Hearsay Sold to Yext for More Than $125M

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Yext Inc. said late Tuesday that it's buying Hearsay Systems, a provider of social media and other client outreach tools to financial services firms, for $125 million. An extra $95 million could be paid to Hearsay if certain post-transaction performance targets are hit, according to the announcement.

The deal is expected to be finalized in the second half of Yext's fiscal year 2025 — which ends Jan. 31, 2025 — subject to customary closing conditions, such as regulatory approvals. The payout period, explained in Yext's 8-K filing, covers the two years after the formal closing of the transaction and is based on the annual recurring revenue generated from new sales.

"Customers are increasingly looking to consolidate digital marketing channels into one platform to increase efficiency, improve performance and reduce costs," according to Michael Walrath, CEO and board chairman of Yext. "With Hearsay Systems, we'll provide even more ways for brands to connect with their customers one-to-one."

Hearsay was co-founded in 2009 by Clara Shih, its executive chairwoman and CEO of Salesforce AI, as well as by technology entrepreneur Steve Garrity. Its tools are used by some 260,000 financial advisors and agents, including those at BlackRock, Charles Schwab and New York Life.

Yext, a digital experience platform, helps firms answer questions about their businesses online, as well organize and manage listings on search engines, landing pages for products and reviews across websites.

It says the aim of the deal is to combine its platform with Hearsay Systems' compliant-focused engagement solutions across social media, websites, text and voice.

Another important factor in the deal, according to Yext's announcement, is Hearsay Systems' integrations into CRM systems used by financial advisors — including Salesforce, whose venture capital arm invested in the company in 2020.

For its part, Salesforce counts Hightower, LPL Financial, BNY Mellon, Bank of America Merrill Lynch, Schwab, Fidelity, Wells Fargo, Goldman Sachs and other firms as clients.

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