The company that acquired Updox disclosed the nine-figure purchase price while going public this summer, shortly after former CEO Michael Morgan left the merged company.
Denver-based EverCommerce Inc. paid $143 million cash for Updox – the largest of nine acquisitions totaling $415 million during a 2020 buying spree, according to regulatory filings from the company's IPO and its latest quarterly report. EverCommerce did not respond to a request for comment on the newly disclosed purchase price.
Dublin-based Updox grew almost entirely by revenue since a 2009 seed round, first taking on $12.7 million in growth equity in 2017. The round for an undisclosed stake included Central Ohio investors Rev1 Ventures and Tamarind Hill Fund LLC.
Morgan, who had led the software maker for nine years, stepped down in June, according to his LinkedIn profile. After EverCommerce acquired the company in December, he'd taken on a new title as brand president. Its 140 employees remained in Dublin's Bridge Park.
Zach Zettler, who had been COO, was promoted to Updox president, a spokeswoman said.
It's common for leaders of acquired high-growth tech companies to leave after helping with the transition, often to start something new, creating a flywheel effect in the community. Reached via LinkedIn, Morgan said he currently is an adviser to startups and could not comment on EverCommerce.
“It was all positive,” he said.
Terms of the deal were kept private when it was announced. Otherwise it would have ranked as the 15th-largest merger of the year involving an Ohio-based company, according to Columbus Business First research, and the largest for an in-state tech business.
"The success of Mike Morgan and the team at Updox is a powerful example of the types of companies scaling in Central Ohio," Ryan Helon, Rev1 executive vice president for investment funds, said via email.
"It's a big win," Mark Shary, an Updox co-founder and one of its biggest investors, said via email. The Tamarind Hill co-founder said he could not comment specifically on the deal.
John Weaver, co-founder and CEO of Gahanna-based 22 Ventures LLC and a longtime attorney to Central Ohio startups, as an outside observer called the Updox deal "a huge win."
"Anytime there's a liquidation event like this, it infuses capital and knowledge into the ecosystem," Weaver said. "I'm particularly excited about this exit, because it shows entrepreneurs that there are paths to huge exits that don't require regular infusions of cash and skyrocketing valuations. VC isn't right for every company, so it's always good to have examples to point to."
This spring, Athens-based biomedical freezer maker Stirling Ultracold was acquired for $234 million, mostly in stock, according to the latest quarterly report of buyer BioLife Solutions Inc. Other recent tech acquisitions in which terms were kept private were fintech firm Bold Penguin and arts audition platform Acceptd.
EverCommerce was valued at $3.5 billion with its July IPO; at current share prices its market capitalization is $3 billion, according to its Nasdaq listing. It had been valued at $2 billion in a 2019 investment round.
The company aims to become the world's largest platform for software-as-a-service brands tailored to small- and medium-sized businesses, according to sister publication Denver Business Journal. About half its revenue is from a collection of services to home improvement professionals, according to its first quarterly earnings call as a public company.
Updox is among a collection of brands serving physician practices and other healthcare businesses. Its secure communication, patient portal and business productivity software is used in doctors' offices, hospitals and pharmacies. Use skyrocketed in 2020 as Updox rolled out video chat just in time for the widespread rapid adoption of telehealth in the coronavirus pandemic.
"As an early pre-seed investor, Rev1 is proud to support Updox and all businesses that focus on delivering a compelling solution that fits a clear market need," Helon said. "The EverCommerce acquisition validates the significant value the Updox team has built over the last decade, and we know they will continue revolutionizing the healthcare industry.”
Shary had been founding CEO, bringing in Morgan once the software hit proof-of-concept.
"He’s as good an early-stage, operating-oriented tech CEO as you're going to find," Shary said when the acquisition was announced in December.
