For Some, Zeta Buy Means e-Dialog Reunion
By Ken Magill
eBay has sold its Enterprise unit—formerly GSI Commerce, a unit of which was the email service provider e-Dialog—for less than half of what it paid to acquire it.
What is more, marketing service provider Zeta Interactive has purchased the segment of eBay Enterprise that used to be email service provider e-Dialog, according to multiple sources.
The move reunites some former e-Dialog executives with what’s left of their old brand.
“During the second quarter of 2015, our Board of Directors approved a plan to sell the businesses underlying our Enterprise segment,” eBay said in its report for the second quarter of 2015. “On July 16, 2015, we signed a definitive agreement to sell these businesses for $925 million and, subject to customary closing conditions, we expect to close this transaction in the second half of 2015.”
GSI Commerce acquired e-Dialog in 2008 for $157 million in cash and stock.
eBay acquired GSI Commerce in 2011 for $2.4 billion and renamed it eBay Enterprise in 2013.
Just days before e-Dialog’s parent GSI Commerce announced it had agreed to be acquired by eBay for $2.4 billion, GSI reportedly fired dozens of e-Dialog’s top executives in the U.S. Ten firings in the U.K. followed. An exodus of other employees also reportedly followed.
“The atmosphere was terrible,” said one former employee at the time who asked not to be named. “Anyone who could find a job did.”
As a result, former e-Dialog employees are all over the industry, including where eBay Enterprise’s remnant of e-Dialog has reportedly ended up: Zeta Interactive.
According to one source in a position to know, eBay Enterprise was sold to a consortium of private equity firms.
According to multiple sources, Zeta Interactive bought the segment of eBay Enterprise that used to be e-Dialog.
Given that there are former e-Dialog employees all over the industry, it should come as no surprise there are some former e-Dialog executives in upper management at Zeta.
John Polcari is senior vice president of sales and marketing at Zeta. Polcari was executive vice president of product sales at e-Dialog.
John Doub is senior vice president, technical services at Zeta. He performed various roles for e-Dialog starting in 2006 and with eBay Enterprise until 2013.
Laura Saati is senior vice president, client services at Zeta. She was group director, professional services and then vice president, retail practice at e-Dialog from 2008 to 2011.
According to multiple sources, the email service provider portion of eBay Enterprise was bleeding clients.
“Zeta is the right company to do this [purchase],” said a source familiar with the transaction on condition of anonymity. “They like to buy companies in distress. They do well with these things.
“Now that GSI and eBay are out of the scene, Zeta moves in, buys what’s left, and it’s back in the hands of people who know how to run it,” the source said.
“Polcari is one of the best sales guys in the industry, Laura Saati [offers] really strong account management and Doub is a great technology product guy,” the source said. “And they have other good people there, as well.”
According to the source, Zeta has at least 10 former e-Dialog employees on staff.
“Where they [eBay Enterprise email employees] are going is certainly better than where they’ve been,” said another source.
Of course, it remains to be seen if Zeta can retain eBay Enterprise email clients as their contracts come up for renewal, the source added.
“Think about it,” the source said. “If you’re a client who has been planning to go into RFP, is this going to stop you?”
Said another source: “My guess is they’re on the phones with clients right now.”
Zeta did not respond to a call and a Tweet asking for comment.