Redpoint to put up to $13M into Answers Corp.
Ask is a successful company, so why not Answers, too? To help hedge its bets, publicly-traded Answers Corp. (NASDAQ: ANSW) has inked an agreement for up to $13 million from Silicon Valley VC firm Redpoint Ventures, with $6 million being delivered immediately.
Answers runs a two sites, Answers.com and WikiAnswers.com. The former is the company’s flagship site, drawing in content from an in-house editorial team, Wikipedia, and WikiAnswers, a question-and-answer site that relies on user contributions.
The company is claiming some notable milestones, including 11 million monthly unique visitors in May, according to ComScore (which usually shoots low). WikiAnswers has three million questions asked, although it seems fair to assume that not all of those questions have received good answers.
Because Answers is public, the company provided some extra detail on the investment. Here’s a direct quote from the release:
Through a transaction executed on June 16, 2008, Answers issued $6 million of series a convertible preferred stock, convertible into 1,333,333 shares of common stock at a conversion price of $4.50 per share, with 50% warrant coverage at an exercise price of $4.95. Additionally, Redpoint was issued a second tranche warrant, exercisable over the next 12 months, to purchase up to an additional $7 million of series b convertible preferred stock, convertible into 1,272,727 shares of common stock at a conversion price of $5.50 per share, with 50% warrant coverage at an exercise price of $6.05.
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About the Author, Chris Morrison
Chris Morrison writes about cleantech and environmental issues for VentureBeat, with occasional forays into gaming and semantic technology. He got his start writing about tech for Business 2.0 magazine, but quickly realized new media was the ticket when that institution closed its doors in 2007. Chris has also covered public equities and regulatory issues. He originally hails from southern Virginia, graduated from Evergreen State College in Washington, and now lives in San Francisco.