For those with the urge to unearth and discover their roots, Ancestry.com helps people research and share family histories, as well as create family trees. Its more than 2.5 million subscribers can search a variety of documents, photographs, maps, and newspapers on its website. Ancestry.com relies on user-generated content and social networking activities, such as uploading family trees, written stories, and photographs, to encourage collaboration among users. The company also provides family-history desktop software Family Tree Maker and offers research services. Its properties include Archives.com, 1000memories, Fold3, and ProGenealogists. Ancestry.com was taken private in late 2012 by Permira.
Change in Company Type
A consortium led by the European private equity firm Permira purchased Ancestry.com for some $1.6 billion in late 2012. The consortium of investors also includes members of Ancestry.com's management and venture capital firm Spectrum Equity. Its new owners plan to expand the service in Western Europe.
Ancestry.com's primary strategy is to grow its subscriber base in the US and worldwide by catering to a loyal base of existing subscribers and by attracting new subscribers. As part of this effort, revenues have risen from $166 million in 2007 to $487 million in 2012.
To its benefit and part of its strategy, Ancestry.com subscribers have created more than 40 million family trees containing about 4 billion profiles. They have also uploaded more than 95 million pieces of content, such as photographs, scanned documents, and written stories. The company focuses on growing its subscriber base by adding new content and tools, improving marketing efforts to increase brand awareness, and expanding internationally. Ancestry.com has also focused on developing its technology to synchronize between platforms, such as online, mobile devices, and its Family Tree Maker desktop software. Ancestry.com has also invested some $15 million in a new AncestryDNA service that it launched in 2012. The service pairs those who take a DNA test with Ancestry.com subscribers in the company's effort to become the world's largest online family history resource and a broad global database of DNA samples. In 2012 it also launched Newspapers.com in the US to offer customers historical and current newspapers ranging from the New York Times to small and local editions.
Ancestry.com's international growth has been the result of the 2010 acquisition of Genline AB, the Swedish market leader in genealogy and local heritage research. The year before, Ancestry.com launched Mundia.com, a global, multilanguage family-history networking product. And in 2008 the company launched Chinese family history website Jiapu.com.
Mergers and Acquisitions
The company's content sources include digitized archives of publicly available US and UK census records and other government documents, historical societies, religious institutions, and private collectors of historical content. The company continues to add new content through acquisitions. In 2012 it acquired Archives.com, a family history website, for approximately $100 million, as well as 1000memories Inc., based in San Francisco. The startup, which brought with it the ShoeBox app, helps people digitize and share an estimated 1.7 trillion paper photos stores in their albums, attics, and shoeboxes.
It purchased professional genealogical research firm ProGenealogists in 2010. ProGenealogists specializes in genealogical, forensic, and family history research. The company's purchase of iArchives for nearly $32 million in 2010 gave Ancestry.com a digitized service provider and Footnote.com, later rebranded as Fold3.com in mid-2011 as a website focused on US military records.
Ancestry.com posted significant revenue increases of 33% in 2011 as compared to 2010. Several factors contributed to the rise, including subscription revenue increases due to a boost in the number of total subscribers, more average monthly revenue per subscriber, increase in iArchives digitization services revenue, and more genealogical research services revenue generated by its ProGenealogists product, as well as a sales bump from its Family Tree Maker. Ancestry.com's net income rose as well (by some 70%) during the same reporting period. The company attributes the rise to a decrease in interest and other expenses, as the business had no outstanding debt throughout 2011 until the last month of the year, when it borrowed $10 million under its credit facility.
Most of Ancestry.com's revenue comes from subscription fees generated by about 2 million paying subscribers.
Sales and Marketing
Boosting its marketing efforts to increase brand awareness, the company has strategically developed a branding partnership with NBC in the TV show Who Do You Think You Are? The US version of the BBC television series began airing on NBC in 2010, tracing the family histories of celebrities, such as Sarah Jessica Parker, Lisa Kudrow, and Spike Lee. Part of the product integration includes a co-branded Ancestry.com website developed in cooperation with NBC. The high-profile nature of Ancestry.com's marketing efforts reveal its competitive advantage as the dominant player in the online market for family history.
Ancestry.com logged an additional $28.4 million in marketing and advertising expenses in 2011 vs. 2010 primarily due to a $25.8 million increase in TV advertising and sponsorships. Focused on domestic and international markets, the company worked to promote its business despite higher media rates as it banked on the successful results of a second season of promotion vehicle Who Do You Think You Are?
From its headquarters in Provo, Utah, Ancestry.com has operations in both San Francisco and Silver Spring, Maryland. With a global reach, the company also maintains offices in the UK, Canada, Australia, Germany, and Sweden.
Ancestry.com was founded in 1983 and went public in 2009. In addition to paying down debt, the company used proceeds from its IPO to expand through acquisitions and investments.
Private-equity firm Spectrum Equity Investors owns some 31% of Ancestry.com along with Spectrum Equity managing director Victor Parker with 22%. Manulife Financial Corporation holds another 10% stake.