The acquisition space has been vibrant at the beginning of 2014, as more companies are looking to bolster their options in terms of mobile delivery and features, greater messaging and media options, and everyone is looking for new innovative products. 2014 seems a good time to sell a tech business, and business transfer agents are surely in a position of strength. However, as we say at Acuity, building a business is not just about market trends but about passion, sacrifice and personal stories.
Russian expansion (not into Crimea!)
Russian search engine giant Yandex has looked to bolster its “maps” and navigational tools expertise by acquiring Israeli geolocation firm KitLocate for “several million euros”. The move is expected to add greater technical know-how to the search engine’s mobile offering, though the company’s Yandex Navigator mobile app is already one of the most utilised in Russia. Strong relations between the vibrant tech scene in Israel and the capital-wealthy Moscow-based firms continues to pay dividends. Founded in 2011, KitLocate offers an energy-saving software developer kit for iOS and Android developers to help make apps location-aware while consuming less battery.
Another Russian behemoth, Mail.ru, increased its stake in Russian social networking site VKontakte to around 52.0% by securing a 12.0% stake from mobile operator Megafon’s CEO Ivan Tavrin. Mail.ru appears fairly determined to purchase all major cleantech and digital media operations on the Russian market, providing opportunities for firms able to appeal to the rather unique “Russiasphere”.
Chat and music streaming in demand
In other notable purchases, digital music platform Rdio bought Indian music start-up Dhingana, which many are noting as a sign the San Francisco-based company already present in 35 markets is considering a move into the massive Indian marketplace. Dhingana would certainly be glad to have made its exit so successfully, since the service was shut down last month. Finances have not been disclosed although the price seems a fairly acceptable $7.0 million according to most sources. Emerging market start-ups are gradually being snapped up by Western corporate financiers who see market potential locally, and are looking for the contacts, expertise and the HR on the ground.
Meanwhile, the infamous file transfer firm Dropbox purchased workplace chat system Zulip, again for an undisclosed amount. The move underlines the desire of Dropbox to expand its range of services beyond its core operations, and the company is likely to acquire several other start-ups this year in a bid to diversify.
The most impressive sale of the week goes to analytics firm Renaissance Learning, who was bought by private equity firm Hellman & Friedman for around $1.1 billion. Renaissance Learning has a presence in around a third of US schools, and primarily analyses student data. The purchase is probably based on the assumption of more state contracts in the future, which would make the service highly prized.