TheStreet.com Diversifies Away From Cramer With Stockpickr Acquisition

Some time ago, we mentioned Stockpickr.com. I just noticed that the firm was acquired by TheStreet.com (TSCM) a few weeks ago.

This is very interesting, and for a number of reasons:

1) Stockpickr is the largest social networking site dedicated to investing. It is also, to the best of my knowledge, the first vertical social networking site to be acquired period.

2) More interestingly, it is the first major acquisition done by TheStreet.com.

Henry Blodget (yes that Henry Blodget) made an interesting and perhaps related observation last week. (Note he and Jim Cramer do not seem to be fans of each other) Blodget wrote: "no one is talking about the biggest single risk-factor at any one company since Martha Stewart Living Omnimedia."

He has a valid point. In the post Martha-in-the-gray-bar-hotel era, any single individual overly identified with a company -- be it founder, spokesperson, or main personality raises some risk for investors. 

With the Stocpickr acquisition behind it -- and perhaps several others in the future -- we may be seeing a process where TheStreet.com is diversifying itself from that risk factor. That not only is good for TSCM's shareholders, but potentially  good for TheStreet.com, as they diversify themselves from being at risk from the Cramer-gets-hit-by-a-bus fear. It also improves the odds of someone else potentially acquiring TheStreet.com itself.

This is consistent with my prior views on TheStreet.com's stock in November 2005, and again in February 2006 and April '06.

~~~

Disclosure: I publish at TheStreet.com, but hold no equity interest or stock in TSCM.

Comments

[Malkiel:]

TheStreet.com has never been just a one-trick pony. After All, they let uber-bear Doug Kass write 3 columns a week, and seem to have a dozen other writers--I can go for a couple of weeks at a time not reading anything by Cramer on the site...

2007 May 08 10:59 AM

[jbs:]

Stockpickr is a good concept but the user experience leaves a lot to be desired.

They need a UI expert to come in and redesign that site ASAP.

2007 May 08 12:38 PM

[Frank Li:]

Couple of points:

- Didn't they buy the Weiss ratings business before this? I think they discussed this in the earnings call -- it's in the most recent transcript: TheStreet.com Q1 2007 Earnings Call Transcript.

- Looks like most of stockpikr's traffic comes from TheStreet.com itself, not organically. For example, James Altucher uses about half his links in his blog watch column on thestreet.com to drive traffic to stockpikr (which he started and owned), even though it's not a blog. (So much for disclosing conflicts of interest!) And TheStreet links to stockpikr after every mention of a stock.

- Word on the street is they only paid a couple of million dollars for stockpikr. The acquisition wasn't large enough that they had to disclose the sum paid on their conf call or in an SEC filing, so it definitely wasn't a "major acquisition", particularly given how much cash the company has.

Perhaps the low price was related to the lack of organic traffic.

2007 May 13 09:19 PM

[Ralph F:]

Was interested to hear what people think of the financial blog search engine TheStreet.com announced today:

<blockquote class="quote">NEW YORK--(BUSINESS WIRE)--TheStreet.com, Inc. (Nasdaq:TSCM - News), a leading provider of financial commentary, analysis, research, news and financial ratings, today announced the launch of StockBlogr, the first blog search engine devoted to accessing the top financial blogs on the Internet today that offer investment advice, information about specific stocks, and trading strategies.

StockBlogr posts are available in real time exclusively on thstreet.com and stockpickr.com.

A StockBlogr search returns the most relevant blog posts related to the search text (for example, "GOOG" or "Cramer") as well as links to relevant portfolios held by the professional investors tracked at Stockpickr.com and relevant videos from any of the major online financial video sites.

The combination of these resources within one search engine serves to increase stickiness to TheStreet.com's network of sites while delivering robust research options to users of the tool.

"StockBlogr stands out from other search engines currently available online," said James Altucher - President of Stockpickr.com, a wholly owned subsidiary of TheStreet.com. "It's what users want access to, on time, all the time - in an environment where they don't have to weed through clutter to find what they are looking for. StockBlogr is a reliable resource for consumers who would otherwise not have a clear path to the very tools depended upon by professional money managers to gain an edge in collecting timely information to make successful financial decisions."

For two years TheStreet.com has been the leader in delivering the best blog posts from the financial blogosphere, via its Daily Blogwatch column and from blogs by Jim Cramer and Jim "Rev Shark" DePorre. StockBlogr enhances the Company's ability to continue to share its expertise and command of the financial blogosphere through the thoughtfully selected compilation of content within the tool.

StockBlogr is also available at www.thestreet.com/blog....

Source: biz.yahoo.com/bw/07060...;/blockquote>

2007 Jun 04 11:58 AM