When Ben Rubenstein graduated from the University of Pennsylvania in May 2005, he joined his childhood friend Nathaniel Stevens, who had dropped out, to turn the online marketing venture they'd been working on in Philadelphia into a real business.
It was not going well.
"I was living on an AeroBed in a friend's attic," Rubenstein, recalls. "Every dollar we had went into the business."
Then the two met a local dentist who agreed to pay them $1,200 a month to optimize his website so it would appear at the top of local searches and capture information about interested customers. And that's when they knew they'd stumbled on something lucrative: doctors, lawyers, as well as other local businesses. That fall, they enlisted another childhood friend, John Berkowitz, to expand in Washington, D.C.
Eight years later, Yodle, which is now based in New York, has 30,000 customers, 1,000 employees, and revenue of $132 million a year. The company is on track to hit $180 million this year--which would make it the biggest company ever to appear on Inc.'s 30 Under 30 list. It has raised $38.5 million in four rounds of venture capital--the lead investor in the first round was Bessemer Ventures's Rob Stavis, who also put money into Skype and Yelp--as well as some debt financing.
In 2011, Yodle used some of those funds to acquire ProfitFuel in Austin, Texas, to offer less expensive online marketing packages that start at $150 a month (instead of $500) to smaller customers, and to conduct more sales on the phone (rather than face-to-face). And in February, Yodle bought Lighthouse Practice Management Group in Atlanta, for its expertise in helping businesses turn online customers into steady, repeat business.
With that kind of growth--and 22 million potential small-business customers nationwide--Yodle is a prime candidate for an eventual IPO. But Berkowitz says that for the time being, Yodle's investors are being patient. "This is one of the very few for them that is a homerun," Berkowitz says.
Should that grand slam happen, Stevens, will be watching from the sidelines. In 2010, he left the company to finish school at Wharton. Thirteen months later, Stevens (who remains a Yodle shareholder) started Punchey, a mobile payments and customer database tool for small businesses. It's a business, he says, that could eventually partner with Yodle.
The One-Stop Online Marketing Shop
Last year, Ben Rubenstein's Yodle raked in $132 million doing online marketing for small businesses. And it's growing.
ALLISON FASS is deputy editor of Inc.com. A longtime business journalist at Forbes and The New York Times, she has also held roles in venture capital and innovation at Hearst Interactive Media and digital strategy at a start-up consultancy. @alliefass
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