July 26, 2013, 3:43 PM

Technology provider Deluxe Corp. buys e-mail marketing vendor VerticalResponse

Deluxe Corp., provider of a wide range of services for small businesses, will pay $27 million for VerticalResponse, which has 17 clients among the top 1000 e-retailers. Deluxe estimates VerticalResponse's revenue for the remainder of 2013 at $12 million.

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Deluxe Corp., which got its start printing bank checks and now provides a wide range of technology and services to small businesses, has bought e-mail and social media marketing services vendor VerticalResponse Inc. for $27 million in cash, Deluxe announced yesterday. VerticalResponse, which employs 110 staffers, will continue operating under its own name and management from its San Francisco, CA, headquarters, Deluxe says.

In addition to providing technology and services, Deluxe still prints checks and other products, racking up online sales of $436.7 million last year, according to Internet Retailer’s estimate. Deluxe is No. 66 in the 2013 Top 500 Guide.

“VerticalResponse accelerates our web-based growth efforts with small businesses, adding valuable online promotional and Internet marketing services capabilities,” says Lee Schram, CEO of Deluxe. “This is a great opportunity for us to strengthen our offerings to small businesses and add a seasoned management team.”

VerticalResponse has 800,000 users worldwide, it says. They include three retailers in the 2013 Top 500 Guide: InterWorld Highway LLC, No. 354; Balsam Brands, No. 360; and AED Superstore, No. 393. The company also serves 14 retailers in the Second 500.

“Joining Deluxe means we will have resources to build new marketing tools faster and better, enabling small businesses to focus on what they do best—running their businesses,” says Janine Popick, CEO and founder of VerticalResponse.

Over the remainder of 2013, Deluxe projects that VerticalResponse will generate about $12 million in revenue.

Deluxe announced the acquisition yesterday along with its second quarter earnings. For Q2 ended June 30, it reports:

  • Total revenue was up 2.8% year over year, to $381.4 million from $371.0 million in Q2 2012;
  • Small business services revenue was up 8.0%, to $251.8 million from $233.1 million in Q2 2012;
  • Revenue from selling direct checks was down 10.9%, to $46.5 million from $52.2 million in Q2 2012.
  • Revenue from financial services was down 3.0%, $83.1 million from $85.7 million in Q2 2012. 
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