Climb Advisors Weekly M&A Deals Newsletter

The Week in Review

Author

Nick @ Climb
October 29, 2023

Welcome to Climb Advisor’s weekly deal newsletter highlighting transactions announced last week across the B2B tech landscape.

Climb Advisors is an M&A advisory firm focused on B2B software and services companies in the range of $5m to $50m+ enterprise value. We guide CEOs and business owners through the process of selling their business & assist investors in sourcing & closing great deals. We love to talk markets and share beneficial information - please reach out any time.

Teleo Capital acquires Plum Voice and merges them with Sharpen Technologies

Overview: The lower middle market PE firm has announced a deal for Plum Voice, a provider of AI-powered solutions for customer interactions such as voice automation and speech recognition, staffing 16 employees. The deal will see them merge with contact center software provider Sharpen Technologies to expand Sharpen’s capabilities around conversational AI and interactive voice responses. Read more here.

Climb Comment: Contact centers serve as an important communication channel for organizations across a wide range of verticals. They often act as a frontline for both new customer acquisition and existing customer retention. Advances in recent years around automated voice technologies have driven value creation across the landscape and the improvements show no sign of stopping.

Plum Voice offers API connection with GPT and other LLMs, enabling organizations to take advantage of these technology advancements. Their addition will lead to Sharpen gaining day-one value across their existing customer base by rolling out improved auto-speech functionality, enhancing Sharpen’s existing agent performance tools.

Smart communications platform Ooma acquires 2600Hz for $30m

Overview: With this deal, Ooma will take over the direction and development of 2600Hz’s technology road map, whose current communications apps primarily target carriers and resellers. The aim is to create more scalable and open communication solutions by adding the intellectual property associated with Ooma’s platforms to 2600Hz’s current offerings. In return, Ooma will receive approx. $7m in recurring revenue annually, along with improved call center, AI and CPaaS capabilities. Read more here.

Climb Comment: Ooma has been an active buyer in the broader UCaaS space over the past few years with acquisitions such as Voxter, OnSip and Broadsmart. A healthy multiple of 4.2x on $7m in ARR, is broadly tracking with what we’ve seen in the private markets.

2600ZHz maintains an impressive technology stack which includes 300+ APIs on top of an out-of-the-box whitelabel Unified Communications platform.

Databricks snaps up Arcion for $100m

Overview: Databricks is a data infrastructure platform with their chief analytics tool powered by a deep learning AI model. The acquisition of data replication startup Arcion, (who raised $13m from investors including investment Databricks) adds the crucial ability to populate enterprise customers with bespoke training data. Databricks clients will now be able to add data from software systems such as Salesforce, Workday and Oracle without any third party tools. Read more here.

Climb Comment: Databricks is a leading enterprise company in the field of AI, offering organizations secure and customized LLMs and associated infrastructure. Arcion solves a crucial pinch-point in the equation by offering real-time database replication at enterprise scale.

One of the leading challenges of large organizations adopting new AI capabilities is the challenge of maintaining data security and governance. Databricks has tremendous strength here in their own right but the ability to quickly create standalone training data that does not risk ongoing operations is a huge win for Databricks and for their customers.

ICONI Software Ltd. joins the Banyan Software family

Overview: The Belfast based startup with a team of 24 employees has become the latest acquisition by Banyan, who acquire enterprise software businesses in niche markets globally. ICONI provides case management software that specifically caters to the needs of government funded support projects in the UK. Their solutions help track and secure data whilst streamlining workflow and processes to support beneficiaries with employability, health/wellbeing and educational skills. Read more here.

Climb Comment: Great deal here from Banyan! It’s exciting to see them continue to expand their footprint in the EU with the acquisition of ICONI. EU countries tend to have more robust social services programs relative to the US and this full-service platform, which provides internal management for these government and non-profit organizations, as well as user-facing capabilities, will provide a strong base for Banyan to optimize operations and achieve growth.

Alpine investors announce new fund formation

Overview: PE firm Alpine Investors has closed a $3.4B single-asset continue its partnership with its portfolio company Apex Service Partners. With over 8,000 employees in the US, Apex is a residential HVAC, plumbing and electrical services platform that allows leaders in these fields to build a network to share resources, best practices and expertise. Read more here.

Climb Comment: Interesting fund announcement from the offline world. Alpine Investors has generated tremendous value across a range of acquisition vehicles and this fund will support their mission to create a leading national platform in HVAC, Electrical and Plumbing. These end markets are largely acyclical - growth definitely occurs when housing grows broadly, but even in a recessionary environment plumbing and electricity are crucial services. The oft-touted ‘Silver Tsunami’ of retiring business owners provides numerous opportunities to acquire scaled businesses and regional players across these markets and to run them under a unified brand with enterprise grade operations, hiring, purchasing, and marketing.

Thanks for following along & hope you found something useful or interesting. We’ll be back next week with more deals.

All the best,

Nick

Nick Cellura

Principal, Climb Advisors