We love the Talent Management and Human Capital
Management space. It is a vibrant, thriving part of our
economy and there is never a dull moment.
While there will no doubt be countless of blogs and stories about this acquisition, we wanted to be one of the first to give our unique viewpoint. As an HR technology consulting firm that prides itself on our knowledge of Talent Management and HCM vendors, it is our job to keep up-to-date on happenings in our industry and pass that knowledge on to you.
For starters, this is no surprise to us. We have felt that Authoria was an acquisition or merger target for quite some time now and felt in the past few months that something was about to happen. They are a well run company with great people, great technology and a great customer base. As an implementation partner of Authoria’s, we have had a great relationship with them for years and look forward to that continuing.
Before we talk about the acquisition itself, think about this. The market for Talent Management Suites, of which Authoria is one of, is estimated to be around $2.5b currently and is looking at a 25-30% growth rate…and we feel the market is still largely untapped!
So let’s talk about the acquisition.
For starters, Bedford Funding is a private equity firm out of New York with a roughly $800m fund. It is possible they will be looking at other acquisitions in the dynamic Talent Management space and it is also very possible that other private equity firms will be looking to stake claims in this space.
The acquisition took place for $63m, which in my opinion, at least on the surface, is a steal for Bedford Funding. Given that Taleo acquired Vurv for $128m and we believe the companies were similar in size, it certainly does raise some questions.
Authoria has been relative quiet as of late, although they did recently issue a press release talking about over 90% growth. HRchitect is the leading Talent Management Systems evaluation and selection consulting firm and we haven’t seen them showing up in as many deals over the past few months. I expect that to now change with this announcement.
This acquisition will also put $8m into Authoria immediately to help the company grow. Authoria also received $22m about a year ago. With this kind of money, and the potential for deep-pocketed Bedford Funding to put more into Authoria, this is good for our industry all the way around. Given that this is Bedford Funding’s first foray into this space, they would be best to let Authoria management run itself for the time being.
Also, it is important to note that this appears to be more of a “funding” venture for Authoria than an acquisition. At least for now. Acquisition can many times be a dirty word for those involved but funding is usually a good word!
What does this mean for customers? For existing customers, this is certainly good news as additional investment into the product will be made. For prospective customers, this should also spell good news but as with any Talent Management or HCM purchase, please don’t go it alone. Hire a firm like HRchitect which will take you through a series of Decision Drivers, including vendor viability, to help ensure you have a long-term and productive relationship with a vendor, while virtually eliminating the risk that typically exists in these projects from the start. Join HRchitect for it’s webinar discussion Decision Drivers on October 8 or November 11. Click here for more information and to register.
Watch this blog for more on the acquisition, and other happenings in the Talent Management and HCM space, as it happens. Tune in today, September 30, at 1 PM Central time for HRchitect’s Suite Life of Integrated Talent Management webinar for in-depth information regarding the Talent Managment market. Click here to register for the webinar.
Solving a piece of the puzzle…
Matt Lafata, HRchitect