For the newest members of the dot-com millionaires club, money grows on family trees.
The men, many of whom are Mormons, have cashed in after their genealogy service agreed to a £1bn buyout led by UK investors excited by a global roots-finding trend boosted by, among other celebrities, Gwyneth Paltrow.
To recap – because this isn’t your average city deal – Hollywood has helped inspire London suits to spend a cool billion on a company founded in the back of a car in Utah by Mormons. Who are they, and how did they strike gold?
Paul Allen (not the Microsoft guy) and Dan Taggart were graduates of the Mormon Brigham Young University in Utah, who, in 1990, founded Infobases, church publications on floppy discs, from the back of a car. By 1997, its parent company bought Ancestry magazine, a genealogy newsletter. It soon went online and exploded in popularity in and far beyond the church.
Ancestry.co.uk opened in 2002, offering subscribers access to archives, census records and tree-building software. Interest boomed further from 2004 with the start of the BBC’s Who Do You Think You Are? series, in which J K Rowling and Jeremy Paxman traced their roots.
The company now has more than two million subscribers worldwide paying up to £19 a month in the UK, where it also sponsors genealogy events. The US version of the BBC show, which ran for three series on NBC and included Paltrow, helped boost subscribers by 40 per cent.
Allen is still involved, while Taggart remains on the board. They stand to make millions after the buyout on Monday by UK private equity firm, Permira, as will chief executive, Tim Sullivan, and finance boss, Howard Hochhauser.
Since the days of libraries and dusty archives, the web has transformed our desire to unearth our past, while the accessibility of DNA technology allows subscribers to go beyond Great Aunty Mildred to the origins of man.
Ancestry.com now has 850 employees, with global revenues of £300m. But the site’s own corporate history makes no mention of its roots in Mormonism, for which family history is a central part of faith. Moreover, its rise is separate from that of FamilySearch, the church’s own site, which claims to be the largest of its kind.
All involved should take heed of past failures before they pick from the money tree. In 2009, Ancestry.com nearly bought Friends Reunited, the former web giant bought in 2005 by ITV for £175m thanks in part to the strength of its Genes Reunited branch. Four years later, ITV sold the site for £25m – not that Allen and co. will be picking over that huge loss right now.