Avvo, the free legal ratings and review site that has taken on the giant legal publishers that have long dominated the business, announced that it has raised $10 million in Series C funding. The new round adds to $13 million previously raised. The round was led by DAG Ventures, which joins existing investors Benchmark Capital and Ignition Partners.

The company’s business model relies on advertising and enhanced legal profiles. Avvo says it now covers 90 percent of U.S. lawyers. Legal is a $225 billion industry in the U.S. The industry spends about $4.5 billion annually on marketing.

CEO Mark Britton says that the company has grown rapidly, and now has 38 employees, including 18 sales people. The key to winning the new funding was the company’s success  in selling advertising to lawyers. Advertising  launched in early 2009, with a wide range of offerings “from $25 to thousands of dollars” a month .

Lawyers are always very busy, but can be sold if you understand their specific needs as a divorce specialist, or a real estate lawyer, says Britton. They also want to do more than by advertising, wanting to discuss ways to improve their profile on the site, etc.  “Lawyers need a lot of help.”

The “Flash e-commerce” space got hotter today, as Washington, D.C.-based LivingSocial announced a new $30 million round led by U.S. Venture Partners. Grotech Ventures and Revolution (Steve Case’s company) are also participating.

The funding will be used to launch deal-a-day coupon sites in Chicago, Denver/Boulder, Raleigh-Durham and San Diego. These cities are actually live today, along with Atlanta, Austin, Boston, Los Angeles, Minneapolis-St. Paul, New York, San Francisco, Seattle and Washington, D.C.

LivingSocial got its start with Visual Bookshelf on Facebook, and has launched some additional applications since then (i.e., “Find a Happy Hour,” “Pick Your Five”). The company appears mostly focused, however, on the hot Deal a Day space, where it competes with Groupon, which has raised a total of $34.7 million, as well as a host of similarly themed providers (and many more on the way).

Last August, CEO and cofounder Tim O’Shaughnessy told us he sees the LivingSocial deals as “a huge opportunity” to market to customers based on their pronounced online preferences, and to take those preferences offline.

Reply.com this week announced plans to raise $60 million in an IPO. ReachLocal had earlier announced similar plans to go public. The success of one or both companies’ efforts will have a major impact on other local-themed companies’ efforts to raise funds and/or go public.

Looking at Reply.com’s SV-1, we see that the company has 127 full-time employees, including 103 in sales and marketing, 14 in technology and 10 in general and administrative. It has raised $27.5 million since its inception, and last year grossed $34.3 million in revenues from more than 5,000 advertisers. It also delivered 700,000 leads.

The brainchild of AutoWeb Cofounder Payam Zamani, Reply.com was founded in 2001 primarily as a lead generation service for autos, with real estate added in 2003. In 2005, the company acquired Connecting Neighbors, which builds sponsored neighborhood Web sites for real estate professionals.

In 2006, Reply.com’s strategy made a sharp turn. It announced plans to sell Connecting Neighbors, which recently only contributed 5 percent of its revenues; and added “enhanced clicks” generated from auctioning inventory for a variety of local categories from the search engines and ad networks. The company reasoned that the search engines and ad networks had a massive amount of left-over local inventory that needed to be specially targeted.

The online auction marketplace was introduced in 4Q 2008 with auto and real estate components. Since then, it has added home improvement and has just added insurance.

In the SVI, Reply.com noted that 65 percent of its income comes from locally targeted national accounts, aggregators and channel partners. But an emerging sales focus is on channel partners offering white-labeled versions of its system. Traditional media companies with a large installed base of advertisers are being specifically targeted.

Reply.com COO Sean Fox is a featured speaker at Marketplaces 2010, taking place in San Diego March 22-24.

EveryScape, a Massachusetts-based company that offers an immersive local search experience, has secured a new $6 million funding round. We see this as a sign of confidence that the model EveryScape is pursuing — creating a virtual local search experience where you can find a local business, walk in the door and virtually browse and purchase inventory — is a significant and immediate opportunity.

The lead investor in this round (EveryScape has raised $16 million to date) is SK Telecom Co., South Korea’s primary carrier and a major Web portal. The venture capital firm Draper Fisher Jurvetson also participated.

EveryScape operates in a space that is increasingly on the radar of local search and directory players. In Europe, publishers that include PagesJaunes, European Directories and Seat all offer various flavors of immersive search, often using internally developed solutions.

EveryScape has deployed its solution with a number of partners to date, including such local search or tourist destination sites as Philly.com, HarvardSquare.com and others.

The money is moving quickly into the third-party SMB reseller space. ReachLocal has applied for a $100 million IPO, which could go out this spring. In hopes of similar paydays, its rivals are raising hordes of cash. Yodle, for instance, has announced that it has added $10 million, boosting its total amount raised $38 million. And now WebVisible has announced a $20 million round, making its total amount raised $37 million.

According to paidContent, the new round was led by Adams Street Partners, a Chicago-based PE firm. WebVisible’s last round, for $12 million, was led by Sutter Hill Ventures, with previous backer Redpoint Ventures.

WebVisible CEO Kirsten Mangers tells us that she would certainly claim certain competitive advantages over ReachLocal. But Reach’s “explosive growth shows that the market is solid; it is really good green field. Local interactive is the emerging field in interactive,” she adds. “Wall Street will show its support of the business mode.”

While WebVisible doesn’t disclose earnings, Mangers notes that it had 113 percent year-over-year growth in 2009, and a client roster of 40,000 to 45,000 active SMBs. More than 100,000 accounts have worked with WebVisible at one time or another. Top partners include AT&T, Intuit and BT.

WebVisible has also greatly boosted its presence in its size and international presence, with operations in Europe and Australia. Several international deals are pending, adds Mangers. It is also investing heavily in its “Geneva” (i.e., neutral) technology platform.

With the rise of mobile, WebVisible has been especially focused on building “multi-media, multi-device and multi-persona” capabilities that can effectively reach users in different places and dayparts,” says Mangers. “Local is where the consumer says it is.” While mobile is still a minor piece of the puzzle, Mangers predicts “it will be a rather high percentage in the course of the next 24 months.”

But, she emphasizes,  it is important not to get too far ahead of the cart. “So many SMBs still haven’t tipped their toes into the search waters yet.”

Less than a month after its peer company Idearc Media emerged from bankruptcy with a new name (SuperMedia) and a new lease on life, R.H. Donnelley has done the same thing. Freshly out of bankruptcy and US$6 billion lighter on its balance sheet, RHD has shed its historic corporate name in favor of DexOne, which will trade on the NYSE as DEXO.

We spoke with DexOne CEO Dave Swanson this morning about the name change, the company’s going forward strategy and the outlook for the small-business economy in 2010.

Right out of the gate the new company is making changes. Besides a new name and a new board of directors, it is also forming new partnerships. Swanson told us DexOne has inked a deal with Yelp to incorporate Yelp reviews into the DexKnows.com IYP.

Swanson told us the name change had several purposes. The first was that the name R.H. Donnelley, for all its history, is too closely tied with the print Yellow Pages business. And Swanson made it clear that, “Strategically our business is no longer Yellow Pages. It is marketing services.”

He added that because the company is the product of so many acquisitions (Sprint, Quest Dex, Business.com), it made sense to get the whole company behind a single name. And finally, the “One” in DexOne is meant to invoke the idea that DexOne is a one-stop solution for small-business advertisers.

The DexOne vision for a sustainable future is similar to what other companies are trying to execute — provide local advertisers with a mixture of advertising and service products that help them drive and manage new business leads.

This means selling everything from print Yellow Pages to its own IYP to others’ IYPs (Yellowpages.com and SuperMedia) to voice, online video, SEM and so on. Then, DexOne takes the complex melange of lead sources and boils it down into simple packages, or “matrixed pricing.” Swanson compares this approach to how cars are sold — there is a base model, a mid-range model and luxury model.

Given the obvious effort to distance his company from the traditional Yellow Pages label, we asked Swanson where traditional Yellow Pages fits into DexOne’s long term plans. He says print YP remains the predominant source of leads for most top categories, but each year, that becomes slightly less so.

“If all a company does is sell Yellow Pages, it will be difficult to grow over the next 10 to 15 years,” Swanson said. “The product is in slow secular decline. But that doesn’t mean our business has to be in slow secular decline.” Still, while conceding a secular decline, Swanson says he believes print will be relevant for at least another 20 years.

As for the cyclical element, Swanson see only modest improvement in 2010 over 2009.

“The local business economy is not recovering at the rate that financial services and some other segments are recovering,” he says. “And as goes the local business economy, so goes our business.”

Bono and Yelp CEO Jeremy Stoppelman

As widely reported last week, Yelp has confirmed that it will receive a $25 million investment from Elevation Partners, which is widely known for the involvement of U2 frontman Bono among its seven partners.  Elevation, which manages $1.9 billion, will also seek to increase its total investment to $100 million via stock shares from vested employees and other eligible shareholders.

In a statement, Yelp said it “plans to use the additional funding to deepen its market leadership position throughout the US, accelerate growth in Canada and throughout Western Europe, and continue the development of innovative mobile applications.”

Yelp had been in apparent talks to be purchased by Google for $500 million in December , but it isn’t clear why the deal didn’t go through (or even if the talks really happened). Elevation’s valuation of Yelp appears to be for less than $500 million.

Elevation is also an investor in Move.com, Palm, Forbes Magazine — all  contrarian bets.

Yelp Product Manager Eric  Singley is appearing on the Mobile Superforum at Marketplaces 2010 March 22-24 in San Diego.

Venture capital king Frank Quattrone (the banker behind Amazon, Netscape and Cisco) has a message: IPOs have gotten too big, innovation is being stifled, exits are being delayed and firms need straight-forward advice, not Wall Street “casinos.”

“Wall Street no longer knows how to value,” he complained, during a breakfast talk before 500+  VCs and entrepreneurs at the San Diego Venture Group.

Over the past ten years, the average IPOs is 40 percent below its rollout price, noted Quattrone.  Part of this failure is because of unsustainable trends driven by banker greed. This forces companies to artificially drive big profits and assemble “vertical stacks of technology” instead of focusing on what they might do really well. Citing Oracle’s acquisition of Sun as an example, he said “we’re going back to a world where companies want to do everything.”

It’s a far cry from the 1980s, when a focused company like Adobe could do well with a $5 million IPO handled by small banks such as Hambrecht & Quist. While all the big IPOs are being handled by monster banks today, there’s nothing wrong with using small banks, Quattrone added. “It’s like saying that if you don’t get into Harvard or Stanford, you are going to work in the coal mines.” In fact, he says, there are “plenty of great institutions.”

Quattrone, who recently overturned a conviction for interfering with a government probe into IPO allocation, said he’s through with banking and its broken system and wants t ore-enter the builder class. ”I’ve always been more of an entrepreneur than a banker,” he said (although there are few bankers in Quattrone’s $160 Million per year category).

His new 23 person firm, Qatalyst, will advise firms, including VC backed startups and “tweeners” earning between $1 billion and $1.5 billion per year. His hopes are to build stable relationships with the investment community, rather than the get rich quick mentality of recent years – and ultimately achieve a better track record of successful IPOs.

When eight of ten IPOs can be counted as successful, average financial advisers will be able to recommend them again, he said.  “That’s the key for fund manager influence.” For now, they don’t go near them.

And yes, Quattrone is unrepentant: he still believes that technologically sophisticated bankers should get rewarded for their insights and perseverance with higher shares of IPO allocation than “know nothing” hedge funds.  “Don’t be democratic in your allocations,” he said.

The year-end money deals continue. Today, The San Jose Business Journal reports that Center’d has raised another $1.875 million on top of the $6.5 million it previously raised.  The two-year-old, mom-friendly local search and events planning site, initially launched as “FatDoor,” is led by former Yahoo Marketplaces head Jennifer Dulski and former Microsoft maps exec Chandu Thota. Among its board members is former <a href=”http://www.intuit.com”>Intuit</a> head Bill Harris.

The site is working to differentiate itself from competitors on the city guide side such as Citysearch and Yelp, and on the events side such as Eventful, Zvents and American Towns with an orientation toward mothers, and features such as “Sentiment Analysis,” which, like Marchex’s OpenList,  semantically analyzes what people are saying about local places on the Web, sucking in information from local and travel review sites, review aggregators and blogs.

LiveDeal, under new management, has moved away from its roots in Yellow Pages and classifieds, and begun a strategic focus on high-end SMB services. As part of its strategy, the company has been selling off many of its directory-related accounts, which CEO Mike Edelhart calls high maintenance, high churn, low yielding and declining.

To date, 24,000 accounts have been sold off, including 14,000 yesterday to Local.com, which paid $3.1 million. That leaves roughly 25,000 of LiveDeal’s original directory accounts.

Edelhart notes that the typical Internet Yellow Pages account has been bringing in just $380 per year, with as much as 45 percent going to third parties and billing costs. They often have delayed payments to boot.

By contrast, its suite of SMB services brings in $3,500 per year. Included in LiveDeal’s suite are URLs, Web sites, SEO/SEM and click to call. Most are being sold via telemarketing. “We’re good at that,” he says.

The company’s clean, new, sophisticated Web site also plays a role. “It encourages people to call us.”

“We’re [no longer] selling other people’s capabilities,” says Edelhart. “We’re selling things that we service ourselves,” which allows the company to extend customer relationships.

At this point, LiveDeal has 1,500 leads-related accounts, on top of the remaining 25,000 directory accounts. In the end, Edelhart hopes to acquire many more leads-related accounts, while keeping just 10,000 of the directory accounts — the ones that come from higher-yielding national and automatic clearinghouse accounts.

Classifieds, however, are not a current focus (remember, LiveDeal started life as a classified company). But Edelhart expects that they’ll eventually be integrated with the new offerings.

With the sales of the directory accounts and the SMB services’ stronger cash generation, the company has developed a cash hoard of $11 million, Edelhart adds, up from $3.8 million in September. “This business model accumulates cash,” he says.

The company also has a management team “that is entirely new,” says Edelhart. “We never had a VP of marketing before. We never had a VP of product.” The company now has 120 employees in total, half of whom are in sales.