Kong acquires Insomnia, launches Kong Studio for API development

API and microservices platform Kong today announced that it has acquired Insomnia, a popular open-source tool for debugging APIs. The company, which also recently announced that it had raised a $43 million Series C round, has already put this acquisition to work by using it to build Kong Studio, a tool for designing, building and maintaining APIs for both REST and GraphQL endpoints.

As Kong CEO and co-founder Augusto Marietti told me, the company wants to expand its platform to cover the full service life cycle. So far, it has mostly focused on the runtime, but now it wants to enable developers to also design and test their services. “We looked at the space and Insomnia is the number one open source API testing platform,” he told me. “And we thought that by having Insomnia in our portfolio, we will get the pre-production part of things and on top of that, we’ll be able to build Kong Studio, which is kind of the other side of Insomnia that allows you to design APIs.”

For Oct. 2 Kong News Kong Service Control Platform

Insomnia launched in 2015, as a side project of its sole developer, Greg Schier. Schier quit his job in 2016 to focus on Insomnia full-time and then open-sourced it in 2017. Today, the project has 100 contributors and the tool is used by “hundreds of thousands of developers,” according to Schier.

Marietti says both the open-source project and the paid Insomnia Plus service will continue to operate as before.

In addition to Kong Studio and the Insomnia acquisition, the company also today launched the latest version of its Enterprise service, the aptly named Kong Enterprise 2020. New features here include support for REST, Kafka Streams and GraphQL. Kong also launched Kong Gateway 2.0 with additional GraphQL support and the ability to write plugins in Go.


By Frederic Lardinois

How founder and CTO Dries Buytaert sold Acquia for $1B

Acquia announced yesterday that Vista Equity Partners was going to buy a majority stake in the company worth a $1 billion. That would seem to be reason enough to sell the company. That’s a good amount a dough, but as co-founder and CTO Dries Buytaert told Extra Crunch, he’s also happy to be taking care of his early investors and his long-time, loyal employees who stuck by him all these years.

Vista is actually buying out early investors as part of the deal, while providing some liquidity for employee equity holders. “I feel proud that we are able to reward our employees, especially those that have been so loyal to the company and worked so hard for so many years. It makes me feel good that we can do that for our employees,” he said.

Image via TechCrunch


By Ron Miller

Ten years after Adobe bought Omniture, the deal comes into clearer focus

Ten years ago this week, Adobe acquired Omniture for $1.8 billion. At the time, Adobe was a software company selling boxed software like Dreamweaver, Flash and Photoshop to creatives. Many people were baffled by the move, not realizing that purchasing a web analytics company was really the first volley in a full company transformation to the cloud and a shift in focus from consumer to enterprise.

It would take many years for the full vision to unfold, so you can forgive people for not recognizing the implications of the acquisition at the time, but CEO Shantanu Narayen seemed to give an inkling of what he had in mind. “This is a game-changer for both Adobe and our customers. We will enable advertisers, media companies and e-tailers to realize the full value of their digital assets,” he said in a statement after the acquisition became public.

While most people thought that perhaps this move involved some sort of link between design and data, it would turn out to be more complex than that. Tony Byrne, founder and principal analyst at Real Story Group, tried to figure out the thinking behind the deal in an EContent column published a couple of months after it was announced.

“Going forward, I think the real action will continue to revolve around integrating management and metrics, less so than integrating design and metrics. And that’s why I also think that Adobe isn’t done acquiring yet,” It was pure speculation on Byrne’s part, but it proved prescient.

There’s something happening here


By Ron Miller

Palo Alto Networks intends to acquire Zingbox for $75M

Palo Alto Networks surely loves to buy security startups. Today it added to its growing collection when it announced its intent to acquire IoT security startup Zingbox for $75 million.

The company had raised $23.5 million, according to Crunchbase data. The three co-founders, Xu Zou, May Wang and Jianlin Zeng, will be joining Palo Alto after the sale is official.

With Zingbox, the company gets IoT security chops, something that is increasingly important as companies deploy internet-connected smart devices and sensors. While these tools can greatly benefit customers, they also often carry a huge security risk.

Zingbox, which was founded in 2014, gives Palo Alto a modern cloud-based solution built on a subscription model along with engineering talent to help build out the solution further. Nikesh Arora, chairman and CEO of Palo Alto Networks, certainly sees this.

“The proliferation of IoT devices in enterprises has left customers facing an enormous gap in protection against cybersecurity attacks. With the proposed acquisition of Zingbox, we will provide a first-of-its-kind subscription for our Next-Generation Firewall and Cortex platforms that gives customers the ability to gain control, visibility and security of their connected devices at scale,” Arora said in a statement.

This is the fourth security startup the company has purchased this year. It acquired two companies, nabbing PureSec and Twistlock, on the same day last Spring. Earlier this year, it bought Demisto for $560 million. All of these acquisitions are meant to build up the company’s portfolio of modern security offerings without having to build these kinds of tools in-house from scratch.


By Ron Miller

How Pivotal got bailed out by fellow Dell family member, VMware

When Dell acquired EMC in 2016 for $67 billion, it created a complicated consortium of interconnected organizations. Some, like VMware and Pivotal, operate as completely separate companies. They have their own boards of directors, can acquire companies and are publicly traded on the stock market. Yet they work closely within the Dell, partnering where it makes sense. When Pivotal’s stock price plunged recently, VMware saved the day when it bought the faltering company for $2.7 billion yesterday.

Pivotal went public last year, and sometimes struggled, but in June the wheels started to come off after a poor quarterly earnings report. The company had what MarketWatch aptly called “a train wreck of a quarter.”

How bad was it? So bad that its stock price was down 42% the day after it reported its earnings. While the quarter itself wasn’t so bad, with revenue up year over year, the guidance was another story. The company cut its 2020 revenue guidance by $40-$50 million and the guidance it gave for the upcoming 2Q19 was also considerably lower than consensus Wall Street estimates.

The stock price plunged from a high of $21.44 on May 30th to a low of $8.30 on Aug 14th. The company’s market cap plunged in that same time period falling from $5.828 billion on May 30th to $2.257 billion on Aug 14th. That’s when VMware admitted it was thinking about buying the struggling company.


By Ron Miller

Why chipmaker Broadcom is spending big bucks for aging enterprise software companies

Last year Broadcom, a chipmaker, raised eyebrows when it acquired CA Technologies, an enterprise software company with a broad portfolio of products, including a sizable mainframe software tools business. It paid close to $19 billion for the privilege.

Then last week, the company opened up its wallet again and forked over $10.7 billion for Symantec’s enterprise security business. That’s almost $30 billion for two aging enterprise software companies. There has to be some sound strategy behind these purchases, right? Maybe.

Here’s the thing about older software companies. They may not out-innovate the competition anymore, but what they have going for them is a backlog of licensing revenue that appears to have value.


By Ron Miller

Salesforce is acquiring ClickSoftware for $1.35B

Another day, another Salesforce acquisition. Just days after closing the hefty $15.7 billion Tableau deal, the company opened its wallet again, this time announcing it has bought field service software company ClickSoftware for a tidy $1.35 billion.

This one is designed to beef up the company’s field service offering under the Service Cloud umbrella. In its June earnings report, the company reported that Service Cloud crossed the $1 billion revenue threshold for the first time. This acquisition is designed to keep those numbers growing.

“Our acquisition of ClickSoftware will not only accelerate the growth of Service Cloud, but drive further innovation with Field Service Lightning to better meet the needs of our customers,” Bill Patterson, EVP and GM of Salesforce Service Cloud said in a statement announcing the deal.

ClickSoftware is actually older than Salesforce having been founded in 1997. The company went public in 2000, and remained listed until it went private again in 2015 in a deal with private equity company Francisco Partners, which bought it for $438 million. Francisco did alright for itself, holding onto the company for four years before more than doubling its money.

The deal is expected to close in the Fall and is subject to the normal regulatory approval process.


By Ron Miller

Why AWS gains big storage efficiencies with E8 acquisition

AWS is already the clear market leader in the cloud infrastructure market, but it’s never been an organization that rests on its past successes. Whether it’s a flurry of new product announcements and enhancements every year, or making strategic acquisitions.

When it bought Israeli storage startup E8 yesterday, it might have felt like a minor move on its face, but AWS was looking, as it always does, to find an edge and reduce the costs of operations in its data centers. It was also very likely looking forward to the next phase of cloud computing. Reports have pegged the deal at between $50 and $60 million.

What E8 gives AWS for relatively cheap money is highly advanced storage capabilities, says Steve McDowell, senior storage analyst at Moor Research and Strategy. “E8 built a system that delivers extremely high-performance/low-latency flash (and Optane) in a shared-storage environment,” McDowell told TechCrunch.


By Ron Miller

Salesforce closes $15.7B Tableau deal

In an amazingly quick turn-around for a deal of this scope, Salesforce announced today that it has closed the $15.7 billion Tableau deal announced in June. The deal is by far the biggest acquisition in Salesforce history, a company known for being highly acquisitive.

A deal of this size usually faces a high level of regulatory scrutiny and it can take six months or longer to close, but this one breezed through the process and closed in under two months.

With Tableau, and Mulesoft, a company it bought last year for $6.5 billion, in the fold, Salesforce has a much broader view of the enterprise than it could as a pure cloud company. It has access to data wherever it lives, whether on premises or in the cloud, and with Tableau, it enables customers to bring that data to life by visualizing it.

This was a prospect that excited Salesforce chairman Marc Benioff. “Tableau will make Salesforce Customer 360, including Salesforce’s analytics capabilities, stronger than ever, enabling our customers to accelerate innovation and make smarter decisions across every part of their business,” Benioff said in a statement.

As with any large acquisition involving two enormous organizations, combining them could prove challenging, and the real test of this deal, once the dust has settled, will be how smoothly that transition happens and how well the companies can work together and become a single entity under the Salesforce umbrella.

In theory, having Tableau gives Salesforce another broad path into larger and more expansive enterprise sales, but the success of the deal will really hinge on how well it folds Tableau into the Salesforce sales machine.


By Ron Miller

Amazon acquires flash-based cloud storage startup E8 Storage

Amazon has acquired Isreali storage tech startup E8 Storage, as first reported to Reuters, CNBC and Globes and confirmed by TechCrunch. The acquisition will bring the team and technology from E8 in to Amazon’s existing Amazon Web Services center in Tel Aviv, per reports.

E8 Storage’s particular focus was on building storage hardware that employs flash-based memory to deliver faster performance than competing offerings, according to its own claims. How exactly AWS intends to use the company’s talent or assets isn’t yet known, but it clearly lines up with their primary business.

AWS acquisitions this year include TSO Logic, a Vancouver-based startup that optimizes data center workload operating efficiency, and Israel-based CloudEndure, which provides data recovery services in the event of a disaster.


By Darrell Etherington

Microsoft acquires data privacy and governance service BlueTalon

Microsoft today announced that it has acquired BlueTalon, a data privacy and governance service that helps enterprises set policies for how their employees can access their data. The service then enforces those policies across most popular data environments and provides tools for auditing policies and access, too.

Neither Microsoft nor BlueTalon disclosed the financial details of the transaction. Ahead of today’s acquisition, BlueTalon had raised about $27.4 million, according to Crunchbase. Investors include Bloomberg Beta, Maverick Ventures, Signia Venture Partners and Stanford’s StartX fund.

BlueTalon Policy Engine How it works

“The IP and talent acquired through BlueTalon brings a unique expertise at the apex of big data, security and governance,” writes Rohan Kumar, Microsoft’s corporate VP for Azure Data. “This acquisition will enhance our ability to empower enterprises across industries to digitally transform while ensuring right use of data with centralized data governance at scale through Azure.”

Unsurprisingly, the BlueTalon team will become part of the Azure Data Governance group, where the team will work on enhancing Microsoft’s capabilities around data privacy and governance. Microsoft already offers access and governance control tools for Azure, of course. As virtually all businesses become more data-centric, though, the need for centralized access controls that work across systems is only going to increase and new data privacy laws aren’t making this process easier.

“As we began exploring partnership opportunities with various hyperscale cloud providers to better serve our customers, Microsoft deeply impressed us,” BlueTalon CEO Eric Tilenius, who has clearly read his share of “our incredible journey” blog posts, explains in today’s announcement. “The Azure Data team was uniquely thoughtful and visionary when it came to data governance. We found them to be the perfect fit for us in both mission and culture. So when Microsoft asked us to join forces, we jumped at the opportunity.”


By Frederic Lardinois

The Exit: The acquisition charting Salesforce’s future

Before Tableau was the $15.7 billion key to Salesforce’s problems, it was a couple of founders arguing with a couple of venture capitalists over lunch about why its Series A valuation should be higher than $12 million pre-money.

Salesforce has generally been one to signify corporate strategy shifts through their acquisitions, so you can understand why the entire tech industry took notice when the cloud CRM giant announced its priciest acquisition ever last month.

The deal to acquire the Seattle-based data visualization powerhouse Tableau was substantial enough that Salesforce CEO Marc Benioff publicly announced it was turning Seattle into its second HQ. Tableau’s acquisition doesn’t just mean big things for Salesforce. With the deal taking place just days after Google announced it was paying $2.6 billion for Looker, the acquisition showcases just how intense the cloud wars are getting for the enterprise tech companies out to win it all.

The Exit is a new series at TechCrunch. It’s an exit interview of sorts with a VC who was in the right place at the right time but made the right call on an investment that paid off. [Have feedback? Shoot me an email at [email protected]]

Scott Sandell, a general partner at NEA (New Enterprise Associates) who has now been at the firm for 25 years, was one of those investors arguing with two of Tableau’s co-founders, Chris Stolte and Christian Chabot. Desperate to close the 2004 deal over their lunch meeting, he went on to agree to the Tableau founders’ demands of a higher $20 million valuation, though Sandell tells me it still feels like he got a pretty good deal.

NEA went on to invest further in subsequent rounds and went on to hold over 38% of the company at the time of its IPO in 2013 according to public financial docs.

I had a long chat with Sandell, who also invested in Salesforce, about the importance of the Tableau deal, his rise from associate to general partner at NEA, who he sees as the biggest challenger to Salesforce, and why he thinks scooter companies are “the worst business in the known universe.”

The interview has been edited for length and clarity. 


Lucas Matney: You’ve been at this investing thing for quite a while, but taking a trip down memory lane, how did you get into VC in the first place? 

Scott Sandell: The way I got into venture capital is a little bit of a circuitous route. I had an opportunity to get into venture capital coming out of Stanford Business School in 1992, but it wasn’t quite the right fit. And so I had an interest, but I didn’t have the right opportunity.


By Lucas Matney

With $34B Red Hat deal closed, IBM needs to execute now

In a summer surprise this week, IBM announced it had closed its $34 billion blockbuster deal to acquire Red Hat. The deal, which was announced in October, was expected to take a year to clear all of the regulatory hurdles, but U.S. and EU regulators moved surprisingly quickly. For IBM, the future starts now, and it needs to find a way to ensure that this works.

There are always going to be layers of complexity in a deal of this scope, as IBM moves to incorporate Red Hat into its product family quickly and get the company moving. It’s never easy combining two large organizations, but with IBM mired in single-digit cloud market share and years of sluggish growth, it is hoping that Red Hat will give it a strong hybrid cloud story that can help begin to alter its recent fortunes.

As Box CEO (and IBM partner) Aaron Levie tweeted at the time the deal was announced, “Transformation requires big bets, and this is a good one.” While the deal is very much about transformation, we won’t know for some time if it’s a good one.

Transformation blues


By Ron Miller

KKR confirms it has acquired Canadian software company Corel, reportedly for over $1B

Yesterday we broke the news that Corel — the company behind WordPerfect, Corel Draw, and a number of other apps, as well as the new owner of Parallels — had itself gotten acquired by KKR. Today, the news is confirmed and official: KKR today announced that it has closed the deal, purchasing Corel from private equity firm Vector Capital.

The terms of the acquisition are not being disclosed, but when the first rumors of a deal started to emerge a couple of months ago, the price being reported was over $1 billion.

Corel may not be the first name you think of in the world of apps and software today. Founded in the 1980s as one of the first big software companies to capitalize on the first wave of personal computer ownership, it tried to compete against Microsoft in those early days (unsuccessfully), and has seen a lot of ups and downs, including two retreats from the stock market, an insider trading scandal, and patent disputes (and even detentes) with its onetime rival.

But in more recent years it has, under the radar, built itself to be a solid and — in these days of startups that claim to intentionally operate at a loss for years in order to scale — profitable business with 90 million users. (Vector had said in the past that Corel had paid dividends of $300 million over the years it’s owned the company.)

Founded in the days when you went to electronics store and bought physical boxes of software with installation disks and hefty manuals, Corel has brought itself into the modern era, with acquisitions like Parallels — a virtualization giant that lets businesses run far-flung and very fragmented networks as if they weren’t — underscoring that strategy.

And that is where KKR appears to be putting its focus. In the memo that a source passed us yesterday, Corel’s CEO Patrick Nichols assured staff that there would be no layoffs and that this acquisition would mean a significant new infusion of capital both to expand its existing business as well as to make more acquisitions to grow. (As we pointed out yesterday, there are a lot of very promising software startups in the market today, and not all of them will scale on their own, so that could present interesting opportunities for companies like Corel.)

“Corel has differentiated itself by offering an impressive portfolio of essential tools and services for connected knowledge workers – across devices, operating systems, and a range of fast-growing industries. KKR looks forward to working together with management to drive continued growth across its existing platforms while leveraging the team’s extensive experience in M&A to deliver a new chapter of innovation and growth on a global scale,” said John Park, Member at KKR, in a statement.

That’s not to say that Corel does not have a specific strategy in mind. The company has apps and services today in three verticals serving consumers (mostly “prosumers”) and so-called knowledge workers: Creativity, Productivity, and Desktop-as-a-Service. That will likely be the trajectory that it will continue to pursue as it looks for more growth.

Although Vector is known as a tech investor, KKR is another step up in to the “bigger” leagues, and so it will be interesting see what Corel can do with the larger coffers, and the larger network of contacts, that KKR will bring to the table.

“KKR recognizes the value of our people and their impressive achievements, especially in terms of our commitment to customers, technology innovation, and our highly successful acquisition strategy. With KKR’s support and shared vision, our management team is excited by the opportunities ahead for our company, products, and users,” said Patrick Nichols, CEO of Corel, in a statement.

If reports of the acquisition price are accurate, that would represent a big premium to Vector: over the last 16 years the PE firm had acquired, taken public, and reacquired Corel, paying no more than $124 million for the company in those two acquisitions (the second time, it paid just $30 million).

“Corel has been an important part of the Vector Capital family for many years and we are pleased to have achieved a fantastic outcome for our investors with the sale to KKR,” said Alex Slusky, Vector Capital’s Founder and Chief Investment Officer, in a statement. “Under Vector’s ownership, Corel completed multiple transformative acquisitions, grew revenue and meaningfully improved profitability, highlighting Vector’s proven strategy of partnering with management teams to position companies for long-term success.  We are confident the company has found a great partner with KKR and wish them continued success together.”

 


By Ingrid Lunden

KKR has acquired Corel (including its recent acquisition Parallels), reportedly for $1B+

Only six months after snapping up virtualization specialist Parallels, Canadian software company Corel is itself getting acquired. TechCrunch has learned and confirmed with multiple sources that private equity giant KKR has closed a deal to buy the company from Vector Capital, which has owned some or all of Corel since 2003.

KKR’s interest in Corel was first rumored in May, when PE Hub reported the two were in talks for a sale valued at over $1 billion. At the time, representatives of Corel declined to comment, although our sources inside the company indicated that the reports were not inaccurate.

Fast forward to today, and both KKR and and a spokesperson for Parallels/Corel declined to comment. But, we now have a copy of the memo provided by an internal source that has been sent out to staff announcing that the deal has indeed closed, and that Corel is now officially part of the KKR family of companies.

According to the memo, KKR is very optimistic about Corel’s prospects. It plans to give Corel an “infusion of capital” to accelerate its growth, which will go into two areas. First will be expanding operations for the existing business: Corel is the company behind a number of longstanding software brands including WordPerfect, Corel Draw, WinZip, PaintShop Pro. Second will be making acquisitions (and the sheer proliferation of promising startups in the last decade dedicated to all variety of apps and other software that may have found it a challenge to scale means Corel could have rich pickings).

There are no layoffs planned as part of the deal, and the official announcement had been planned to go out next week, but now looks like it may be moved up to tomorrow (Wednesday).

Vector and Corel itself have never publicly disclosed much on user numbers or financials, but Vector has described the company as “highly profitable”, with dividends of over $300 million to date. The memo we’ve seen notes that Corel (including Parallels) has millions of customers across its various software platforms and apps.

The acquisition of Corel by KKR marks another chapter in the company’s long corporate history.

Founded in the 1980s — when personal computers were just starting to enter the mainstream but well before we had anything like the internet (not to mention the world of cloud-based apps) that we know today — Corel once positioned itself as a potential competitor to Microsoft in the software wars.

When Corel purchased WordPerfect from Novel in 1996, Corel founder Michael Cowpland viewed the software package as an integral part of that rivalry, describing it as the Pepsi to Microsoft’s Coke — that is, Word.

Microsoft proved the mightier of the two, and it even eventually signed a partnership with Corel that saw it investing in the company: a sell out, as one disappointed Canadian journalist described it at the time. The two have also sparred over patents.

Corel, which went public early in its life, got battered in the first dot-com bust (which was not helped by an insider trading scandal that led to Cowpland’s departure). Vector stepped in and took it private in 2003.

After restructuring the company, Vector listed Corel again in 2006. But, amid another recession that again hit Corel hard, it once more took it private in 2010. In the intervening years, Corel has been focused on modernising its offerings, bringing in e-commerce, direct downloads, subscriptions, and acquisitions to bring the company’s products and wider business closer to how consumers and workers use computers today.

Parallels was a part of that strategy: its products help people work seamlessly across multiple platforms, letting employees (and IT managers) run a unified workflow regardless of the device or operating system, with Parallels providing support for Windows, Mac, iOS, Android, Chromebook, Linux, Raspberry Pi and cloud — a timely offering in the current, fragmented IT market.

If the $1 billion+ figure is accurate, that strategy seems to have worked: across the two times that Vector took Corel private, it never paid more than $124 million for the company (the second time, as its stock was tanking, it paid just $30 million).


By Ingrid Lunden