing something similar. We are all related at some
point in the past (more recently if we are from the same country, less so for
Americans with their high rate of immigration). My relative has succeeded in
joining our family tree with that of people we had no idea existed, because
one of their family members uses Ancestry.com. My relative can now see their
family tree, including pics of gravestones, etc.

So, if you are into that kind of thing, it suddenly becomes interesting to
know that you are related to this or that famous or semi-famous person. Such
connections are increasingly likely (and vicariously ego-boosting) the more
people join and the more research they individually put into documenting their
family history.

~~~
onwardly
Sounds like a great network effect that boosts the usefulness of the site as
more people join.

~~~
pcrh
Agreed. My family history spans 3 continents, so tracing the people gives a
very personal connection to history. Who knows what could be revealed as the
site grows?

However, I do warn my relative, who has spent much effort on this endeavor of
hers, and shared it with Ancestry.com, while paying for the privilege to do
so, that she should keep all the things she finds through Ancestry on paper
and in other formats for herself, and not to rely on Ancestry to maintain that
information for the time spans she is used to dealing with. Fortunately, as
someone who gets frustrated when a particular lead into the life of some
obscure distant family member turns cold because of missing documents, this
isn't too hard.

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smackfu
It used to be that there were records websites and family tree websites /
software. Combining them is a win/win: records access has more value so higher
prices but no need to keep subscribing, while family tree sites emphasize
longer subscriptions to keep your tree online. Both Ancestry and MyHeritage
are now going to this model from opposite sides.

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ABS
if you are interested: John Esser, Director Engineering at Ancestry.com, is
participating in a webinar next week about how Ancestry.com implemented Agile
and Continuous Delivery (disclaimer: yes, he will also talk about how they
used ThoughtWorks Go in the process): <http://www.thoughtworks-
studios.com/content/go-user-group>

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arbuge
Things move fast... I was reading an article about how they just acquired
Archives.com from the Monahan brothers for $100m in August.

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OldSchool
Well, I have to admit it's probably a fair price, about 3x-4x revenue.

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kine
This has the potential to be huge for Mocavo

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drbillnye
worth noting there are more searches for genealogy type terms than for porn.
/files in the whoda thunk category

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bravoyankee
I think Ancestry.com is worth the 1.6 Billion. I have ancestry in Poland and
the Ukraine and doing research can be tricky. Ancestry.com was the go to
source for me. Amazing resource.

However, the current pricing is prohibitive. A year's full access was almost
$400, and that was nearly 10 years ago. I hope they lower their price. I'll
sign up again if they do.

~~~
jetti
If you are looking to expand your research, I would suggest Family Tree DNA.
It can test the paternal or maternal lines to get ancestry. I did the paternal
tests since my dad was adopted and didn't know his ethnicity and it was really
neat to find that his side is from the Balkans after migrating from East
Africa (oh and that I might be an ethnic Jew as well).

~~~
bravoyankee
Sounds enticing, and it might add another dimension to my research. Thanks!

