LAS VEGAS, NV (January 9, 2019)IZEA Worldwide, Inc. (NASDAQ: IZEA), operator of IZEAx, the premier online marketplace connecting brands and publishers with influential content creators, announced that it has entered into a non-binding letter of intent (the “LOI”) at CES 2019 in Las Vegas, Nevada. The LOI outlines certain general terms for the proposed purchase by IZEA of all the outstanding shares of FLUVIP Ventures, SL (“FLUVIP”), the leading influencer marketing company of Latin America.

FLUVIP provides influencer marketing and custom content solutions to brands and agencies throughout Latin America and in the U.S. Hispanic Market. The company is headquartered in Bogotá, Colombia, with subsidiary operations in Brazil, Mexico, Peru, and Argentina. FLUVIP operates multiple technology platforms including Influtech, AdvocatesPro, and Mediadata. The company has established a network of more than 100,000 opt-in influencers throughout Latin America and the U.S. Hispanic market, ranging from micro-influencers to some of the largest influencers in each country. Investors in FLUVIP include Cisneros Group, Telefonica (Wayra), Velum Ventures, and The Venture City, who would become shareholders in IZEA post transaction.

“We believe that there is a significant opportunity for international consolidation in the Influencer Marketing space,” commented Alfonso Gómez Palacio, Telefonica’s Director Hispam North, “This transaction brings together the leading influencer marketing platform in the United States with the leading platform in Latin America. The combined company will be well positioned to serve large brands and agencies in both regions, while establishing a software and services infrastructure for further global expansion.”

From left to right : IZEA COO Ryan Schram, IZEA CEO Ted Murphy, FLUVIP CEO Sebastián Jasminoy, FLUVIP CRO Juan David Ramírez

The transaction contemplates that FLUVIP will become a wholly-owned subsidiary of IZEA. Consideration paid to shareholders of FLUVIP will be in the form of cash and IZEA stock paid or issuable at closing and over a trailing 36-month period subsequent to the closing, with potential additional consideration tied to future FLUVIP operational performance metrics.

“We are excited by the potential to unite FLUVIP with IZEA to form a truly unique technology and services platform catering to marketers and influencers across North, Central, and South America,” said Sebastian Jasminoy, Founder and CEO of FLUVIP. “The combination of our companies can enable us to innovate faster by concentrating our engineering resources on a single solution for our joint customers and to realize economies of scale otherwise nonexistent in our industry.”

“There is global market demand for both influencer marketing and custom content for brands. IZEA intends to continue strategic consolidation among the best-in-class providers in our industry with an eye on accretive revenue and technology assets,” said Ted Murphy, Chairman and CEO of IZEA. “The acquisition of FLUVIP would expand our footprint to cover all the major advertising markets in the Americas — from Canada to Argentina. In addition to strong relationships with brands in Latin America, IZEA would be uniquely equipped to service the world’s leading multi-national brands with a single influencer marketing platform that reaches a significant portion of the western hemisphere.”

IZEA’s Strategic Interest in FLUVIP

Revenue Growth

  • Ability to service large multi-national clients through both software and managed services with deep cultural understanding and domain expertise in key markets throughout the Americas.
  • Aggressive sales expansion into a developing market with significantly less competition and market fragmentation in both influencer and content marketing.
  • Unique value proposition for customers targeting the U.S. Hispanic Market with Latino influencers.

Software Platform Innovation

  • Integration of key FLUVIP technologies and processes into IZEAx.
  • Consolidation of platforms to allow new feature development to move forward at a more aggressive tempo.
  • Support for multiple currencies and languages to serve the Latam market.

Long-Term Cost Savings Opportunities

  • Ability to significantly lower IZEA’s average cost per engineering man hour by establishing an off-shore engineering presence.
  • Create operational efficiencies throughout the FLUVIP organization by way of technology enabled workflows and payment processing
  • Reduction of ongoing platform infrastructure and maintenance costs by moving to a single platform.

Based upon unaudited information provided by FLUVIP to IZEA, the company’s revenues for the year ended December 31, 2017 were approximately $9.0 million. Net loss for the year ended December 31, 2017 was $987,000. FLUVIP’s financial information has not yet been audited, may not comply with U.S. GAAP standards, and actual numbers may be materially different from what was provided and reported herein. FLUVIP’s revenues are comprised primarily of managed services fees, with a growing base of customers licensing their software.

Consummation of the transaction contemplated by the LOI is subject to due diligence and the execution and delivery of a definitive acquisition agreement along with the satisfaction of the closing conditions which will be contained therein. It is contemplated that the acquisition will be consummated in May 2019, but there can be no assurance that a definitive agreement will be entered into, or that the acquisition will be consummated upon the terms set forth in the LOI, or otherwise. In the event that the acquisition is consummated, there can be no assurance that it will ultimately prove to be beneficial to IZEA.

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