Barry Diller runs his company, IAC, like a used-car dealership. That comparison is meant to disparage neither Diller nor used-car lots but to capture the shark-toothed, high-velocity, unsentimental manner in which Diller conducts business. How many photos of Diller have him wearing the fake grin of the car salesman, the one that says “I’m your friend until the deal is done or abandoned, and then you’re just another future mark to me”?
The vehicle on the market eliciting Diller’s deal lust this week is About.com, the content farm owned by the New York Times Co. After word leaked that the Times Co was about to sell the site to Answers.com for around $270 million, my Reuters colleague Peter Lauria reported that Diller was bidding “in excess of $300 million” to nab it for his Internet portfolio. Given Diller’s wheeler-dealer instincts, that was probably a soft offer. Lauria promptly tweeted a pair of qualifiers to his piece, noting that if Answers.com dropped out of the deal, IAC might cut its bid. “That’s dealmaking 101,” Lauria tweeted. “Diller knows this better than anyone.”
Lest you think I belabor the used-car-dealer metaphor, give a gander at the array of properties populating the IAC lot. Some, like Match.com, look like real businesses the way a BMW looks like a real car. Others, like Vimeo and Ask remind you of YouTube and Google the way Infiniti and Acura are supposed to remind you of Mercedes-Benz and Audi. Properties like ShoeBuy.com are the “beaters” on the lot, unglamorous Toyotas that should trundle on forever, while SportsPickle.com, Excite, and Newsweek/Daily Beast resemble rusty Suzukis, Kias and Mitsubishis, resting on concrete blocks.
That’s what the latter-day Diller does — he buys, sells and trades properties like a milkmaid churns butter, forever seeking to create a blend with higher value. And to hear him tell it, he’s doing a pretty good job. The stock has more than doubled over the last two years — up 118 percent — and it now has a market cap of $4.5 billion. That’s no Google ($221 billion), but what is? The latest quarterly earnings report put revenues at $680.6 million, up 40 percent.
IAC’s corporate history page illustrates his method better than any paragraph I could muster. He’s bought into and sold out of (or spun out of) the businesses of broadcast television, TV home shopping, tickets, hotel reservations, gifts, airline tickets, lending, invitations, and more since founding IAC’s precursor company in 1995, as well as starting and acquiring a slew of dot-coms along the way. “IAC resembles a Berkshire Hathaway of Internet companies, a cheap acquirer but stable and growing,” Vanessa Grigoriadis wrote in a recent issue of New York magazine, although I still insist the better comparison is CarMax. Everything he owns is for sale. Everything for sale is a potential acquisition. In 2009, Diller said on an earnings conference call that he was open to selling Ask to the right bidder. Dealers can’t be sentimental about their properties. (Note to Tina Brown: Keep updating your resume.)