Bullhorn has announced that it will soon have new investors. Insight Venture Partners will acquire the shares owned by Vista Equity Partners. The announcement does not come as a total surprise. It was known last month that Vista Equity Partners were looking to sell the cloud computing company after five years of ownership.
It may seem odd that Vista Equity Partners are selling at a time when Bullhorn is expanding successfully. They recently acquired Connexys, who have a Salesforce platform based ATS solution. That acquisition helped boost its European expansion. However, the five year term is up and despite the opportunity Vista felt it time to sell. Vista acquired Bullhorn in 2012 in a deal around “the lower end of hundreds of millions of dollars” according to Techcrunch at the time.
While Insight is purchasing the existing shares there is also an inference of further investment as well. Deven Parekh, Managing Director, Insight Venture Partners commented: “Bullhorn is the software leader in the staffing and recruiting sector. As the workforce continues to evolve, we believe that continued strong investment in next-generation technology will extend Bullhorn’s market leadership position.”
No financial details were disclosed. This makes it hard to tell what level, if any, investment Insight Ventures Partners are bringing to Bullhorn.
Business as usual
Importantly, there is no disruption to the running of Bullhorn. The entire management team is staying in place. Art Papas, Bullhorn CEO and Founder said: “We are excited to work with Insight to amplify our tremendous momentum with another great financial sponsor as we continue to grow this business, and I am personally more committed than ever to our customers and to our people. Vista’s investment and expertise helped us build out the platform and people that have enabled us to rapidly scale, and we’re looking forward to partnering with Insight on our next phase of growth.”
There will no doubt be changes to the Bullhorn board with Insight members joining and Vista leaving. It will be interesting to see if the pace of change at Bullhorn accelerates with new investment. Bullhorn believes that staffing and recruiting are transforming and it has the software to help organisations meet that challenge. It sees four trends in the industry that are driving change:
- Globalization : Companies are working across boundaries. The question is whether these are not only international but also corporate boundaries.
- Legacy system replacement : Cloud solutions are prevailing in an industry that has long been computerised. The tipping point for cloud was passed and the advantage of mobile ready cloud solutions delivers competitive advantage
- Newer workforce management models: With new models such as the gig economy emerging solutions need to match both the immediate requirements but also the evolving landscape of the working ecosystem.
- Increasing competition: The cost of entry into the market has never been lower. The question is whether this will change in time. Certainly companies need efficiency and extended networks to be successful.
What does this mean.
Vista can look back on a job well done. Alan Cline, Principal and Co-Head of the Foundation Fund at Vista commented: “We are thrilled to announce the sale of Bullhorn to Insight. It has been a pleasure working with Art and the Bullhorn team over the past five years to help quadruple the company’s revenues, accelerate platform investment, and expand internationally to best serve the software needs of staffing and recruiting firms globally.” Cline falls short of indicating how much their investment realised over the last five years but it seems likely to have been substantial. The deal is expected to close before the end of 2017.
The next phase of international growth will not be without risk. Insight have experience of delivering such success. They will hope that Bullhorn can further cement their position in the market. Bullhorn gains a fresh pair of eyes and ears as well as new advisors. They have done well to date. If they continue the same growth trajectory, Insight will also consider it a good investment.