Plaxo's For Sale
Plaxo, the Sequoia-backed start that transformed itself from a hated spam monster into a mild mannered and interesting business social network, has started a sale process according to a source. They've hired an investment bank, Revolution Partners, who are spearheading the sale effort.
Context & Ripple Effects
Plaxo spent 2007 remaking itself: after years as an address-book sync tool with a spammy reputation, it pushed into social networking with a mid-2007 overhaul aimed at catching up with LinkedIn and Facebook, shipped Plaxo 3.0 unifying desktop and web PIM, and closed the year by bringing its Pulse feed into Microsoft Outlook. Along the way TechCrunch reported talks with Xing about an acquisition back in June 2007, so a sale has been in the air before.
The new report — that the Sequoia-backed company has engaged Revolution Partners to shop it — arrives as a sourced claim rather than a confirmed deal, but the New York Times picking up the same story on the day signals how widely it travelled. If accurate, the 2007 product pivot reads less like catch-up and more like positioning the company for buyers.
First-order effects
- Sequoia gets a path to liquidity on a seven-year-old portfolio company whose core sync business never became a standalone franchise, while Plaxo's staff faces ownership uncertainty mid-pivot.
Second-order effects
- Strategic buyers in business social networking — the space where Xing already explored a deal in 2007 — now have a formal process to bid into, forcing rivals like LinkedIn to weigh whether Plaxo's Outlook-installed base is worth buying or neutralizing.
Third-order effects
- If the pattern holds, standalone contact-sync and PIM layers get absorbed into larger social platforms, ending the era when an address-book utility could survive as an independent company.
The trend: Standalone PIM and contact-sync startups are consolidating into social networking platforms, with 2007's feature pivots doubling as pre-sale positioning.