When most startups launch, they envision one day going public through an IPO or being acquired by a larger, more established company.
In Austin, startup acquisitions flow out pretty much every week. Some of the deals are small and under the radar -- some a big events that include news releases and big returns for investors.
We track these deals daily in our newsletter, the Beat, and share monthly roundups because the exits are part of what helps fuel the growth of new startups and new angel investors to help back other local teams.
Here, we've gathered the top few deals from each month of 2019 to give readers a glance back at the big startup exits of the year. Among the top deals: TrendKite's acquisition by Cision, Upland Software's IPO and Digital Pharmacist getting scooped up by K1 Investment Management.
Now, let's dive in ...
January
Cision, a large PR and earned media company based in Chicago, acquired TrendKite for $225 million. TrendKite’s investors have included Harmony Partners, Silverton Partners, Adams Street Partners, Battery Ventures, Mercury Fund and Noro-Moseley Partners. TrendKite was launched by Matt Allison and A.J. Bruno in 2012.
Drillinginfo, a fast-growing oil and gas software and data company, acquired Austin-based MineralSoft, which makes software to manage royalties and other mineral interests. MineralSoft had 35 employees at the time and had been backed by Cottonwood Venture Partners, Blue Bear Capital and Y Combinator. Drillinginfo and MineralSoft had been partnered for more than a year before the deal was announced. No financial details were provided.
CMIT Solutions, an Austin IT services company, was acquired by Dallas-based private equity firm Craftsman Capital. CMIT CEO Jeff Connally and all the company’s employees were expected to remain in Austin in its current office. Terms of the deal weren’t disclosed. The company was founded in 1996 by Georgia Jones.
February
Strive Logistics, which has offices in both Chicago and Austin, was acquired by Redwood Logistics, a third party logistic co. with over $1 billion in freight under management. Terms of the deal were not disclosed, and Strive is backed by private equity firm CI Capital Partners.
March
Digital Pharmacist Inc., an Austin-based software company, got scooped up in a $125 million deal with LA-based PE and VC firm K1 Investment Management, which is a subsidiary of Mdk Limited Partners Ltd. in South Korea. The firm bought out Austin VC firm LiveOak Venture Partners, which led a $6.5 million Series B round in Digital Pharmacist a couple years ago. The SaaS company, at the time, was working with roughly 7,500 independent U.S. pharmacists on external communications like text reminders to refill a subscription and marketing emails. The ABJ reported that the buyout valued Digital Pharmacist at $125 million. The company launched in 2010 as RxWiki Inc.
Software giant Atlassian acquired Georgetown, Texas-based agile development software maker AgileCraft for $166 million. It was a huge exit for AgileCraft, which was founded in 2013. The company, led by founder and CEO Steve Elliott, had raised just over $10 million in funding. That came mostly in a $10 million Series A in 2015 led by private equity firm Crane Nelson. Former Bank of America executives Jim Kelly and Tim Arnoult also added to the round.
Austin healthcare security and privacy compliance company CynergisTek announced it will sell its managed print services business division to healthcare document services company Vereco for $30 million. CynergisTek was expected to continue to operate its other divisions, and it will use some of the sale proceeds to pay down debt and grow its cybersecurity business.
Austin-based digital agency Springbox was acquired by Chicago-based consulting firm Prophet. Springbox kept its name and was to be led by CEO John Ellett. No financial details were provided. Springbox has raised about $12 million from investors including Atoll Asset Management, Galleon Group and Chesapeake Partners Management, according to Crunchbase. It also acquired nFusion last year.
April
Credit card giant Mastercard Inc. scooped up Austin financial-technology company Vyze Inc. for an undisclosed sum. The deal gave Mastercard access to tech that can facilitate big-ticket purchases, the ABJ reported. Vyze’s software connects lenders and retailers to offer consumers several options to finance their purchase at the point of sale. Vyze previously raised $13.1 million in an August 2017 Series C funding round led by Austin Ventures. At the time, the startup had raised $48 million since its 2008 launch.
Upland Software, a publicly traded enterprise workplace management software company, acquired Austin email software company PostUp for about $35 million. The deal was poised to add $11 million in annual revenue to Upland’s balance sheets, which will now brings it to $205 million in annual revenue run rate. PostUp’s email software help marketers provide personalized, engaging emails that help build lasting relationships. It works with NBC, HBO, Sony and several other big companies.
Job.ai, an Austin speech analytics and natural language startup that draws insights from conference calls, announced it was acquired by Evolve IP, a cloud computing company based in Wayne, Pa. Jog.ai was founded in 2016 by Ed Ireson and Sam Gaddis, and it has received funding from Deep Space Ventures and Capital Factory, according to Crunchbase.
May
Upland Software‘s public offering initially raised around $138.6 million, the ABJ reported. It followed a big acquisition just a week before that, which put the company’s market cap above $1 billion for the first time (at least for a moment). The ABJ reported that Upland, founded in 2013 and led by Jack McDonald, had one of the best stock track records among Austin companies at the time.
BOXX Technologies, an Austin startup that makes high-performance computers, joined with three data storage divisions under California-based Pacific Alliance Capital. Financial details weren’t provided, but the combined entities said they would report to Dallas-based private equity firm Craftsman Capital Partners.
June
Austin’s Data.world acquired Capsenta Inc., an Austin data analytics startup that spun out of the University of Texas, for an undisclosed amount. Capsenta develops software that integrates disparate databases using semantic-web technology. The deal was expected to allow businesses to securely access, view, and work with on-premises databases in the cloud.
Amazon acquired the ad server portion of Austin-based Sizmek, giving Amazon a powerful new tool to compete with ad server giant Google. AdAge reported that a source said Sizmek had been seeking around $30 million for the tech after filing for bankruptcy in March.
Locally based fintech company Q2 Holdings’ secondary stock offering brought in $527 million-plus via 3 million shares sold at $69.50 and convertible bonds, the ABJ reported. Big investment banks Morgan Stanley and J.P Morgan Securities underwrote the deal, with BMO Capital Markets Corp buying convertible bonds. The deal was expected to fuel some acquisitions. Q2’s market cap was, at the time, at about $3.6 billion.
July
Austin-based HotSchedules, which makes workforce and inventory management solutions for the restaurant industry, merged with London-based Fourth, which makes a platform to manage hospitality workforces. The move gave the combined company a substantially larger, end-to-end offering for the hospitality clients that includes scheduling, time and attendance, applicant tracking, training, inventory management, HR and payroll. Fourth CEO Ben Hood was expected to lead the combined company. The companies were to be co-headquartered in Austin and London, with other offices in Bulgaria, China, Australia and beyond.
VMware, a virtualization and cloud software company that is largely owned by Dell Technologies, acquired Bitfusion.io, a virtualization and graphic processing startup with offices in Austin and Sunnyvale, Calif. VMware announced the move in a blog post — terms of the deal weren't disclosed. The company said acquiring Bitfusion would expand its AI and machine learning-based by virtualizing hardware accelerators. After closing, VMware was expected to fold Bitfusion into its vSphere platform. Bitfusion, founded by Maciej Bajkowski, Mazhar Memon and Subbu Rama in 2015, had raised about $8.3 million, according to Crunchbase. Its investors have included Samsung Ventures, Vanedge Capital, Sierra Ventures, Geekdom and several others.
August
Spiceworks, an Austin company that has a marketplace and network for IT professionals, was acquired by New York-based Ziff Davis B2B, a global marketing company that operates brands including Mashable, PCMag and Offers.com. Financial details weren’t provided. The deal led the companies to layoff 59 employees in Austin. Spiceworks was founded in 2006 by Scott Abel, Francis Sullivan, Greg Kattawar and Hallberg.
Kony, an Austin-based digital app platform, was acquired by Switzerland banking software giant Temenos for an enterprise value of $559 million and a reported earn-out of $21 million. Kony was founded in 2007 and had raised just over $150 million in funding.
Austin childcare management software startup Preschool2me was acquired by Las Vegas-based SmartcareOS. The startup, founded in 2012 by Kapil Rajurkar, went through the Capital Factory Accelerator program and won a 1776 Challenge Cup in 2015. It had raised an unknown amount of seed funding from angel investors, including Jawahar Dhandapani, Sandeep Karandikar, Srinu Vemulapalli, Tarun Singhal, Tarun Sharma, Vipin Agrawal, Umad Ahmad, Vinay Arora and Saurabh Dixit, Silicon Hills News reported.
September
Hanger Technology, an Austin drone workflow automation startup, was acquired by Los Angeles-based AirMap, which provides airspace intelligence for drones. No financial details were provided. Hanger, founded in 2015 by Colin Guinn and Jeffrey DeCoux, had raised $6.5M from investors including Lux Capital, R/GA Ventures and Interlock Partners, according to Crunchbase. It will keep its headquarters and team in Austin.
Custom Church Apps, an Austin startup that makes mobile apps for churches, was acquired by Seattle-based church technology company Subsplash for undisclosed terms. Custom Church Apps was initially founded in Portland in 2012 by Poncho Lowder, Craig Wishart and Glenn Ray. It moved to Austin in 2017.
October
Austin real estate tech startup OJO Labs acquired fellow Austin real estate startup RealSavvy, the ABJ reported. Terms of the deal weren’t disclosed. RealSavvy, founded in 2014 by Rick Orr, had raised $6.2 million through debt financing backed by TIMIA Capital, Pathfinder, Capital Factory, StagedotO, Corsa Ventures and a few local angel investors, including Henry Yoshida and Chris Palmisano, according to Crunchbase. RealSavvy’s software helps realtors manage websites and customer relations. The deal marked OJO Labs’ first acquisition since it raised a $45 million round in March. In 2018, it scooped up Wolfnet Technologies.
Threatcare, which has raised funding from local venture capital firms and is known for its inclusive business practices, was scooped up by Tampa-based security company ReliaQuest. No financial details were provided. As part of the deal, Threatcare founder and CEO Marcus J. Carey was expected to work with ReliaQuest CTO Joe Partlow on integrating Threatcare’s tech into their product line and build out new products. All of Threatcare’s employees were expected to join ReliaQuest, and the Austin team will continue growing. Threatcare, founded in 2014 by Carey, provides cybersecurity attack simulations and has developed an AI-based security assistant for security teams. It has raised $2.1 million from investors, including Firebrand Ventures, Flyover Capital, Moonshots Capital, Techstars and Right Side Capital Management.
Austin sales software startup Olono was acquired by Boston-based InsightSquared. Terms of the deal weren’t disclosed. Olono was founded as Nexd in 2015 by James Davison, a former product manager at Austin-based SailPoint and IBM, and Dan Greff, a former director of engineering at SailPoint. It has raised around $7 million, which includes funding from ATX Venture Partners (formerly known as ATX Seed Ventures), Wildcat Venture Partners and angel investors including Bill Bock, former president of Silicon Laboratories, SailPoint co-founder Kevin Cunningham.
Austin-based software company Asure Software, which trades on Nasdaq as ASUR, sold its Workplace Management business to FM:Systems. The asset and equity deal was worth about $120M, the company said. Asure, led by CEO Pat Goepel, had grown its workplace software business from $5M to about $28M. The new deal will help the company expand its payroll, time and attendance and consulting businesses. Asure has made about 15 acquisitions in the past decade, including Payroll Maxx earlier this year, according to Crunchbase. The company was founded in 2007, although its previous iteration, Forgent Networks, dates back to the mid 1980s.
Intersys Consulting, an Austin-based IT consultancy, was acquired for $67M in cash by ASGN Inc., a major staffing company. Intersys will become part of ASGN’s Apex Systems division. Intersys, founded in 1993, expects to end 2019 with $31M in revenue.
November
JASK, a security operations software that moved its HQ to Austin recently, was acquired by Sumo Logic, a VC-backed California security event management startup that’s valued at more than $1 billion. JASK, founded in 2015, has raised nearly $40 million from investors like Battery Ventures, Dell Technologies Capital, TenEleven Ventures and Kleiner Perkins. Terms of the acquisition were not disclosed.
Atlanta fintech company NCR Corporation acquired Austin-based POS Solutions, which makes point-of-sale equipment and software. Terms of the deal weren’t announced. The company said it will maintain POS Solutions’ customer sites, as well as management team and staff in Austin.
Locally based predictive analytics software company Clockwork Solutions was acquired by Tysons, Va.-based LMI, a government consulting business formed in 1961. Terms of the deal weren’t disclosed. Clockworth, founded in 1983, lists itself as a Teakwood Capital Company. The company doesn’t appear to have raised any venture capital, according to Crunchbase.
December
Locally based IT services firm Flux7 is being acquired by Plano-based NTT DATA Services. The deal is expected to close by the end of the year. Flux7 was founded in 2013, and it’s led by CEO and co-founder Aater Suleman and CTO and co-founder Ali Hussain. Last April, it announced a new round of funding (amount undisclosed) from Bay Area firm NewWave Partners to build out its platform and expand its sales team.
Austin hotel tech startup Hotels for Hope is being acquired by Charlotte-based ticket and hospitality company QuintEvents. Terms of the deal weren’t disclosed, but QuintEvents said the it will help it add customizable, white-label booking platforms that centralize the hotel booking. Hotels for Hope, founded by Neil Goldman, has been a booking provider for Formula 1, Lollapalooza and other events. Hotels for Hope bills itself as a for-profit social enterprise, with $2 from every actualized room night going to nonprofits that help children.
