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- Climb's M&A Weekly: Advent International, Valsoft and Vista all feature
Climb's M&A Weekly: Advent International, Valsoft and Vista all feature
Advent International continues to invest in manufacturing software and Valsoft enters the telecoms space
Nick @ Climb
August 18, 2024
Welcome to Climb Advisor’s weekly deal newsletter highlighting transactions announced last week across the B2B tech landscape.
Climb Advisors is an M&A and credit advisory firm focused on B2B software and services companies in the range of $5m to $100m+ 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.
Advent International adds SYSPRO to their portfolio
Overview: We see here another large deal for an ERP company focusing on the manufacturing industry, in this case SYSPRO. Headquartered in both South Africa and the UK, SYSPRO provides ERP software built specifically for the manufacturing and distribution industries. A perfect fit for Advent given the Boston based PE firm focuses on investments in ERP, financial and manufacturing software and claims to have invested over $21B in the manufacturing and industrial sector. Read more here.
Climb Comment: Substantial deal in ERP - interesting to see more movement in this sector in recent weeks, could be a bellwether of some return to market equilibrium & broader alignment between buyers & sellers. Given the scale & criticality of ERP software, businesses find value in choosing an industry specialized provider such as Syspro, and TAM is large + expanding. Syspro was founded in South Africa in 1978 and Founder Phil Duff, currently serving as Chairman, will retire in September post-close. Advent will bring Mike Ettling, former President at SAP SuccessFactors on as Chair.
Vertical software buyer Valsoft enters new market with deal for Equinox Information Systems
Overview: Valsoft enter the telecommunications space by acquiring Equinox. The Nashville based company has served over 380 telco companies, providing software focused on fraud management, business assurance and network monitoring. They’ll now be able to expand into global markets thanks to the additional resources and operational expertise Valsoft brings to the table. Read more here.
Climb Comment: Kudos to Valsoft for breaking into telco software, a sector that has been an area of success for competitors Constellation & ESW via their respective Lumine & TelcoDR business units. There’s a lot to like about telco for vertical aggregators — the products are sticky, companies often have inefficient go-to-market motions which present room for improvement, and the opportunities are global. It’s also a challenging space, which keeps buyer competition narrow. Telco operators (customers to Equinox and others) face regulatory pressure & there is an industry culture of preferring to spend on Capex vs Opex which makes selling SaaS subscriptions a challenge. Many of the large players are also hesitant to use off-the-shelf cloud software and prefer to host locally which presents an additional layer of complexity and reduces appetite from investors who want to stick to a clean ‘cloud saas’ mandate. Valsoft are pros at navigating these technicalities and no doubt will find further opportunities to grow their telco portfolio.
Silversmith Capital Partners backed Proven Optics to acquire CloudGenera
Overview: Fresh off investments from Silversmith Capital Partners and ServiceNow, Proven Optics is acquiring CloudGenera. This announcement marks the next step in the acquirer’s mission to create the most complete IT financial management application platform. CloudGenera’s software solutions use AI and ML techniques to help organizations more accurately forecast cloud costs, thus improving overall technology spend. It’s also worth noting that Proven Optics outlined intentions to stay active, saying they anticipate several transactions in the coming months. Read more here.
Climb Comment: As Proven Optics pushes to become a leader in financial management around IT infrastructure it’s natural they’d acquire a company focusing on optimizing cloud spend. Cloud spend is an increasingly material business expense & CloudGenera offers both visibility into where expenses & assets lie and prescriptive guidance to lower future costs. Proven Optics will no doubt deeply integrate these capabilities into their stack and also offer single workflow solutions into ServiceNow.
Permira backed Mimecast makes Aware their second acquisition in 3 weeks
Overview: Human risk management company Mimecast makes our newsletter again, having only first appeared 3 weeks ago with a deal for Code42. This time they’re acquiring Aware, a provider of a security platform that uses AI models to identify risks on workplace collaboration tools such as Slack and Microsoft Teams. By making this move Mimecast aims to leverage Aware’s expertise to boost their own platform’s AI capabilities, citing Zoom and business emails as channels they specifically want to target. Read more here.
Climb Comment: Big Brother is watching, with Aware using AI/ML to monitor Slack & other collaboration channels for potentially sensitive data. The reality is that most cybersecurity instances, data leaks, etc come back to a human ‘leaving the door open’ or unintentionally providing data or access to bad actors. In an enterprise setting, having safeguards like Aware in place can stop security events from happening as well as raise employee & management awareness of potential soft spots & areas to improve.
Vista Equity Partners agree to buy JAGGAER from Cinven
Overview: Vista is buying JAGGAER, provider of a SaaS platform to help companies automate and manage their supply chains, from fellow PE firm Cinven. Since Cinven’s investment in 2019, JAGGAER has become a global leader in enterprise procurement and supplier collaboration, serving over 1,400 customers across 55 countries to ensure they have a resilient and integrated supplier base. Read more here.
Climb Comment: Great growth & value creation play from Cinven, executing on a number of strategic initiatives over the past 5 years including integrating JAGGAER’s products into a single cloud-based suite, scaling global GTM, adding key management hires, & more. Vista takes possession of a global leader in source-to-pay procurement and will likely look for add-on opportunities to continue expanding into some of the world’s largest organizations.
Article of the week
This week we’re excited to share the 2024 Pepperdine Private Capital Markets Report. The report dives into a number of segments across private capital and looks into expectations, practices and methodology from a number of market players.
Thanks for following along & hope you found something useful or interesting.
All the best,
Nick