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Redpoint Ventures Doubles Down On Answers Corp.

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imageVC firm Redpoint Ventures has exercised its option to purchase $7 million in additional convertible preferred stock in Answers Corp., which runs Answers.com and WikiAnswers.com (NSDQ: ANSW). Redpoint was already Answers’ largest investor, according to a release. Redpoint purchased $6 million in preferred stock from the company last June — and had the option to purchase the stock it bought today. As part of the additional investment, Redpoint will get a second seat on Answers’ board of directors.

Answers says that the investment “confirms their support and confidence in our vision to build the world’s best Q&A site” — and Redpoint says it “reflects the growth opportunity for their technology and community in the Q&A space.” But the company’s growth has been uneven. Its user-generated Q&A site WikiAnswers.com has greatly outperformed reference site Answers.com. For instance, during the first quarter of the year, revenue at WikiAnswers.com increased 166 percent to $3.16 million, while revenue at Answers.com dropped 14 percent to $1.57 million.