For Umbrage CEO Will Womble, Boston-based Bain & Co. buying his startup was a milestone for growth but is not the finish line for the Houston-based digital studio.
The deal was finalized in early February after nearly a year of negotiations, Womble told the Houston Business Journal. He could not disclose financial terms of the agreement but said that Umbrage will operate as a branded service line of the consulting firm.
“Bain came to the realize that Umbrage is not integrating,” Womble said. “If you had asked me if that was going to be the case [before the deal closed], I would have said, 'Yeah, that would be an awesome goal.'”
Umbrage provides a software studio and resources to help new companies get their infrastructure and scaling underway. Womble described Umbrage as bridging the gap between information technology and the business side for clients, which tend to be startups backed by Fortune 100 companies.
Umbrage had not been looking for an acquisition, Womble said, but Bain & Co. came across the studio after looking for a Southern U.S. expansion to its existing venture architect line, which helps build new companies.
“It helped that the capability we had was a little different and something that they were wanting to add,” Womble said. “Our proximity was very interesting, both being in Texas and Houston, but also with access to the Southern Hemisphere.”
Umbrage’s services evolved from simply being a digital studio after the team noticed companies had trouble managing their IT-business gap. The company's evolution since it was founded in 2019 caught the attention of Bain & Co. in 2022.
“We didn't ever want to become beholden to a deal having to happen,” Womble said. “We were blessed to get cashflow positive from day one, and we maintained cashflow positivity until the end, even if we had to dip low in some buckets.”
Umbrage also saw an expansion in its clientele with a growth of Web3 — a blockchain-driven new stage of the internet — in 2022. Previously, the company mainly dealt with energy giants such as BP and Exxon Mobil Corp. Throughout last year, Umbrage found considerable business dealing with clients who wanted to incorporate Web3 while still managing their current internet infrastructure, Womble said.
“As entities start to dabble more and more in Web3, there isn’t a clear line between when [the current infrastructure] ends and Web3 begins,” Womble said.
The specific opportunity that sparked Umbrage’s Web3 expansion came at the end of 2021 when the company had the chance to work with New York-based blockchain company Digital Asset on a client’s project, Womble said.
Umbrage is not Womble’s first startup, having previously been involved with Austin-based AI startup Hypergiant. He also worked at Accenture and spent several years as a practicing prosecutor with the Harris County District Attorney’s Office. However, basing Umbrage in Houston both allowed the company to tap into large energy companies for clientele and build an idea in his hometown.
“I knew Houston was this nascent opportunity to build something,” Womble said. “All of [these startup ideas] have been bubbling, and the challenge is how do you leverage the innovation ecosystem and stand on your own.”
Womble said he intended to stay with Umbrage and rejected the possibility of moving on to another startup and becoming known as a "serial entrepreneur."
“It’s my belief that successful companies are the ones that are attractive for acquisition,” Womble said. “If you’re building a company to get bought, they rarely get bought. I hope [Umbrage’s employees] all feel appreciated and valued by the Bain acquisition, but I know they are just as hungry to keep doing what they do.”
Umbrage currently has nearly 90 employees, with the majority in Houston and others working in 14 U.S. states and in Monterrey, Mexico, Womble said. The company’s office and studio are based in Houston's East End District.
In 2021, Umbrage closed a $2 million seed financing round. The funding round was led by Rice Investment Group, a $200 million investment fund based in Carnegie, Pennsylvania.
