Bestpass, an upstate New York-based toll payment platform for trucking fleets, has completed the acquisition of a Wisconsin software firm that will double its employee head count.
The Albany, New York-based company closed on the acquisition of Madison-based company Fleetworthy Solutions this month. Terms of the deal were not disclosed.
Bestpass CEO Tom Fogarty said the acquisition is an opportunity to provide more services to customers.
"We've actually been partners with Fleetworthy for three and a half years now. And so it's a longstanding partnership relationship," Fogarty said. "We have several customers that are shared, like CVS, the big pharmacy chain, and things like that. The customers were liking the joint solution a lot."
Fogarty said the idea for the deal came after a multimillion-dollar investment into Bestpass in June from Insight Partners, a global software investor. He said the investors were able to provide growth support.
"They had a lot of great expertise to help us. But I really picked them for what you pick investors for, which is to help do things with the money, to build value for your company and for your customers. So that was the beginning of the journey," he said.
Fleetworthy provides compliance services for truck fleets. Similar to how Bestpass has automated tolls for trucks, Fleetworthy has automated the process for licensing, inspection, maintenance and background checks with its dashboard. That ensures transportation providers are in compliance with U.S. Department of Transportation regulations governing such things as safety and protection of the environment.
Fogarty said Fleetworthy has had success working with large, private fleets, like Pepsi, Walmart or Target, which has been an area to grow for Bestpass, which already works with many for-hire fleets, like JB Hunt, FedEx and UPS. Bestpass has 30,000 customers.
"When I go out and talk to our customers, I ask, 'What more can we do for you?' ... more often, it's like, 'You guys do toll so well, but we really wish you would do things like licensing, inspections and safety,' and these other areas which are highly manual and complex for them," Fogarty said. "All those things that you have to do as a fleet to prove that you can run a good operation."
Fleetworthy, which has 3,000 customers, is about two-thirds the size of Bestpass by revenue, Fogarty said. The acquisition will double Bestpass' head count to 300 employees.
"They've got a lot more people in operations, where we've got a lot more people in engineering and sales and marketing," he said.
Fogarty said the transition will take place over the next six to nine months.
Because of the acquisition, Bestpass will have dual headquarters in Albany and Madison. But Fogarty anticipates the company will be opening more positions in Albany as the company moves through the integration process.
"I think there's going to be more and more opportunity as we build the next great technology business in the Capital District," he said.
In the short term, both companies will continue to operate under their respective brands.
Raymond James and DC Advisory acted as financial advisers to Fleetworthy. Former Fleetworthy president/CEO Michael Precia is now president/chief strategy officer at Bestpass/Fleetworthy.
Bestpass' last acquisition was one year ago, when it purchased a product line from a Charlotte-based company.
