Dear Clients and Friends,
The following report covers m&a trends, values and deals in the four segments of the Enterprise Data and Analytics sector that we follow and sometimes lead.
We often talk about game-changing tools that confer a competitive advantage. Sometimes we use the term “weapon”. In the case of Big Data, the latter terminology may well be most apt.
Not all weapons change the game; but some do. In the late 15th century, it was guns. Suddenly, those fighting with knives, swords, shields or even bows and arrows were decimated. In 1895, it was machine guns – capable of wiping out dozens of those with less effective weapons. In 1916, it was tanks – rolling bunkers that protected the men inside from mere bullets, while destroying those outside. Then came Chlorine Gas, with its ability to cause death on a scale never before imagined. The German Fokker brought warfare to the sky. And then came the Atom bomb – a single one of which in 1945 killed more than 200,000 people – in about a minute. And now we have Big Data.
As widely reported, one key to Donald Trump’s victory was a $400 million big data operation with 1,500 people in all 50 US states. From a nerve center in Texas, connected to another operated by the Republican National Committee, and linked to an analytics company, Trump’s operation collected massive amounts of data on voters in each precinct and developed correlations that allowed them to discern – with high accuracy – traits such as intelligence, education, skin color, religion, alcohol, cigarette and drug use, gun ownership, dog ownership, sexual orientation, household income, party and other organization affiliations, and more. With that information they determined where to spend time and money and tailored messages for each precinct and each medium (Rallies, radio, TV, online, etc.); Marshall Mcluhan once said that “The medium is the message”. But in this case, the analytics drove the content of those messages. It worked; it’s scary; and the world is forever changed.
We advise companies in the data and analytics space on m&a and for some it has become a heady time. Mankind does not have strong track record in controlling game changing weapons. We can only hope that these are used responsibly.
As you will see, from our report below, values and volume in all four sectors are quite strong. Some of the more interesting deals this past month include:
- Red Ventures (Fort Mill, SC) agreed to acquire Bankrate (NYSE:RATE) for $1.3bn, implying an enterprise value of $1.4bn and valuing the company at an implied 3.1x LTM revenue and 15x LTM EBITDA,
- WalkMe (San Francisco, CA) raised $75mm in a Series E funding round led by Insight Venture Partners,
- SimilarGroup (Tel Aviv, Israel) raised $47mm in an equity funding round led by Viola Growth,
- Alation (Redwood City, CA) raised $23mm in a Series B funding round led by Icon Ventures,
- Morningstar (NASDAQ:MORN) acquired a 40% stake in Sustainalytics for an undisclosed sum,
- Vista Equity Partners (Austin, TX) acquired Xactly for an undisclosed sum.
Please find our August Enterprise Data and Analytics Update below.