User-generated e-learning site Kahoot acquires Actimo for up to $33M to double down on corporate sector

Norwegian company Kahoot originally made its name with a platform the lets educators and students create and share game-based online learning lessons, in the process building up a huge public catalogue of gamified lessons created by its community. Today the startup — now valued at over $2 billion — is announcing an acquisition to give a boost to another segment of its business: corporate customers.

Kahoot has acquired Danish startup Actimo, which provides a platform for businesses to train and engage with employees. Kahoot said that the purchase is being made with a combination of cash and shares, and works to to a total enterprise value of between $26 million and $33 million for the smaller company, with the sale expected to be completed in October 2020.

It may sound like a modest sum in a tech market where companies are currently and regularly seeing paper valuations in the hundreds of millions at Series A stage, but it also presents a different kind of trajectory both for founders and their investors.

This is actually a strong exit for Actimo, which had raised less than $500,000, according to data from PitchBook. And it puts Actimo under the wing of a company that has been scaling globally fast, finding — like others in the areas of online education and remote working — that the current state of social distancing due to Covid-19 is resulting in a boost to its business.

To give you an idea of the scale and growth of Kahoot, the company says that currently it has over 1 billion active users, on top of some 4.4 billion users in aggregate since first launching the platform in 2013. In the last 12 months, some 200 games have been played on its platform. In June, when Kahoot announced that it had raised $28 million in funding, it told us that 100 million games had been played.

In light of its growth and the future opportunity — even putting aside the progression of the coronavirus, it looks like remote work and remote learning will at the least become a lot more common as a longer-term option — the company has also seen a rise in its valuation. With some of its shares traded on the Merkur Market in Norway, the company currently has a market cap of 18.716 billion Norwegian Krone, which at today’s rates is about $2.08 billion. That figure was $1.4 billion in June.

Kahoot’s targeting of the corporate sector is not new. The company has been building a business in this space for years. It says that in the last 12 months, it logged 2 million sessions across 20 million participating “players” of its corporate training “games”, with some 97% of the Fortune 500 among those users. Customers include the likes of Facebook (for sales training), Oyo (hospitality training and onboarding) and Qualys (for taking polls during a conference), among others.

Critically, while a lot of Kahoot’s audience is in education, its corporate most of the revenues come in, one reason why it’s keen to grow that segment with more services and users.

The aim with Actimo, Kahoot says, is to build out a product set aimed at helping organisations with company culture — which, with many organisations now going on eight months and counting of entire teams working regularly outside of their physical offices, has grown as a priority.

Keeping a team feeling like a team, and an individual feeling more than a transactional regard for an employer, is not a simple thing in the best of times. Now, as we continue to work physically away from each other, it will take even more tools and efforts to get the balance right.

In that context, Actimo’s solution is just one aspect, but potentially an interesting one: it has built a platform where employees can track the training that they have done or need to do, engage with other co-workers, and provide feedback, and employers can use it to generally track and encourage how employees are engaging across the company and its various efforts. It counts some 200 enterprises, including Circle K, Hi3G, and Compass Group, among its customers, and has current ARR of $5 million.

For comparison, Kahoot, in its Q2 financials published in August, reported ARR of $25 million, with invoiced revenue for the quarter at $9.6 million, growing some 317% on the same quarter a year before. The company has also raised some $110 million in private funding from the likes of Microsoft and Disney.

As Kahoot looks to find more than just a transient place in a company’s IT and software fabric — transience of attention always being a risk with anything gaming-based — it makes a lot of sense to pick up Actimo and work on ways of coupling the platform with its other corporate work. You can also imagine a time when it might create a similar kind of dashboard for the educational sector.

“We are excited to welcome the Actimo team to be part of the fast-growing Kahoot! family,” said Kahoot! CEO, Eilert Hanoa, in a statement. “This acquisition will further extend Kahoot!’s corporate learning offerings, by providing solutions tailored for the frontline segment, as well as to solidify company culture and engagement among remote and distributed teams in companies of all types and sizes. This continues our expressed ambition to also grow through M&A by adding strategic capabilities that we can leverage across our global platform.”

“We are thrilled to join forces with Kahoot! in our mission to develop next-level solutions that connect remote employees and boost employee engagement and productivity,” said Eske Gunge, CEO at Actimo, in a statement. “Being part of Kahoot! and with our experience from working with innovative and ambitious enterprises across industries, we can together set a new standard for corporate learning and engagement.”


By Ingrid Lunden

Progress snags software automation platform Chef for $220M

Progress, a Boston area developer tool company, boosted its offerings in a big way today when it announced it was acquiring software automation platform Chef for $220 million.

Chef, which went 100% open source last year, had annual recurring revenue (ARR) of $70 million from the commercial side of the house. Needless to say, Progress CEO Yogesh Gupta was happy to bring the company into the fold and gain not only that revenue, but a set of highly skilled employees, a strong developer community and an impressive customer list.

Gupta said that Chef fits with his company’s acquisition philosophy. “This acquisition perfectly aligns with our growth strategy and meets the requirements that we’ve previously laid out: a strong recurring revenue model, technology that complements our business, a loyal customer base and the ability to leverage our operating model and infrastructure to run the business more efficiently,” he said in a statement.

Chef CEO Barry Crist offered a typical argument for an acquired company, that Progress offered  a better path to future growth, while sending a message to the open source community and customers that Progress would be a good steward of the startup’s vision.

“For Chef, this acquisition is our next chapter, and Progress will help enhance our growth potential, support our Open Source vision, and provide broader opportunities for our customers, partners, employees and community,” Crist said in a statement.

Chef’s customer list is certainly impressive including tech industry stalwarts like Facebook, IBM and SAP, as well as non-tech companies like Nordstrom, Alaska Airlines and Capital One.

The company was founded in 2008 and had raised $105 million. according to Crunchbase data. It hadn’t raised any funds since 2015 when it raised a $40 million Series E led by DFJ Growth. Other investors along the way included Battery Ventures, Ignition Partners and Scale Venture Partners.

The transaction is expected to close next month pending normal regulatory approvals.


By Ron Miller

Fresh off $200M Series D, Gong acquires early stage startup Vayo

Gong announced a $200 million Series D investment just last month, and loaded with fresh cash, the company wasted no time taking advantage. Today, it announced it was buying early stage Isreali sales technology startup Vayo. The companies did not share terms of the deal, but Gong CEO Amit Bendov said the deal closed a couple of weeks ago.

The two companies match up quite well from a tech standpoint. While Gong searches unstructured data like emails and phone call transcripts and finds nuggets of data, Vaya looks at structured data, which is essentially the output of the Gong search process. What’s more, it handles large amounts of data at scale.

“Vayo helps find customer interactions at a large scale to identify trends like customers likely to churn or usage is going up, or your deals are starting to slow down — and they do this for structured data at scale,” Bendov told TechCrunch.

He said this ability to identify trends was really what attracted him to the company, even though it was still at an early stage of development. “It’s a perfect fit for Gong. We take unstructured data —  emails, audio calls video calls — and extract insights. Customers, especially with a large organization, don’t want to see individual interactions but high order insights […] and they’ve developed [a solution] to identify trends on large data volumes for customer interactions,” he said.

Vayo was founded in 2018 and raised $1.7 million in seed capital, according to Crunchbase. Joining forces with Gong gives them an opportunity to develop the technology inside a company that’s growing quickly and is extremely well capitalized having raised over $300 million in the last 18 months.

Avshi Vital, CEO at Vayo, who has joined Gong with his 4-fellow employees, gave a familiar argument for selling the company. “With Gong we found the perfect partner to realize this mission faster and maximize the impact of the technology we built given the scale of their customer base and growth potential,” he said.

The plan is to fold the Vayo tech into the Gong platform, a process that will take 3-6 months, according to Bendov.


By Ron Miller

Cisco acquiring BabbleLabs to filter out the lawn mower screeching during your video conference

We’ve all been in a video conference, especially this year, when the neighbor started mowing the lawn or kids were playing outside your window — and it can get pretty loud. Cisco, which owns the WebEx video conferencing service wants to do something about that, and late yesterday it announced it was going to acquire BabbleLabs, a startup that can help filter out background noise.

BabbleLabs has a very particular set of skills. It uses artificial intelligence to enhance the speaking voice, while filtering out those unwanted background noises that seem to occur whenever you happen to be in a meeting.

Interestingly enough, Cisco also sees this as a kind of privacy play by removing background conversation. Jeetu Patel, senior vice president and general manager in the Cisco Security and Applications Business Unit, says that this should go a long way toward improving the meeting experience for Cisco users.

“Their technology is going to provide our customers with yet another important innovation — automatically removing unwanted noise — to continue enabling exceptional Webex meeting experiences,” Patel, who was at Box for many years before joining Cisco recently, said in a statement.

In a blog post, BabbleLabs CEO and co-founder Chris Rowen wrote that conversations about being acquired by Cisco began just recently, and the deal came together pretty quickly. “We quickly reached a common view that merging BabbleLabs into the Cisco Collaboration team could accelerate our common vision dramatically,” he wrote.

BabbleLabs, which launched three years ago and raised $18 million, according to Crunchbase, had an interesting, but highly technical idea. That can sometimes be difficult to translate into a viable commercial product, but makes a highly attractive acquisition target for a company like Cisco.

Brent Leary, founder and principal analyst at CRM Essentials, says this acquisition could be seen as part of a broader industry consolidation. “We’re seeing consolidation taking place as the big web conferencing players are snapping up smaller players to round out their platforms,” he said.

He added, “WebEx may not be getting the attention that Zoom is, but it still has a significant presence in the enterprise, and this acquisition will allow them to keep improving their offering,”

The deal is expected to close in the current quarter after regulatory approval. Upon closing, BabbleLabs employees will become part of Cisco’s Collaboration Group.


By Ron Miller

Palo Alto Networks to buy digital forensics consulting firm for $265M

It’s been quite a day in the tech world with a bushel of S-1s being filed to go public. Not to be left out the ever acquisitive Palo Alto Networks announced its intent to acquire The Crypsis Group, an incident response, risk management and digital forensics consulting firm for a crisp $265 million.

Nikesh Arora, chairman and CEO at Palo Alto Networks sees a company that builds on the foundation of services the cybersecurity giant already provides, giving customers a set of services to lean on when a breach happens.

“By joining forces, we will be able to help customers not only predict and prevent cyberattacks but also mitigate the impact of any breach they may face,” he said. While the kinds of tools that Palo Alto provides are designed to prevent attacks, the fact is no set of tools is fool proof, and it’s always going to be a cat and mouse game between companies like Palo Alto and the attackers trying to breach their defenses.

Crypsis can help figure out how a breach happened and ways to close up the cracks in the foundation to prevent access through that particular weak point in the future. “We have dedicated ourselves to creating a more secure world through the fight against cybercrime. Together with Palo Alto Networks, we will be able to help businesses and governments better respond to threat actors on a global scale,” Bret Padres, CEO of The Crypsis Group said in a statement.

When the deal closes, and The Crypsis Group is in the fold, Palo Alto will gain more than 150 highly trained consultants, who have been handling approximately 1300 incidents a year. This gives Palo Alto some serious consulting fire power to deal with those times when attackers get through their defenses.

The Crypsis Group has up until now been part of a larger security consultancy called ZP Group. The deal is expected to close in the fiscal first quarter of 2021, which just started when Q42020 closed today. Per usual, the acquisition will be subject to regulatory scrutiny as Palo Alto is a public company.


By Ron Miller

Just what would an enterprise company like Microsoft or Oracle do with TikTok?

By now you’ve probably heard that under pressure from the current administration, TikTok owner ByteDance is putting the viral video service up for sale, and surprisingly a couple of big name enterprise companies are interested. These organizations are better known for the kind of tech that would bore the average TikTok user to tears. Yet, stories have persisted that Microsoft and even Oracle are sniffing around the video social network.

As TechCrunch’s Danny Crichton pointed out last week, bankers involved in the sale have a lot of motivation to leak rumors to the press to drive up the price of TikTok. That means none of this might be true, yet the rumors aren’t going away. It begs the question why would a company like Oracle or Microsoft be interested in a property like TikTok?

For starters, Oracle is a lot more than the database company it was known for in the past. These days, it has its fingers in many, many pies including marketing automation and cloud infrastructure services. In April, as the pandemic was just beginning to heat up, Zoom surprised just about everyone when it announced a partnership with Oracle’s cloud arm.

Oracle isn’t really even on the board when it comes to cloud infrastructure market share, where it is well behind rivals AWS, Microsoft, Google, Alibaba and IBM, wallowing somewhere in single digit market share. Oracle wants to be a bigger player.

Meanwhile, Microsoft has successfully transitioned to the cloud as well as any company, but still remains far behind AWS in the cloud infrastructure market. It wants to close the gap with AWS and owning TikTok could get it closer to that goal faster.

Simply put, says Holger Mueller, an analyst at Constellation Research, if Oracle combined Zoom and TikTok, it could have itself a couple of nice anchor clients. Yes, like the proverbial mall trying to attract Target and Nordstrom, apparently Oracle wants to do the same with its cloud service, and if it has to buy the tenant, so be it.

“TikTok will add plenty of load to their infrastructure service. That’s what matters to them with viral loads preferred. If Microsoft gets TikTok it could boost their usage by between 2% and 5%, while for Oracle it could be as much 10%,” he said. He says the difference is that Oracle has a much smaller user base now, so it would relatively boost its usage all the more.

As Mueller points out with the government helping push TikTok’s owner to make the sale, it’s a huge opportunity for a company like Oracle or Microsoft, and why the rumors have weight. “It’s very plausible from a cloud business perspective, and plausible from a business opportunity perspective created by the US government,” he said.

While it could make sense to attract a large user base to your systems to drive up usage and market share in that way, Brent Leary, founder and principal analyst at CRM Essentials, says that just by having a large U.S. tech company buy the video app, it could make it less attractive to the very users Microsoft or Oracle is hoping to capture.

“An old guard enterprise tech company buying Tiktok would likely lessen the appeal of current users. Younger people are already leaving Facebook because the old folks have taken it over,” Leary said. And that could mean young users, who are boosting the platform’s stats today could jump ship to whatever is the next big social phenomenon.

It’s worth pointing out that just today, the president indicated support for Oracle, according to a Wall Street Journal report. The publication also reported that Oracle’s billionaire owner Larry Ellison is a big supporter of the president, having thrown him a fundraiser for his reelection bid at his house earlier this year. Oracle CEO Safra Catz also has ties to the administration, having served on the transition team in 2016.

It’s unclear whether these companies have a genuine interest, but the general feeling is someone is going to buy the service, and whoever does could get a big boost in users simply by using some percentage of their cash hordes to get there. By the way, another company with reported interest is Twitter. Certainly putting the two social platforms together could create a mega platform to compete more directly with Facebook.

You might see other big names trying to boost cloud infrastructure usage like IBM or Google enter the fray.  Perhaps even Amazon could make an offer to cement its lead, although if the deal has to go through the federal government, that makes it less likely given the tense relationship between Amazon CEO Jeff Bezos and the president that surfaced during the Pentagon JEDI cloud contract drama.

Apple has already indicated that in spite of having the largest cash on hand of any company with over $193 billion, give or take, it apparently isn’t interested.  Apple may not be, but somebody surely is, even some companies you couldn’t imagine owning a property like this.


By Ron Miller

A pandemic and recession won’t stop Atlassian’s SaaS push

No company is completely insulated from the macroeconomic fallout of COVID-19, but we are seeing some companies fare better than others, especially those providing ways to collaborate online. Count Atlassian in that camp, as it provides a suite of tools focused on working smarter in a digital context.

At a time when many employees are working from home, Atlassian’s product approach sounds like a recipe for a smash hit. But in its latest earnings report, the company detailed slowing growth, not the acceleration we might expect. Looking ahead, it’s predicting more of the same — at least for the short term.

Part of the reason for that — beyond some small-business customers, hit by hard times, moving to its new free tier introduced last March — is the pain associated with moving customers off of older license revenue to more predictable subscription revenue. The company has shown that it is willing to sacrifice short-term growth to accelerate that transition.

We sat down with Atlassian CRO Cameron Deatsch to talk about some of the challenges his company is facing as it navigates through these crazy times. Deatsch pointed out that in spite of the turbulence, and the push to subscriptions, Atlassian is well-positioned with plenty of cash on hand and the ability to make strategic acquisitions when needed, while continuing to expand the recurring-revenue slice of its revenue pie.

The COVID-19 effect

Deatsch told us that Atlassian could not fully escape the pandemic’s impact on business, especially in April and May when many companies felt it. His company saw the biggest impact from smaller businesses, which cut back, moved to a free tier, or in some cases closed their doors. There was no getting away from the market chop that SMBs took during the early stages of COVID, and he said it had an impact on Atlassian’s new customer numbers.

Atlassian Q4FY2020 customer growth graph

Image Credits: Atlassian

Still, the company believes it will recover from the slow down in new customers, especially as it begins to convert a percentage of its new, free-tier users to paid users down the road. For this quarter it only translated into around 3000 new customers, but Deatsch didn’t seem concerned. “The customer numbers were off, but the overall financials were pretty strong coming out of [fiscal] Q4 if you looked at it. But also the number of people who are trying our products now because of the free tier is way up. We saw a step change when we launched free,” he said.


By Ron Miller

Harness makes first acquisition, snagging open source CI company Drone.io

Harness has made a name for itself creating tools like continuous delivery (CD) for software engineers to give them the kind of power that has been traditionally reserved for companies with large engineering teams like Google, Facebook and Netflix. Today, the company announced it has acquired Drone.io, an open source continuous integration (CI) company, marking the company’s first steps into open source, as well as its first acquisition.

The companies did not share the purchase price.

“Drone is a continuous integration software. It helps developers to continuously build, test and deploy their code. The project was started in 2012, and it was the first cloud native, container native continuous integration solution on the market, and we open sourced it,” company co- founder Brad Rydzewski told TechCrunch.

Drone delivers pipeline configuration information as code in a Docker container. Image: Drone.io

While Harness had previously lacked a CI tool to go with its continuous delivery tooling, founder and CEO Jyoti Bansal said this was less about filling in a hole than expanding the current platform.

“I would call it an expansion of our vision and where we were going. As you and I have talked in the past, the mission of Harness is to be a next generation software delivery platform for everyone,” he said. He added that buying Drone had a lot of upside.”It’s all of those things — the size of the open source community, the simplicity of the product — and it [made sense], for Harness and Drone to come together and bring this integrated CI/CD to the market.”

While this is Harness’ first foray into open source, Bansal says it’s just the starting point and they want to embrace open source as a company moving forward. “We are committed togetting more and more involved in open source and actually making even more parts of Harness, our original products, open source over time as well,” he said.

For Drone community members who might be concerned about the acquisition, Bansal said he was “100% committed” to continuing to support the open source Drone product. In fact, Rydzewski said he wanted to team with Harness because he felt he could do so much more with them than he could have done continuing as a stand-alone company.

“Drone was a growing community, a growing project and a growing business. It really came down to I think the timing being right and wanting to partner with a company like Harness to build the future. Drone laid a lot of the groundwork, but it’s a matter of taking it to the next level,” he said.

Bansal says that Harness intends to also offer a commercial version of Drone with some enterprise features on the Harness platform, even while continuing to support the open source side of it.

Drone was founded in 2012. The only money it raised was $28,000 when it participated in the Alchemist Accelerator in 2013, according to Crunchbase data. The deal has closed and Rydzewski has joined the Harness team,


By Ron Miller

Cisco acquires Modcam to make Meraki smart camera portfolio even smarter

As the Internet of Things proliferates, security cameras are getting smarter. Today, these devices have machine learning capability that helps the camera automatically identify what it’s looking at — for instance, an animal or a human intruder? Today, Cisco announced that it has acquired Swedish startup Modcam and is making it part of its Meraki smart camera portfolio with the goal of incorporating Modcam computer vision technology into its portfolio.

The companies did not reveal the purchase price, but Cisco tells us that the acquisition has closed.

In a blog post announcing the deal, Cisco Meraki’s Chris Stori says Modcam is going to up Meraki’s machine learning game, while giving it some key engineering talent, as well.

“In acquiring Modcam, Cisco is investing in a team of highly talented engineers who bring a wealth of expertise in machine learning, computer vision and cloud-managed cameras. Modcam has developed a solution that enables cameras to become even smarter,” he wrote.

What he means is that today, while Meraki has smart cameras that include motion detection and machine learning capabilities, this is limited to single camera operation. What Modcam brings is the added ability to gather information and apply machine learning across multiple cameras, greatly enhancing the camera’s capabilities.

“With Modcam’s technology, this micro-level information can be stitched together, enabling multiple cameras to provide a macro-level view of the real world,” Stori wrote. In practice, as an example, that could provide a more complete view of space availability for facilities management teams, an especially important scenario as businesses try to find safer ways to open during the pandemic. The other scenario Modcam was selling was giving a more complete picture of what was happening on the factory floor.

All of Modcams employees, which Cisco described only as “a small team,” have joined Cisco, and the Modcam technology will be folded into the Meraki product line, and will no longer be offered as a standalone product, a Cisco spokesperson told TechCrunch.

Modcam was founded in 2013 and has raised $7.6 million, according to Crunchbase data. Cisco acquired Meraki back in 2012 for $1.2 billion.


By Ron Miller

SAP decision to spin out Qualtrics 20 months after spending $8B surprises industry watchers

When SAP announced it was spinning out Qualtrics on Sunday, a company it bought less than two years ago for an eye-popping $8 billion, it was enough to make your head spin. At the time, then CEO Bill McDermott saw it as a way to bridge the company’s core operational with customer data, while acquiring a cloud company that could help generate recurring revenue for the ERP giant, and maybe give it a dose of innovation along the way.

But Sunday night the company announced it was spinning out the acquisition, giving its $8 billion baby independence, and essentially handing the company back to founder Ryan Smith, who will become the largest individual shareholder when this all over.

It’s not every day you see founders pull in a windfall like $8 billion, get sucked into the belly of the large corporate beast and come out the other side just 20 months later with the cash, independence and CEO as the largest individual stockholder.

While SAP will own a majority of the stock, much like Dell owns a majority of VMware, the company will operate independently and have its own board. It can acquire other firms and make decisions separately from SAP.

We spoke to a few industry analysts to find out what they think about all this, and while the reasoning behind the move involves a lot of complex pieces, it could be as simple as the deal was done under the previous CEO, and the new one was ready to move on from it.

Bold step

It’s certainly unusual for a company like SAP to spend this kind of money, and then turn around so quickly and spin it off. In fact, Brent Leary, principal analyst at CRM Essentials, says that this was a move he didn’t see coming, and it could be related to that fat purchase price. “To me it could mean that SAP didn’t see the synergies of the acquisition panning out as they had envisioned and are looking to recoup some of their investment,” Leary told TechCrunch.

Holger Mueller, an analyst with Constellation Research agreed with Leary’s assessment, but doesn’t think that means the deal failed. “SAP doesn’t lose anything in regards to their […] data and experience vision, as they still retain [controlling interest in Qualtrics] . It also opens the opportunity for Qualtrics to partner with other ERP vendors [and broaden its overall market],” he said.

Jeanne Bliss, founder and president at CustomerBLISS, a company that helps clients deliver better customer experiences sees this as a positive step forward for Qualtrics. “This spin off enables Qualtrics to focus on its core business and prove its ability to provide essential technology executives are searching for to enable speed of decision making, innovation and customization,” she said.

Show me the money

Patrick Moorhead, founder and principal analyst at Moor Insight & Strategy sees the two companies moving towards a VMware/Dell model where SAP removes the direct link between them, which could then make them more attractive to a broader range of customers than perhaps they would have been as part of the SAP family. “The big play here is all financial. With tech stocks up so high, SAP isn’t seeing the value in its stock. I am expecting a VMware kind of alignment with a strategic collaboration agreement,” he said.

Ultimately though, he says the the move reflects a cultural failure on the part of SAP. It simply couldn’t find a way to co-exist with a younger, more nimble company like Qualtrics. “I believe SAP spinning out Qualtrics is a sign that its close connection to create symbiotic value has failed. The original charter was to bring it in to modernize SAP but apparently the “not invented here” attitudes kicked in and doomed integration,” Moorhead said.

That symbiotic connection would have involved McDermott’s vision of combining operational and customer data, but Leary also suggested that since the deal happened under previous the CEO, that perhaps new CEO Christian Klein wants to start with a clean slate and this simply wasn’t his deal.

Qualtrics for the win

In the end, Qualtrics got all that money, gets to IPO after all, and returns to being an independent company selling to a larger potential customer base. All of the analysts we spoke to agreed the news is a win for Qualtrics itself.

Leary says the motivation for the original deal was to give SAP a company that could sell beyond its existing customer base. “It seems like that was the impetus for the acquisition, and the fact that SAP is spinning it off as an IPO 20 months after acquiring Qualtrics gives me the impression that things didn’t come together as expected,” he said.

Mueller also sees nothing but postivies Qualtrics. “It’s a win […] for Qualtrics, which can now deliver what they wanted [from the start], and it’s a win for customers as Qualtrics can run as fast as they want,” he said.

Regardless, the company moves on, and the Qualtrics IPO moves forward, and it’s almost as though Qualtrics gets a do-over with $8 billion in its pocket for its trouble.


By Ron Miller

Analog Devices to acquire rival chipmaker Maxim Integrated for $21 billion

Analog Devices didn’t waste any time kicking off the week with a bang when it announced this morning it was acquiring rival chipmaker Maxim Integrated Products for $20.91 billion (according to multiple reports). The company had a market cap of $17.09 billion as of Friday’s close.

The deal, which has already been approved by both company’s boards, would create a chip making behemoth worth $68 billion, according to the Analog. The idea behind the transaction is that bigger is better and the combined companies will increase Analog’s revenue by $8.2 billion.

What’s more, the two companies should combine well together in that there isn’t much overlap in their businesses. Maxim’s strength is in the automotive and datacenter spaces, while Analog is more concentrated in industrial and healthcare.

Vincent Roche, President and CEO of ADI was enthusiastic about the potential of the combined organizations. “ADI and Maxim share a passion for solving our customers’ most complex problems, and with the increased breadth and depth of our combined technology and talent, we will be able to develop more complete, cutting-edge solutions,” he said in a statement.

Maxim was founded back in 1983 and went public in 1988. It made 9 acquisitions between 2002 and 2013 with the most recent being Voltera in 2013, according to Crunchbase data.

As with all deals of this sort, it needs to pass regulator muster first, but the companies expect the deal to close by next summer.


By Ron Miller

Slack snags corporate directory startup Rimeto to up its people search game

For the second time in less than 24 hours, an enterprise company bought an early stage startup. Yesterday afternoon DocuSign acquired Liveoak, and this morning Slack announced it was buying corporate directory startup Rimeto, which should help employees find people inside the organization who match a specific set of criteria from inside Slack.

The companies did not share the purchase price.

Rimeto helps companies build directories to find employees beyond using tools like Microsoft Active Directory, homegrown tools or your corporate email program. When we covered the company’s $10 million Series A last year, we described what it brings to directories this way:

Rimeto has developed a richer directory by sitting between various corporate systems like HR, CRM and other tools that contain additional details about the employee. It of course includes a name, title, email and phone like the basic corporate system, but it goes beyond that to find areas of expertise, projects the person is working on and other details that can help you find the right person when you’re searching the directory.

In the build versus buy equation that companies balance all the time, it looks like Slack weighed the pros and cons and decided to buy instead. You could see how a tool like this would be useful to Slack as people try to build teams of employees, especially in a world where so many are working from home.

While the current Slack people search tool lets you search by name, role or team, Rimeto should give users a much more robust way of searching for employees across the company. You can search for the right person to help you with a particular problem and get much more granular with your search requirements than the current tool allows.

Image Credit: Rimeto

At the time of its funding announcement, the company, which was founded in 2016 by three former Facebook employees, told TechCrunch it had bootstrapped for the first three years before taking the $10 million investment last year. It also reported it was cash-flow positive at the time, which is pretty unusual for an early stage enterprise SaaS company.

In a company blog post announcing the deal, as is typical in these deals, the founders saw being part of a larger organization as a way to grow more quickly than they could have alone. “Joining Slack is a special opportunity to accelerate Rimeto’s mission and impact with greater reach, expanded resources, and the support of Slack’s impressive global team,” the founders wrote in the post.

The acquisition is part of a continuing trend around enterprise companies buying early stage startups to fill in holes in their product roadmaps.


By Ron Miller

DocuSign acquires Liveoak Technologies for $38M for online notarization

Even in the best of times, finding a notary can be a challenge. In the middle of a pandemic, it’s even more difficult. DocuSign announced it has acquired Liveoak Technologies today for approximately $38 million, giving the company an online notarization option.

At the same time, DocuSign announced a new product called DocuSign Notary, which should ease the notary requirement by allowing it to happen online along with the eSignature. As we get deeper into the pandemic, companies like DocuSign that allow workflows to happen completely digitally are in more demand than ever. This new product will be available for early access later in the summer.

The deal made sense given that the two companies had a partnership already. Liveoak brings together live video, collaboration tooling and identity verification that enables parties to get notarized approval as though you were sitting at the desk in front of the notary.

Typically, you might get a document that requires your signature. Without electronic signature, you would need to print it, sign the document, scan it and return it. If it requires a notary, you would need to sign it in the notary’s presence, which requires an in-person visit. All of this can be streamlined with an online workflow, which DocuSign is providing with this acquisition.

It’s like the perfect pandemic acquisition, making a manual process digital and saving people from having to make face-to-face transactions at a time when it can be dangerous.

Liveoak Technologies was founded in 2014 and is part of the Austin, Texas startup scene. The company raised just under $28 million during its life as a private company. The firm most recently raised $8 million at a post-money valuation of $30.4 million, according to Pitchbook data. Given the amount that DocuSign paid for the startup, it appears to have gotten a bargain.

This acquisition is part of a growing pandemic acquisition trend of sorts where larger public enterprise companies are plucking early stage startups, in some cases for relatively bargain prices. Among the recent acquisitions are Apple buying Fleetsmith and ServiceNow acquiring Sweagle last month.


By Ron Miller

Unpacking how Dell’s debt load and VMware stake could come together

Last week, we discussed the possibility that Dell could be exploring a sale of VMware as a way to deal with its hefty debt load, a weight that continues to linger since its $67 billion acquisition of EMC in 2016. VMware was the most valuable asset in the EMC family of companies, and it remains central to Dell’s hybrid cloud strategy today.

As CNBC pointed out last week, VMware is a far more valuable company than Dell itself, with a market cap of almost $62 billion. Dell, on the other hand, has a market cap of around $39 billion.

How is Dell, which owns 81% of VMware, worth less than the company it controls? We believe it’s related to that debt, and if we’re right, Dell could unlock lots of its own value by reducing its indebtedness. In that light, the sale, partial or otherwise, of VMware starts to look like a no-brainer from a financial perspective.

At the end of its most recent quarter, Dell had $8.4 billion in short-term debt and long-term debts totaling $48.4 billion. That’s a lot, but Dell has the ability to pay down a significant portion of that by leveraging the value locked inside its stake in VMware.

Yes, but …

Nothing is ever as simple as it seems. As Holger Mueller from Constellation Research pointed out in our article last week, VMware is the one piece of the Dell family that is really continuing to innovate. Meanwhile, Dell and EMC are stuck in hardware hell at a time when companies are moving faster than ever expected to the cloud due to the pandemic.

Dell is essentially being handicapped by a core business that involves selling computers, storage and the like to in-house data centers. While it’s also looking to modernize that approach by trying to be the hybrid link between on-premise and the cloud, the economy is also working against it. The pandemic has made the difficult prospect of large enterprise selling even more challenging without large conferences, golf outings and business lunches to grease the skids of commerce.


By Ron Miller

Fleetsmith customers unhappy with loss of third-party app support after Apple acquisition

When Apple confirmed it had acquired Fleetsmith, a mobile device management vendor, on Wednesday, it seemed like a straightforward purchase, but Fleetsmith customers quickly learned a key piece of functionality had stopped working  — and many weren’t happy about it.

Apple systems administrators began complaining on social media on the morning of the acquisition announcement that the company was no longer allowing them to connect to third-party applications.

“Primarily Fleetsmith maintained a third party app catalog, so you could deploy things like Chrome or Zoom to your Macs, and Fleetsmith would maintain security updates for those apps. This was the main reason we purchased Fleetsmith,” a Fleetsmith customer told TechCrunch.

The customer added that the company described this functionality as a major feature in a company blog post:

Fleetsmith handles this all for you automatically. Once the version is enforced, it is downloaded and queued for install immediately across the device fleet. Most apps will update silently and automatically once they’re restarted, but users can also choose to do the update manually. Our agent will remind users about the update periodically, and then once the enforcement date hits, it will give them an opportunity to save work and then run the update itself.

As it turned out, Apple had made it clear that it was discontinuing this feature in an email to Fleetsmith customers on the day of the transition. The email included links to several help articles that were supposed to assist admins with the transition. (The email is included in full at the end of the article).

The general consensus among admins that I spoke to was that these articles were not terribly helpful. While they described a way to fix the issues, they said that Apple has turned what was a highly automated experience into a highly manual one, effectively eliminating the speed and ease of use advantage of having then update feature in the first place.

Apple did confirm that it had responded to some help ticket requests after the changes this week, saying that it would soon restore some configurations for Catalog apps, and were working with impacted customers as needed. The company did not make clear, however, why they removed this functionality in the first place.

Fleetsmith offered a couple of key features that appealed to Mac system administrators. For starters, it let them set up new Macs automatically out of the box. This allows them to ship a new Mac or other Apple device, and as soon as the employee powers it up and connects to WiFi, it connects to Fleetsmith where systems administrators can track usage and updates. In addition, it allowed System Administrators to enforce Apple security and OS updates on company devices.

What’s more, it could also do the same thing with third-party applications like Google Chrome, Zoom or many others. When these companies pushed a new update, system administrators could make sure all users had the most recent version running on their machines. This is the key functionality that was removed this week.

It’s not clear why Apple chose to strip out these features outlined in the email to customers, but it seems likely that most of this functionality  isn’t coming back, other than restoring some configurations for Catalog apps.

Email that went out to Fleetsmith customers the day of the acquisition outlining the changes:

 

Attempts to reach Fleetsmith founders for comment were unsuccessful. Should that change we will update the article.


By Ron Miller