Appature’s new offices along Westlake Avenue boast stunning views of Lake Union and a playful atmosphere, including Nerf guns everywhere, bean bag chairs and a well-stocked Kegerator.
None of those things will be going away. But something else will: the name on the lease.
We’re hearing that the deal’s value topped $100 million, a significant valuation for the 60-person startup. Co-founder Kabir Shahani declined to comment on the terms of the deal, though he said it was a “great outcome for investors and employees.”
“We go from being a small startup in Seattle trying to make an impression in the market, which we have been to our credit — and all of a sudden we become this global company in 100 countries, with vast resources to bring our vision to life even faster,” said Shahani. “Our five-year vision for things will happen over the next two or three.”
The acquisition comes eight months after Appature reeled in $6.1 million in venture funding from Madrona Venture Group and Ignition Partners, marking a nice return for both Seattle-based venture capital firms. Total funding in Appature, which was bootstrapped and profitable for its first three years, stood at $9.6 million.
Ignition’s Richard Fade, a board member at Appature, called it a positive deal for investors.
“On the whole we would have liked to have been able to develop the company for another couple years prior to M&A but the IMS offer was compelling,” said Fade, adding that the company is an example of the type of cloud computing talent developing in Seattle.
Madrona’s Tim Porter also celebrated the outcome, and pointed to the strong entrepreneurial drive of founders Chris Hahn and Shahani.
“They were growing quickly and had a bright future as a standalone company, but when IMS approached the company it was clearly a singular opportunity to scale even more efficiently and we are happy that IMS is also excited about the future of this Seattle technology company,” Porter said.
Shahani called IMS Health the “gold standard in health care,” noting it was the original big data company since it was founded in the 1950s.
“These guys process more data than the IRS,” said Shahani, who turned 30 last October. If all goes as planned, Shahani said that IMS has the opportunity to create a powerful new Web-based service that combines data and software. “To be really interesting, and really valuable, you have to be a data company and a software company,” he said.
IMS will bring the data, while Appature plans to bring its software expertise.
IMS Health will immediately inject more horsepower into Appature, helping the company grow its client base and international presence. As part of that, Shahani said that they will immediately open new jobs for about 20 staffers, with plans to grow the team to as many as 100 people this year. Appature will continue to operate as a standalone business under the umbrella of IMS.
“Through this acquisition, we’ll drive the development of next-generation, data-driven marketing effectiveness solutions, transforming the way clients plan and execute their programs. Appature also brings a strong culture of innovation to IMS, reinforcing our commitment to agility and the development of breakthrough solutions,” said IMS U.S. president Seyed Mortazavi in a statement.
IMS was purchased by the private equity firm TPG, CPP and others in 2009 for $5.2 billion.
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