Private equity has become a big player in the startup market. Here are the 10 biggest startup acquisitions PE firms have made in the last 3 years. (CHWY)

BI Prime

Chewy CEO Sumit Singh is seen outside the New York Stock Exchange (NYSE) ahead of the Chewy Inc. IPO in New York City, U.S., June 14, 2019.Chewy CEO Sumit Singh is seen outside the New York Stock Exchange (NYSE) ahead of the Chewy Inc. IPO in New York City, U.S., June 14, 2019.

Sumit Singh was installed as Chewy’s CEO after its acquisition by PetSmart in a private equity-backed deal. Last year, he led the online pet supply retailer through its initial public offering.

Andrew Kelly/Reuters


This story is available exclusively on Business Insider Prime.
Join BI Prime and start reading now.

  • Private equity firms have become major players in the startup market.
  • Last year, 20% of all startups that had a successful exit — meaning they either went public or were acquired — were bought in a private equity-related deal.
  • Startups still see lots more money from IPOs and corporate acquisitions than from private equity deals, but PE firms are spending increasing amounts.
  • The top 10 biggest private equity purchases of startups are listed below.
  • Click here for more BI Prime stories.

The vast majority of startups don’t go public. They get acquired — assuming they don’t go out of business first.

Traditionally, the acquirers of venture-backed startups have been other, independent companies in the same industry, whether they are established players or other startups. But more and more startups these days are being acquired by private equity firms.

Last year, about 20% of all startups that had a successful exit — meaning they were either acquired or went public — were purchased either directly by a private equity firm or by a company that was owned by one, according to PitchBook. That was up from just 5% in 2003.

Startup backers still see lots more money from the public markets and corporate buyers than they do from private equity firms. But the amounts that PE firms are spending on startups is steadily increasing and in some cases has gotten quite large.

Last year, such firms spent $6.3 billion buying up startups — up from $690 million seven years earlier. And three private equity buyouts over the three years topped $1 billion.

Here, according to PitchBook, are the 10 largest private equity purchases of startups over the last three years:

10. Stonepeak Infrastructure Partners — Cologix, $500 million

Cologix CEO Bill Fathers

Stonepeak Infrastructure Partners named Bill Fathers, one of its senior operating partners, as Cologix’s CEO after it acquired the startup.

Cologix


Startup: Cologix

Headquarters: Denver

Industry: IT Services — Data center provider

Number of venture rounds: 3

Venture equity capital raised: $43.9 million

Pre-acquisition debt raised: $375 million

Acquirer: Stonepeak Infrastructure Partners

Closing Date: March 21, 2017

Amount: $500 million

Sources: PitchBook, Cologix

9. Lithium Technologies (owned by Vista Equity partners) — Spredfast, $540 million

Khoros CEO Jack Blaha

Khoros named Jack Blaha as its CEO after it was formed from the merger of Lithium Technologies and Spredfast.

Khoros


Startup: Spredfast

Headquarters: San Francisco

Industry: Digital marketing, customer relationship management

Number of venture rounds: 7

Venture equity capital raised: $140.3 million

Acquirer: Lithium Technologies

Private-equity backer: Vista Equity Partners

Name of successor startup: Khoros

Closing Date: October 2, 2018

Amount: $540 million

Sources: PitchBook, Khoros

8. Blackstone — Vungle, $750 million

Team Vungle attends Founder Institute's Tech Carnival 2013 at Candlestick Park on July 17, 2013 in San Francisco, California.

Founded in 2011, Vungle was acquired by Blackstone last fall.

Trisha Leeper/Getty Images


Startup: Vungle

Headquarters: San Francisco

Industry: Mobile advertising

Number of venture rounds: 3

Venture equity capital raised: $27.4 million

Acquirer: Blackstone

Closing Date: September 30, 2019

Amount: $750 million

Sources: PitchBook, Vungle

7. Navicure (owned by Bain Capital) — ZirMed, $750 million

Waystar CEO Matt Hawkins

After announcing it would merger Navicure with ZirMed, Bain Capital brought in Matt Hawkins to run the combined company as its CEO.

Waystar


Startup: ZirMed

Headquarters: Louisville, Kentucky

Industry: Healthcare billing software

Number of venture rounds: 2

Venture equity capital raised: Not disclosed

Acquirer: Navicure

Private-equity backer: Bain Capital

Name of successor startup: Waystar

Closing Date: November 1, 2017

Amount: $750 million

Sources: PitchBook, Waystar

6. Insight Partners — Recorded Future, $780 million

Recorded Future CEO and Co-Founder Christopher Ahlberg

Recorded Future CEO and Co-Founder Christopher Ahlberg

Recorded Future


Startup: Recorded Future

Headquarters: Somerville, Mass.

Industry: Cybersecurity

Number of venture rounds: 5

Venture equity capital raised: $59 million

Acquirer: Insight Partners

Closing Date: May 30, 2019

Amount: $780 million

Sources: PitchBook, Recorded Future

5. Vista Equity Partners— Wrike, $800 million

Wrike CEO Andrew Filev

Wrike founder Andrew Filev has continued to serve as the startup’s CEO even after its acquisition by Vista Equity Partners.

Wrike


Startup: Wrike

Headquarters: San Jose, Calif.

Industry: Project management software

Number of venture rounds: 4

Venture equity capital raised: $36.6 million

Pre-acquisition debt raised: $10 million

Acquirer: Vista Equity Partners

Closing Date: November 29, 2018

Amount: $800 million

Sources: PitchBook, Wrike

3. Vista Equity Partners — Acquia, $1 billion

Mike Sullivan Acquia CEO

Mike Sullivan led Acquia through its acquisition by Vista Equity Partners and has remained its CEO since.

Acquia


Startup: Acquia

Headquarters: Boston

Industry: Content management software and hosting service

Number of venture rounds: 10

Venture equity capital raised: $194 million

Acquirer: Vista Equity Partners

Closing Date: November 1, 2019

Amount: $1 billion

Sources: PitchBook, Acquia

2. Thoma Bravo — ConnectWise, $1.5 billion

ConnectWise CEO Jason Magee

ConnectWise named Jason Magee, formerly its chief operating officer, as its new CEO following its acquisition by Thoma Bravo.

ConnectWise


Startup: ConnectWise

Headquarters: Tampa, Fla.

Industry: IT services

Number of venture rounds: 0 (Bootstrapped)

Acquirer: Thoma Bravo

Closing Date: February 28, 2019

Amount: $1.5 billion

Sources: PitchBook, ConnectWise

More:

BI Prime
Private Equity
Venture Capital
Startups

Chevron iconIt indicates an expandable section or menu, or sometimes previous / next navigation options.

Read More

(Visited 1 times, 1 visits today)
Join Our Newsletter.
We'll send you the best news and informed analysis on what matters the most to you.

Leave a Reply

Your email address will not be published. Required fields are marked *

Scroll Up Scroll Up
en_USEnglish
en_USEnglish