July SMB Software News Recap

Each month we report on news and updates for the companies in the SurePath SMB Index — a basket of publicly traded software and technology companies that serve the SMB market. Here is what made the news this month:

Acquisitions/Divestments/Investments:

• Mitel is slated to acquire Shoretel for $430M at $7.50 a share, a 28% premium over its last unaffected closing stock price. Ironically, Mitel has made an offer on Shoretel several years ago at $8.10 a share, which was rejected for “severely undervaluing the company”.
• GoDaddy divested PlusServer, a managed hosting service that came prepackaged with GoDaddy’s acquisition of HEG. PlusServer was sold to BC Partners for a total of $456M USD, that accounts for 25% of the HEG purchase price.
• Hubspot acquired Kemvi, an AI analytics software startup that just closed its seed round in May this year. The price was not disclosed, but Hubspot aims to use Kemvi’s capabilities to help salespeople with AI-enabled research.
• Sage acquired Intacct Corporation for $850M USD. Intacct is a cloud based provider of Financial Management Solutions and gives Sage a strong offering and position for their mid market and larger customers.
• Qualys acquired Nevis Network’s assets in order to build a greater knowledge base around passive scanning technologies. The terms of the deal was not disclosed.

New Product Launches This Month:

• Vistaprint launched a monthly subscription box for businesses called Promobox —it contains 3 to 5 customized products specifically designed for the business. Who doesn’t like a surprise present, even at work?
• We keep talking about how GoDaddy has been making waves in trying to acquire more share of the Wordpress websites management. Earlier this month GoDaddy launched a 24/7 support team for Wordpress websites
• Wix launched Wix Code, a database programming solution for non-coders and developers alike that will allow them to build web apps. The new additions are optional, and grant greater functionality to Wix websites. The company has been on a tear lately with revenue accelerating 51% YoY.

Other News:

• Grubhub and Groupon partners to provide Groupon customers food ordering and delivery. The allows Groupon to access 55,000 restaurants, while Grubhub gains access to Groupon’s 31.6 million customers. It will be interesting to see if this partnership has any impact on Yelp.
• Shopify hits another major milestone, surpassing 500K merchants on the platform and growing revenues 75% YoY. The company’s gross profits also grew 83% vs same quarter last year. 🇨🇦🍁
• The CFO of Atlassian quit earlier this month. Murray Demo has been with the Australian tech company for 6 years, and was instrumental in their successful IPO on the NASDAQ.
• TELUS and Ring Central announced a partnership to launch Telus Business Connect Mobile, which will allow Canadian SMBs to access a full suite of unified communications solutions.
• Lendingtree recorded revenues of $153M in 2Q 2017, up 62% YoY.

BONUS

• Paypal invested into Cloud.IQ’s Series A round. The UK startup provides an automated eCommerce conversion platform designed to optimize customer conversion rate. The investment is part of the continuing trend of Paypal’s interest in adding more AI enabled solutions for its customers
• Speaking of payment companies using machine learning — Square is purportedly using predictive analytics to sell existing customers more products.

At SurePath Capital Partners we help startups raise the capital needed to become market leaders. When the time is right, we help our clients achieve profitable, deliberate exit strategies. We only work with startups in the SaaS, e-commerce and marketplace segments. Across those segments we have a deep focus on companies serving the global SMB market. Say hello:info@surepathcapital.com