IFS has announced the acquisition of WorkWave LLC. Workwave delivers SaaS (Software as a Service) solutions for field service, last mile delivery and logistics industries. It focuses on the SMB sector with specific micro vertical focus on Pest Control, Lawn & Landscape, Cleaning & Janitorial, Heating/Ventilation/AC, Plumbing & Electrical and Transportation.
This is the second acquisition in North America since EQT took IFS private. The first was MXI technologies. That saw a new business division created by IFS to service the A&D MRO market. According to a blog by Chris Sullens, CEO, WorkWave they will become a new business unit within IFS. Sullens commented: “As a standalone division of IFS, we will have access to the financial resources, global footprint, and scale of a larger organization to strengthen our capabilities, while retaining the solutions and entrepreneurial team that serve our target markets.“
What isn’t clear is whether elements of IFS will become part of this new business unit. That is what happened after IFS created the A&D business. This is also the third acquisition that IFS has done in this sector. It follows on from mplsystems Limited (MPL) and Field Service Management Limited (FSM), both in the UK.
Buying into Success
Like the MXI Technologies acquisition IFS is buying a successful company. It will not have come cheap. Estimated revenues for 2016 are $36.5 million at Workwave with a growth rate over 3 years of more than 100% (Source Inc.com). It climbed more than 800 places in the Inc 5,000 over 2016. With such a solid growth path why did Sullens and Workwave agree the sale? It is likely that they saw significant benefits in being part of a larger global organisation. One of those will have been the ability to expand internationally a lot faster. IFS already has relationships with some of the micro verticals that Workwave deals in. It recently completed a trial of its IoT technology in Finland with AntiCimex.
Workwave has 260 employees and more than 7,300 customers, most of whom are in the US. IFS will want to expand its footprint into these customers with other solutions such as the full ERP suite. The question is how quickly they can integrate the solutions? In addition, will those companies actually need to buy a new ERP. If they already have a cloud-based field service management solution they may also have a cloud-based finance system. Despite this, IFS gets access to a sales team with relationships across the industry. More importantly, it is a sales team that can help expand the IFS footprint in the US.
Fredrik vom Hofe, Group Senior Vice President for Business Development at IFS commented: “This acquisition is further evidence of how IFS is investing to extend its global leadership in Service Management. WorkWave, with its very strong SaaS offering and deep knowledge of how to serve SMB service businesses, complements the already leading service management offering from IFS that is used by many larger service-centric companies. We can now offer the most complete, connected Service Management solutions across the full-spectrum of service organisations and service-intensive industries, globally. In addition, we have significantly strengthened our presence in North America, the world’s largest software market, meaning that the Americas is now the largest region in the IFS Group.”
What does this mean
IFS now has a second substantive presence in the US through this acquisition. IFS will hold their main convention in Atlanta next year. Customers from MXI Technologies and Workwave should boost the numbers and make this its largest ever. This despite being held outside its home region.
Workwave and its brands, including PestPac and Service CEO, should benefit from the global reach of IFS and some its its new technology. IFS LABs are investing in drones, blockchain as well as IoT and that research will benefit Workwave’s customers. Chris Sullens, CEO of WorkWave, commented: “We now have the opportunity to leverage the resources of a leading service management software organisation, while continuing to invest in and deliver exceptional products and services to our core clients in pest control and other field service verticals. Our combination of offerings will help service businesses of all sizes solve their operational and growth challenges through our market-leading software solutions.”
The acquisition is expected to close in Q4 2017. It will be interesting to see how the company will restructure following these acquisitions.