Magazine article American Banker

Root Buys Analytics Firm to Give Lenders Lead Data

Magazine article American Banker

Root Buys Analytics Firm to Give Lenders Lead Data

Article excerpt

To help achieve its goal of building a global, commodities-like market for mortgage leads, Root Markets Inc. has started offering analytical tools for the buyers on its online exchange -- and it started generating leads for sale on the exchange.

The New York company, chaired by the Wall Street legend Lewis S. Ranieri, will announce today that it has acquired LeadROI Inc., an analytics company, to provide pricing and conversion rate data to lenders that buy leads through the online exchange. For those buyers, such data is the equivalent of the tools and services a stock or bond investor might get on a Bloomberg machine or from a financial adviser, Root says.

Marcia Myerberg, Root's chief executive, said Friday that it is also offering Root Publisher, a service for "large publishers." The service gathers the contact information of prospective mortgage customers through the Web site of The New York Times (whose parent company is a major investor in Root).

The service is meant to boost trading volume, she said.

Ms. Myerberg, who worked with Mr. Ranieri at Salomon Brothers in the 1980s, said that by providing buyers with better metrics on conversion rates, Root will improve the sometimes "opaque" pricing in the lead exchange market, as buyers get better at determining lead quality, or the accuracy of lead information, and adjust how much they are willing to pay.

"Quality, transparency, and liquidity are the endgame in making this an efficient market," she said.

Customers who purchase leads from Root can use LeadROI to track conversion rates and decide the quality and pricing of leads that will maximize their return on investment. Before it bought LeadROI, Root categorized leads by quality and pricing but did not offer a system that allowed buyers to track the leads they bought.

One of LeadROI's competitors, Kaleidico LLC, is already used by Root's chief rival, LeadPoint Inc. …

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