This Week's Plaxo Merger Rumor: Google

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In the words of one Silicon Valley insider that I spoke with today, “Plaxo has been desperately, desperately, desperately trying to sell” for quite some time. Late last year they got serious and hired an investment bank, Revolution Partners, to help move things along.

The rumor mill really got going when Revolution Partners started making their calls and sending out the company’s financial information to potential buyers. A rumor about a Facebook acquisition turned out to be false. Now Wired is reporting that Google may be doing the deal, for $200 million. Writer Megan McCarthy says she’s 100% sure a deal has been done, and thinks Google is the most likely buyer.

Plaxo did around $5 million in 2006 revenue, doubling that to $10-$12 million in 2007. 2008 projections are $20-$25 million. The company has 1.8 million worldwide visitors per month (Comscore).

Did Google buy them? The two companies are certainly friendly. Plaxo has been a big supporter of Google Open Social from the start, and has consistently adopted new Google social products. And Google’s new Social Graph API gels nicely with what Plaxo has done with Pulse.

More as this develops, if it does.

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