TBP Spotlight – Magnitude Acquires Innowera

Magnitude Software
Innowera

Magnitude Software Acquires Innowera

Sunil Grover, Managing Partner
sgrover@truebluepartners.com
(669) 231-8770

Deal Financials

Undisclosed

Transaction Overview

  • On Dec 20, 2017 Audax-backed Magnitude Software, a provider of data analytics software, announced its acquisition of Innowera, a SAP data management solutions provider.
  • Magnitude is consolidating the space for data analytics through a bold and focused M&A strategy outlined here. Magnitude has now acquired four data management software providers in the past two years as outlined below.
  • For Innowera founder, Mickey Shah, this is the second time he has exited an SAP data management software company. Earlier in his career, in the early 2000s, he exited Winshuttle, a software company that enables customers to streamline data transfer between Excel and SAP.

PE-Driven Value Creation in Enterprise Software – A Case Study

  • The roots of Magnitude date back to the formation of Noetix Corporation in 1994, which was acquired by ARIS in 1996 only to be spun off in 2000. After raising $20m in funding from Polaris Partners and Sigma Partners, Noetix acquired Jaros Technologies in 2009 for its Oracle EBS analytics product. Subsequently, Silverback Enterprise Group acquired Noetix and Kalido to form Magnitude Software in 2014. This transaction history is summarized below.

Key Takeaways for Enterprise Software Entrepreneurs

  • The window of opportunity to create organic value for on-premise software solutions is rapidly closing. The path for value creation and capture is either through migrating the business model and technology infrastructure to SaaS, a journey fraught with risk, or through executing bold and transformational acquisitions.
  • For companies that provide differentiated and niche offerings in established and large ecosystems like SAP, Oracle, and Microsoft, attractive exit opportunities still exist.
  • There are new ecosystems maturing around cloud leaders like Salesforce and ServiceNow that will create the next generation of mid-market enterprise software companies, some of which are covered in a recent True Blue Partners report available here.

The Transactions that Created Magnitude Software

About True Blue Partners, LLC
True Blue Partners is a boutique M&A advisory firm that serves lower mid-market enterprise software, service and solutions companies. It brings the rigorous strategic and financial perspective of bulge bracket firms with a company building approach and a steadfast partnership that only an independent boutique firm can deliver. For more information please visit www.truebluepartners.com or email us at info@truebluepartners.com