U.S. directory and local search player The Berry Co. has scooped up defunct search marketing firm WebVisible’s Geneva platform from a liquidator in the wake of that company’s collapse.

“This acquisition will dramatically enhance our presence and capabilities in the digital local search space,” said John Fischer, interim president and CEO of TBC Holdings and Berry. “We plan to take the best of the Geneva technology and create a new platform and leads optimization engine that meets the ever-changing needs of advertisers across a range of digital products. We are delighted with the exceptional range of software development and product management talent represented by the employees of the new company.”

Berry has set up a separate business, based in Playa Vista, California, to operate the platform. One of the main reasons for the arm’s-length relationship is that the WebVisible business was based on reseller relationships, some of which Berry will maintain, while longer term Berry has ambitions to develop the technology further and possibly seek additional customers for the platform. This would be difficult if the operation were nested within the Berry organization. Essentially, Berry will become a customer of the new entity.

In addition to the technology, Berry has taken on 14 engineers and a few product specialists to help operate the platform.

Eric Owen, Berry’s VP of digital strategy and partnerships, told BIA/Kelsey that the WebVisible platform had several attributes that Berry found compelling, among them its dashboard capability, call tracking network and an order entry and ad insertion system with billing functionality. That latter is critical to helping Berry provision more digital products.

And moving more digital products through the pipeline is key to Berry’s longer term strategy, which involves provisioning multiple lead generating products and tracking the performance for the customer.

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The search marketing firm WebVisible was abruptly closed down by its creditors over the holidays, with CEO Ron Burr managing only to convince the company’s lenders to wait until after Christmas to foreclose on the business. As of Dec. 27 the company no longer exists, and its employees (estimated at 130 back in March but likely fewer at the end) were left with little to do but go home to wait for their final paychecks to arrive in the mail.

In an email to employees, Burr explained the company’s demise this way:

It is with deep sadness and regret that I must inform you that today, December 27, 2011 is the last day of operation for WebVisible. I know this is a shock and has come abruptly. Even with all our efforts to recover throughout this past year, we found ourselves in a position in which the debt load of the company was simply too much to overcome. Our bank foreclosed on its loan which means they are taking over the company’s assets and collecting all remaining payments. As a result they have forced the company to shut down. We proposed many different options, attempting to negotiate with the bank, trying to find some alternative, but they are simply not open to alternatives. This happened quite suddenly, and the timing could not be more unfortunate.

Back in March, we talked to Burr about his vision for WebVisible. He had taken over the leadership of the company six months earlier from founder Kirsten Mangers. At that time, Burr insisted the business was generating about $25 million in revenues and was poised for sustainable growth. He said WebVisible made some “expensive mistakes” in focusing WebVisible on a direct to SMB model rather than on serving its reseller partnerships. Burr refocused the business on its partners, but apparently he wasn’t successful in generating enough revenues to service the debt and keep the lenders happy.

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SMB reseller WebVisible went through difficult changes last year, downsizing from 320 to 130 employees and retreating from an ambitious direct marketing program. But it has kept core partners intact; key members of the CEO’s installed executive team have stayed intact; and the company has aggressively ramped up its technology program. It is now poised for sustainability and growth, according to CEO Ron Burr, who took over from co-founder Kirsten Mangers last September.

“We made some expensive mistakes on the direct business,” says Burr, former head of NetZero, who joined WebVisible last year. “We took our eye off the ball on our partner business. But now we are refocusing on our channel partners.” In addition to keeping key accounts such as McClatchy and BT, WebVisible recently won the account for Recruit, a $10 billion Japanese company with 12 media properties.

Burr notes that all through the strife, the company has maintained revenues of roughly $25 million. Roughly 70 percent of revenues were U.S. based, and 30 percent were international. This year, the ratio should be 60 percent U.S., and 40 percent international. There should also be 10 percent revenue growth in 2011.

The growth is partially attributable to the rollout of a more efficient, cloud-based tech platform, and new technology that allows the company to “understand the effectiveness of particular keyword structures in a campaign, and how they concert to action by consumers, whether phone calls or clicks. The tech results in a 30 percent increase in effectiveness,” says Burr. WebVisible is also focused on providing customers a centralized database for local advertising, whether it is tracking Groupon, clicks or e-mail marketing. “It all needs to co-exist,” says Burr.

“The interesting thing about the pure plays in this space … ReachLocal, Yodle and WebVisible … is that nobody’s made it to profitability,” adds Burr. “That’s the tack we are taking now. Run this company profitably with a viable business strategy.”

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As the demand for dependable call-tracking tools intensifies in the SMB marketplace, WebVisible — the Irvine, California-based local online marketing provider — has unveiled upgrades to its portfolio of services to enable more focused ad geotargeting and greater call-tracking capabilities for businesses.

WebVisible has boosted its Geneva Platform to serve locally targeted ads for its clients across all search engines. CEO Kirsten Mangers told BIA/Kelsey that not only will SMBs be able to calculate their advertising radius across an entire city or ZIP code, but they can also “drill down to individual blocks within the radius to focus their marketing efforts on high or low penetration areas.” 

Enhanced geotargeting feeds into call-mapping features provided by the company’s Merchant Center 1.6, giving clients smarter tools to distinguish “bona fide leads” from peripheral ones. 

Mapping shows advertisers exactly where calls are originating from within their radius. The platform is interactive, so SMBs can then grade calls in order to earmark effective leads and block unwanted calls. They have the autonomy to say “what is a good call and what isn’t.” WebVisible then can apply its algorithm on the back-end to adjust marketing campaigns for more efficient bidding and targeting. And, as dictated by its SMB partners, it can also create alerts tied to their call blocks.

The entire suite is designed to, as Mangers put it, address “the elephant in the room” for call tracking and pay-per-call providers: distilling qualified leads from irrelevant ones. Easier said than done, she reminded us, because what is “bona fide” to one business may not be to another. Only when this issue is definitively resolved can SMBs, resellers and agencies all evolve to true transaction-based, performance-based models. 

Yext has already introduced voice recognition and processing technology to help merchants better understand their leads, a developing sweet spot for WebVisible, too. Mangers said it would enable the company to scan voice recordings for a deeper contextual understanding of how to handle these calls, which is pivotal in addressing online churn. 

Mangers also updated us on new partnerships that WebVisible is brokering. The firm has several deals brewing in Asia and is redoubling efforts outside the U.S. because “publishing partners are 18-24 months behind us in creating viable online products” (though many are ahead in mobile). It announced a partnership with McClatchy Co. in April in which the newspaper conglomerate plans to fully integrate WebVisible’s marketing platform across its 29 markets by the end of 2010 to bolster local sales.

As for location-based mobile services, Mangers personally is an eager early adopter but cautions against putting cart before horse until the market matures to a greater level of standardization in which reach can be gained through more aggregated, trackable distribution. “App-vertising” is an important future initiative, but in the meantime, it’s “back-to-basics” for SMBs, with some handy new tools in their kits.

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ReachLocal went public today, raising $54.6 million on the Nasdaq from the sale of 4.167 million shares at $13 each. The share price had been sharply cut from earlier hopes of $17 to $19 given pessimistic market conditions. But the offering closed at $14.98 a share, up 15 percent in a sharply down day for the Street.

Whether prices hold up and lead to IPOs from similar SMB ad resellers/engagement companies such as WebVisible, Yodle and Orange Soda remains to be seen.

One complaint about all of them is that they’re low margin, high cost players, especially given their needs for large sales forces. In recent comments to the IAB, Jordan, Edmiston Group Co-President Tolman Geffs characterized ReachLocal as a vertically integrated play that only leaves 7 percent of its revenues to support its product and platform, after spending 55 percent on consumer traffic and 38 percent on sales and marketing.

But Yodle CEO Court Cunningham says that comments like Geffs’ totally miss the point of the business. “It isn’t about percentage. It is about dollars and cash flow,” he says. The margins are not dissimilar to major companies like Amazon. Amazon’s margins are 3.5 percent, but it brings in $1 billion a year. Cunningham cautions, however, that Yodle has no immediate plans to go public.

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ReachLocal says it is going ahead with its IPO. A new filing with the SEC noted that it will price 4.8 million shares between $17 and $19, allowing it to raise between $81.6 million and $91.2 million — below the $100 million it originally wanted to raise. If the IPO is successful, it may be followed by IPOs from WebVisible, Yodle and Clickable.

Prior to the filing, doubts have been raised whether ReachLocal’s IPO would see the light of day. While Reach’s revenues have been strong, from a typical base of 15,000+ customers, churn rates suffered throughout the industry have raised concern. Google’s recent efforts to cut back on markups charged by third-party resellers like ReachLocal hasn’t helped either.

But ReachLocal has been enhancing its appeal to SMBs by broadening its range of paid and organic services in creative and valuable ways. In March, for instance, it purchased SMBLive, a business profile and Web site service, for $8.5 million.

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McClatchy Co., the third-largest newspaper entity with 30 newspapers in 29 markets, including The Miami Herald and The Sacramento Bee, will aggressively target SMBs in each of its markets via an extended deal with WebVisible. The deal, per release, “will help local advertisers provide the most efficient way to get found by customers no matter how they’re looking — in newspaper listings, newspaper web sites, or search engines, or via mobile phones or navigation devices.”

The company has had a long relationship with WebVisible, offering services in Kansas City; Tacoma, Washington; and Fresno. But now it is pulling out all the stops. Anchorage and Charlotte have already been added; the next phase will include Boise, Miami and Sacramento. By December, the rollout will encompass all 30 daily newspapers in 29 U.S. markets.

James Calloway, McClatchy VP of strategic development, tells us that McClatchy’s sales forces have seen a dramatic increase in advertisers demanding help for getting into search marketing. “There is a learning curve. It is a different state of mind,” he says. But McClatchy’s papers that have been working with WebVisible have “done well.”

Calloway says a key to getting it right has been to offer advertisers an option of going with either a guaranteed click model or a budget based model offering a range of services for a fixed amount. Over time, he sees the guaranteed model fading. But “we basically need to cover it,” he says.

Calloway’s gut feeling is that the offering will take some time to develop in each market, but that it will get decent numbers from the get-go and will continue to grow over time. It will be part of a broader package, he says. The WebVisible effort is being supported by McClatchy’s five-person local market development team, which is based in Miami. They work on a a SWAT team basis, in which they hit a market, get it going and move on to the next one. They are tasked with in-market sales training and ramping up revenues.

WebVisible recently raised $20 million, and has raised more than $37 million in all, as it competes against other third-party SMB sales companies such as ReachLocal, Yodle, Marchex and Orange Soda.

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The money is moving quickly into the third-party SMB reseller space. ReachLocal has applied for a $100 million IPO, which could go out this spring. In hopes of similar paydays, its rivals are raising hordes of cash. Yodle, for instance, has announced that it has added $10 million, boosting its total amount raised $38 million. And now WebVisible has announced a $20 million round, making its total amount raised $37 million.

According to paidContent, the new round was led by Adams Street Partners, a Chicago-based PE firm. WebVisible’s last round, for $12 million, was led by Sutter Hill Ventures, with previous backer Redpoint Ventures.

WebVisible CEO Kirsten Mangers tells us that she would certainly claim certain competitive advantages over ReachLocal. But Reach’s “explosive growth shows that the market is solid; it is really good green field. Local interactive is the emerging field in interactive,” she adds. “Wall Street will show its support of the business mode.”

While WebVisible doesn’t disclose earnings, Mangers notes that it had 113 percent year-over-year growth in 2009, and a client roster of 40,000 to 45,000 active SMBs. More than 100,000 accounts have worked with WebVisible at one time or another. Top partners include AT&T, Intuit and BT.

WebVisible has also greatly boosted its presence in its size and international presence, with operations in Europe and Australia. Several international deals are pending, adds Mangers. It is also investing heavily in its “Geneva” (i.e., neutral) technology platform.

With the rise of mobile, WebVisible has been especially focused on building “multi-media, multi-device and multi-persona” capabilities that can effectively reach users in different places and dayparts,” says Mangers. “Local is where the consumer says it is.” While mobile is still a minor piece of the puzzle, Mangers predicts “it will be a rather high percentage in the course of the next 24 months.”

But, she emphasizes,  it is important not to get too far ahead of the cart. “So many SMBs still haven’t tipped their toes into the search waters yet.”

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ReachLocal, the fast growing search and display sales channel for small businesses with operations in the U.S., U.K., Canada and Australia, has filed with the SEC to raise $100 million in an IPO. The company recently reported that it has 500 + salespeople and 300 staffers.

Reach earned $146.7 million in revenues in 2008, up from $68.4 million in 2007. It had a net loss of $7 million in 2008. It has raised more than $60 million, including $55.2 million two years ago, when it was rumored to be valued at $305 million.

The IPO, assuming it goes out, will be closely watched by other SMB sales companies that may pursue a similar route, including WebVisible, Yodle, Clickable, Matchcraft, Orange Soda and others. Marchex has been public since 2004.

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