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Summary:

AOL announced two locally focused platform acquisitions today: Patch, which is designed to bring news and other information to local communities, and Going, which helps people find stuff to do in their areas. In the press release announcing the acquisitions, new AOL CEO (and former Google […]

aollocalAOL announced two locally focused platform acquisitions today: Patch, which is designed to bring news and other information to local communities, and Going, which helps people find stuff to do in their areas. In the press release announcing the acquisitions, new AOL CEO (and former Google exec) Tim Armstrong said local was “prime for innovation and an area where AOL has a significant audience.” Moving forward, Armstrong said, “[L]ocal will be a core area of focus and investment for AOL.”

The Patch acquisition has a twinge of corporate nepotism about it. Polar Capital Group, Tim Armstrong’s private investment company, was an early investor in the company, and the only one mentioned on Patch’s web site. A note about his support for Patch may suggest the direction Armstrong plans to take AOL. It also makes clear that Patch, for him, is something of a labor of love:

Polar invested in Patch because Tim believes that Patch should be in every community in America, and wants Patch in his town. He wants to read local news stories done by journalists, make sure that local government is transparent and accountable, see all the ways he can give back to his community, and have his town be as interesting and alive online as it is offline. Tim is also a believer in American ingenuity and knows that products like Patch will help deliver a commercially viable way for communities to support the important work of local journalists, institutions, governments, and businesses.

Armstrong promises not to take undue profits from buying his own investment. In a company-wide memo sent to AOLers, Armstrong writes:

I was an early investor in Patch and committed significant dollars to the vision of improving local communities with deeper online information, accountability through journalism, and a platform for communicating. In discussing our local strategy, AOL and Time Warner looked at Patch as a possible acquisition and I recused myself from that process. At the Time Warner negotiated acquisition price, I was in a position to earn a return on my investment in Patch. However, I have decided to forgo any profit from my seed investment in Patch and I have asked to receive just my seed capital in AOL shares once we separate from Time Warner.

Going had previously raised $5 million in a round led by General Catalyst Partners and Highland Capital Partners. Neither of the deals’ terms were disclosed.

  1. At http://www.twillage.com we’re also trying to bring local events in any city in the US by mining twitter. Let us know what you think. Our feeling is that twillage provides a more genuine view of what’s going on in a particular town, because it’s using tweets, whereas it’s not clear if people pay AOL to get listed in their local events pages.

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  2. Congratulations to our competitors at Patch.com on their big pay day. TheAlternativePress.com is New Jersey’s all-online daily hyperlocal newspaper now serving 10 municipalities in New Jersey, including Patch’s hometurf of Millburn. We have received over 10,000,000 hits since we launched in October and have significant paid advertising from local businesses. With over 100 paid reporters and nearly 20 columnists, all of whom live in New Jersey, we are able to provide local news and information from the locals themselves in a professional, objective manner.

    Michael Shapiro
    Editor, The AlternativePress

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  3. [...] [Link] Written by TechFever.NET • Filed Under ALL NEWS, InternetNEWS, NEWS, TechBiz News • [...]

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  4. [...] Kritisch gesehen wird von einigen Autoren, dass Tim Armstrong vor einiger Zeit selbst in Patch Meedia investiert hatte und sogar noch größter Investor ist. (Zu den Beratern gehört übrigens Blogger Jeff Jarvis, Autor von “Was würde Google tun?”.) Tim Armstrong bemüht sich in einem Rundschreiben an die Angestellten allerdings um Transparenz und hat eine Regelung angekündigt, nach der er nur sein investiertes Kapital in Form von AOL-Aktien (ein Börsengang ist ja geplant, um den Internetkonzern von Time Warner wieder zu trennen) bekommen solle. [...]

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  5. Out of the big players in the local search space, AOL has already positioned as a company to dominate this marketplace. Adding Patch and Going to their network will only get better. I’ve used both sites and they really do offer something of value. Great post.

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  6. [...] Going is a local event and entertainment listing site based in Boston. VentureBeat | TechCrunch | GigaOM [...]

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  7. [...] Going is a local event and entertainment listing site based in Boston. VentureBeat | TechCrunch | GigaOM [...]

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