Over the past few months, an investor based in New York, called TCS Capital Management LLC has slowly been buying up stake in Angie’s List Inc. With more than nine percent of total stake in the website that provides reviews from real consumers about service providers in their area, TCS has started to throw its weight around, demanding that Angie’s List look into merging with HomeAdvisor. According to a letter released at the beginning of October, the investors stated that they have been discussing this kind of merger with the board of Angie’s List for some time, but that no real action has been taken, so they are making their demands public.

That same letter stated that their public demands are an attempt to ensure the board understands the seriousness of this request, and that while Angie’s List has a strong following and decent revenues, the competition that other companies are brining will make it difficult for Angie’s List to stay on top for much longer, especially if they do not explore partnering with other companies who would be their direct competition.

TCS has specifically targeted Angie’s List chairman John H. Chuang, stating that since he became the chairman more than a year ago, the price of the company’s shares have declined by almost half.

It was in July of this year that TCS first began asking for a merger or even just for selling the business, back when they owned less than two percent of the company. As they have bought more and more shares in the company, they have begun to put more and more pressure on Angie’s List to find a strategic way to make money.

This type of investment, called activist investment, is becoming more and more common for hedge funds looking to make money, but it does not appear that Angie’s List is going to make any serious decisions anytime soon. While they have stated that they are always looking for ways to enhance the value of their shares, they have not stated whether they will or will not actually engage in a discussion about merging or selling the company.

Over the last four years, since Angie’s List became a public company, its share prices have been on a rollercoaster. Stock prices were at their highest in mid-2013, at around $28, but have since dropped to mere dollars in recent months, as Angie’s List has spent almost indiscriminately on attempting to expand.

Responding to Angie’s List’s comments about trying to find ways to add to shareholder value, TCS has said that they believe a merger is the best way to add that value, especially if the merger is with HomeAdvisor, another big name in the industry. This kind of merger would give Angie’s List the ability to become the top competitor in the home services industry, and it would do so without having to pay taxes and while still being a publicly traded company.

What Does This Mean for Your Business?

It can be difficult to know exactly what effect a merger like this could have on your business. If you are a competitor, it could mean that you would have to work harder than ever to attract attention to your company, as Angie’s List and HomeAdvisor become a behemoth. Finding a specific niche and sticking to that niche would enable you to find a footing.

For businesses that are reviewed on either Angie’s List or Home Advisor, it would mean access to more reviews, which is always a good thing. With social proof now being one of the most important factors in purchasing decisions, having a listing on one of these companies that is complete with reviews from satisfied customers, is a great way to encourage prospects to become clients or customers.

It doesn’t mean all good things however. A bigger and more powerful review website (or websites) could mean that negative reviews are easier to find and harder to bury or to reconcile.

In general, however, a more visible and frequently used review website, on which your business is listed and has reviews, is a good thing. A merger, depending on the structure of that merger and the finished result of that merger, could mean great things for your business, if Angie’s List ultimately goes through with it. TCS will likely continue to acquire stocks in the company and will continue to push the board to consider this type of merger, whether it is with Home Advisor or with another, similar company.