'We weren't motivated to sell' says Avecto
Like any good relationship it's impossible to force an acquisition, says recently acquired cyber security specialists Avecto.
The Manchester-based company announced yesterday it had been purchased by American technology group Bomgar, a leader in identity and access management solutions for privileged users.
The deal, which is expected to close at the end of this month, will coincide with the company's ten-year anniversary. It also announced record revenues of £23.5 million in August, representing growth of 51 per cent on the previous year.
Following nine years of consecutive growth, co-founder Mark Austin said the deal felt like the right thing to do despite not having particular plans to sell the company.
"It’s been a good run," he told BusinessCloud following the announcement.
"It's always been about running a good business, about innovating and growing each year. That meant it was less about us being motivated to sell and more about the fact we were approached by Bomgar and we both had tech in the same space.
"We were clear leaders in our sub-category and Bomgar have other elements of the sector, so the combination of the two means a portfolio of products that will allow the combined company to be a true leader in the broader space."
Austin says the deal makes sense for both companies, which have similar cultures focused on employees, customers and partners.
"You can’t force these things and the timing just felt right," he said. "Markets tend to consolidate anyway so it was good time for the two companies to come together.
"Now we need to plan how to integrate them to maximise the opportunity."
This will be no mean feat. Avecto boasts over 1,000 customers while Bomgar, which has been running since 2003, has 15,000.
Avecto's Defendpoint software is used by some of the world's biggest companies to protect against ‘privileged access’ attacks while improving compliance, productivity and performance.
"We just want to make sure we’re set up right with the right messaging," said Austin.
"It will take several months to integrate, and Paul [Kenyon, Austin’s co-founder] and I will be focused on working with their executive team to ensure it goes smoothly. Don’t try and change things too quickly."
Austin says the move won’t mean an increased focus on the US as much as using the global reach of the two companies to strengthen both networks.
Both companies are international, with Avecto’s existing offices based in the UK, United States and Germany.
"Bomgar are a US-headquartered company and we have the European strength, which is really important, so when you suddenly get a combination that has both a strong US and European presence both do well across the world," he said.
"The products Avecto develop are in the Manchester office, so all our offices are important for future strategy."
As the business celebrates its tenth year this summer, Austin says the entire team is feeling positive about the deal.
"It's an even bigger celebration now with everyone looking forward to how far the combined company can go," he said.
"We can absolutely be a leader within this privileged access management space.
"We weren’t positioned to be a leader in the broader space as we would have had to develop different tech. Likewise, Bomgar has strong tech in certain areas, so the two together means the broad portfolio is extremely strong.
"The key now is to get the integration right over the coming months."
Looking back over the last 10 years Austin says the key to success was hiring the right people.
"You have to have the right staff to get that sort of growth," he said.
"We’ve had consecutive growth averaging around 40 per cent each year, with 50 per cent last year, because we employed some really good people and they’ve worked to keep the culture feeling like a start-up over 10 years, which can be difficult."
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