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- Climb's M&A Weekly: Bain Capital, Tricentis and Banyan Software all feature
Climb's M&A Weekly: Bain Capital, Tricentis and Banyan Software all feature
GTCR invests $1.33 billion @ >10x valuation, Kingswood Capital Management expands in the cybersecurity space and Bain Capital finalizes acquisition
Nick @ Climb
December 01, 2024
I hope you all had a great Thanksgiving and are ready for a final push in 2024.
Short update on our side to start the newsletter this week.
Given our deal recent momentum + positive M&A sentiment in the markets, we are having many inbound conversation re: M&A. Therefore, we are launching two new advisory services for sellers.
“Quick Shop” - Think of this as a “test the waters” type process to see interest. We will run outreach to a limited pool of highly relevant strategic and financial buyers to determine real time market interest & valuation in your business. Process takes ~1 month start to finish.
“Retained Advisory” - For companies interested in selling 12-24 months out, we will prepare your data room, manage all inbound interest, prepare draft of CIM and identify areas to improve and prescribe advice based on our knowledge of latest market trends.
If either of these engagement models pique your interest, or if you’re looking to run a full-scale exit process, please do get in touch.
Tricentis receives $1.33 billion investment from PE firm GTCR
Overview: GTCR has announced a $1.33 billion investment in Tricentis, a Vienna founded, Austin-based leader in AI-driven continuous software testing and quality engineering. Widely recognized for revolutionizing software testing for DevOps, cloud, and enterprise applications, Tricentis is poised for further expansion under GTCR’s strategic guidance. The investment highlights Tricentis’ remarkable growth trajectory and positions it to capitalize on emerging market opportunities. Read more here.
Climb Comment: This significant move, valuing Tricentis at $4.5B or ~10x ARR underscores the rapid growth and importance of the software quality assurance market. Tricentis was a pioneer in the field of continuous & codeless testing, and today heavily leverages AI to drive even more efficient results. Tricentis is projecting to finish 2024 with over $425 million in ARR and growth of approximately 27% YoY while driving a meaningful and increasing level of profitability. Trusted by over 60% of Fortune 500 companies, Tricentis has become a key partner for enterprises navigating digital transformation.
Banyan Software announces the acquisition of DualEnroll
Overview: Banyan Software has acquired DualEnroll, a leading platform for enrollment management implemented by over 100 colleges and systems across the United States. DualEnroll simplifies the enrollment process, providing a seamless experience for students, schools, and colleges by automating workflows and reducing administrative burdens. The platform also facilitates high school students taking college courses. Read more here.
Climb Comment: Banyan continues to execute on their ongoing strategy of partnering with mission-critical software providers that offer long term value to niche markets. With this addition, Banyan strengthens its portfolio in the education technology sector, supporting DualEnroll’s continued growth. Higher ed & secondary education remain massively growing markets globally and Banyan will no doubt look to leverage existing sales & marketing infrastructure to drive expansion.
Vitu enters an agreement to acquire services from Cox Automotive
Overview: Vitu has signed an agreement to acquire the Dealertrack Registration and Titling businesses from Cox Automotive, making a strategic move to expand its capabilities in the automotive. Dealertrack is known for its advanced technology and strong market presence, complements Vitu’s mission to streamline the automotive registration process for dealerships and state agencies. Read more here.
Climb Comment: Vitu handles registration & e-titling for vehicles across all 50 US states and here adds advanced technology & strong teams to continue advancing leadership in those markets. Great example of a software company solving a simple yet complex problem & achieving real scale. Interesting to see Cox, the largest software provider for the automotive industry, divesting holdings, following January’s sale of a niche compliance product. Seems like a shift towards focusing on front-office products but could be coincidence.
Kingswood Capital Management completes deal for cybersecurity firm IDX
Overview: Kingswood Capital Management has acquired IDX, a leading provider of data breach response services and digital privacy protection, highlighting its focus on investing in technology-driven businesses addressing critical market needs. This acquisition positions IDX to further expand its offerings and solidify its leadership in the rapidly evolving cybersecurity and digital privacy sectors. Read more here.
Climb Comment: IDX offers cybersecurity solutions focused on data breach response. IDX provides dark web monitoring and security response after a breach to protect secure user data. IDX is used by more than 40 million individuals, as well as Fortune 500 companies & government agencies. Cybersecurity remains an attractive sector for M&A.
Bain Capital has finalized its acquisition of wealth management platform Envestnet
Overview: Bain Capital has completed its acquisition of Envestnet, a leading provider of wealth management technology and services. This partnership aims to accelerate Envestnet’s growth by using Bain Capital’s industry expertise and financial resources while supporting the company’s ethos of supporting financial advisors and institutions with advanced tools for wealth management, financial planning, and data analytics. Read more here.
Climb Comment: Bain, alongside Norwest & Reverence and other big name minority holders including BlackRock & State Street, took Envestnet private from the NYSE at a valuation of ~$4.5B. Envestnet reported ~$1.3B in TTM revenue at approximately breakeven (slightly negative) EBITDA. Bain is expected to replace the CEO and divest certain business units - Envestnet had faced activist criticism in recent years around low margins & stock underperformance. Some great additional color here.
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Article of the week
Interesting article here about how AI is reshaping call center work in the Philippines - where more than 86% of white-collar workers are already using AI to boost productivity. Fascinating read which delves into some of the frontline human implications for new technologies.
Thanks for following along & hope you found something useful or interesting. Please don’t hesitate to reach out if you’re considering a sale as we move towards 2025 - we’re always glad to chat & share perspective.
All the best,
Nick