A trio of longtime leaders in the local technology and investing spaces have launched a new Minneapolis-based software holding company.
Big Band Software launched Tuesday by industry veterans Kevin McArdle, Chris Reedy and Jason Heath. The new company, backed by Chicago-based ParkerGale and Columbus, Ohio-based Talisman Capital Partners, plans to deploy up to $100 million over the course of three to five years by acquiring business-to-business software-as-a-service companies.
Technically a private equity firm, Big Band goes beyond what traditional PE firms do, by building up companies and owning them for as long as possible, CEO McArdle said. McArdle founded and was previously CEO of Edina-based investment firm SureSwift Capital, as well as vice president of Cerner, a provider of health care software that was later acquired by Oracle Corp.
The new company represents an opportunity for those smaller, bootstrapped software companies to be acquired, said Reedy, Big Band's head of acquisitions, who formerly had roles at SureSwift, Royal Street Ventures and Gopher Angels.
Big Band intends to be a good steward for what those businesses have started, he added.
“Our team has a passion to partner with small-business owners who have created a successful company that they want to sell, but also want to stay committed to their company that they have put their blood, sweat and tears into,” he said in an announcement on the launch.
Big Band would look to continue to grow the acquired businesses for long-term profitability while allowing them to each have their own CEO and culture, McArdle said in the announcement.
The company is initially targeting businesses in the $1 million to $10 million annual revenue range, which is below the typical acquiring zone of similar acquiring firms, Reedy added.
Of the $100 million the company plans to deploy, some of that is already committed capital and some is still in the process, McArdle said.
While the firm is deeply rooted in the Minnesota ecosystem and both of its lead investors are based in the Midwest, acquisitions will be made both nationally and internationally, Reedy and McArdle said.
And despite concerns about the state of technology, such as headlines about layoffs, this launch represents a show of optimism with a “very ambitious set of goals” for the industry, McArdle said.
One of Big Band's founding partners, Heath, who is serving as head of operations, has had a long career in tech with roles at GoDaddy and software firms Leadpages and WebPT Inc.
