Climb Advisors Weekly M&A Deals Newsletter

Climb Comment: Nice deal here in hospitality tech, with Mews acquiring market share, a great team and and strong product. In a more detailed breakout (link) on the deal, Mews Founder Richard Valtr calls out the lower friction of integrating a cloud-native platform into their own solution and the intrinsic value in acquiring a team with deep-seated industry knowledge. Both of these factors - team & tech - are major factors in strategic acquirers’ buy vs build planning. Integration (again, of both team & tech) is always a challenge but where there is strong fit on the front-end the job is easier and results better.

Climb Comment: The patient experience side of healthcare is an area of investor focus in recent years, with more insurers moving towards a ‘value-based care’ model that prioritizes patient outcomes and the full-cycle of engaging with health providers. Scheduling is a major obstacle and use of admin resources in a hospital or clinic, and both these companies are helping to solve it. Customer quotes on the Gyant site point towards ‘reduction in call center volume’ - patients are able to schedule appointments or find the proper services within the self-serve app vs navigating phone trees to get an answer. Fabric offers an even broader suite of products that provide in-office and pre-visit patient onboarding & follow up. Healthtech felt a little slow last year post Covid boom and it’s good to see deals moving again.

Climb Comment: Interesting AI deal here with Protect AI buying up a large open-source project & commercializing. We’ve touched in prior weeks about the challenge enterprises face with balancing need to innovate and integrate LLM based technology while also maintaining stringent security protocol. It’s only natural that software steps in to fill those gaps and both orgs here are on the leading edge of that. Laiyer AI’s ‘LLM Guard’ platform protects against what’s been called ‘prompt injection’ - hackers manipulating GPT models to gain access to proprietary information.

Climb Comment: Easy Employer marks Valsoft’s sixth deal in Workforce Management and will join a suite of products geared to manage and motivate employees in a range of sectors. Also, supports their continued expansion into ANZ as well. Easy Employer targets regulated industries such as elder care, pharma, & childcare, which have strict regulations around employee time tracking and the like. This supports Valsoft’s focus towards mission-critical software, which can be harder to find in the horizontal and shifting landscape of HR tech. Congrats to all involved and we expect continued M&A in the Australian market from Valsoft & others.

Climb Comment: Xplor takes an interesting approach to markets via a buy & build strategy that monetizes via payments and transactional revenue as well as SaaS. Xplor is backed by Advent International and focuses on ‘SaaS for everyday life’. The gym & health club space was one of the the hardest hit in 2020 and it’s telling that we are just now, almost four years later, seeing what appears to be ‘normal’ M&A in the market. Fitness tech companies with less fundamental strength went under early in the pandemic; others pivoted to remote workout & either capitalized on quick cash or fell off as the world reopened; others still were consolidated as distressed IP; and the remainder held on and came out the other side with resilience and prospects for growth. The latter appears to be the case here for Membr and they will have found a good home in Xplor, with a range of cross-sell and payments monetization opportunities.