Certinia (formerly FinancialForce) has announced a change of ownership. Advent International and Technology Crossover Ventures (TCV) have sold their majority share of the firm to Haveli Investments, with participation from General Atlantic. Salesforce will continue its investment in the firm. While neither party revealed financial terms or a valuation, Reuters reports that the deal was valued at nearly $1 billion, including debt.
This brings to an end the sometimes stormy investment by TCV, which first invested in the company in 2015. It is a testament to Scott Brown’s success since he joined, that the valuation of Certinia has reached a point where it saw an appropriate return on investment.
Advent first invested in FinancialForce (now Certinia) in 2014 with a $50 million investment, and rumours were that TCV blocked some previous attempts at a sale. When Brown joined the company, the existing investors increased their investment, aiding the growth strategy he laid out.
Certinia delivers a suite of solutions built on the Salesforce platform, including Professional Services Automation (PSA), Customer Success, Services CPQ, ERP and FP&A solutions. Customers include Avalara, Celonis, Siemens, Cisco and Thales. It now has over 1,400 customers across 30 countries.
Scott Brown, President and CEO of Certinia stated, “Haveli has assembled a world-class team of investment professionals, and we are thrilled to partner with them as we enter this exciting next chapter for Certinia. We are very well positioned in a rapidly expanding market, and with Haveli as our new PE partner, we are confident we can take full advantage of growth opportunities and further enhance our ability to meet our customers’ ever evolving needs and help them achieve their full potential.”
Who are Haveli Investments
Haveli was founded in 2021 by billionaire Brian Sheth the Co-founder and President of Vista Equity Partners (2000-2020). Its initial investments were in the gaming industry, with investments in Omeda Studios and Behaviour Interactive. This is the first investment by Haveli into enterprise software. Since 2021 Haveli has grown rapidly. In October 2022, it partnered with Apollo, which made a $500 million commitment to Haveli strategies.
Ian Loring, Senior Managing Director and Executive Chair of the Haveli Software Fund, commented, “Certinia is the gold standard system of record for end-to-end software for professional services organizations, and its demonstrated continued ability to deliver market-leading capabilities underscores the Company’s impact and future potential. We are thrilled to partner with Certinia for Haveli’s first enterprise software investment, and we look forward to collaborating with the talented team there to continue its strong growth trajectory.”
What is next?
At Vista, Sheth oversaw all the investments and is no stranger to the type of solutions that Certinia delivers. Vista invested in BigTime (PSA), Aptean (ERP) and Vena (FP&A). Vena also partnered with FinancialForce in 2017. Sheth will no doubt have been aware of the firm for some time.
The current transaction is expected to close in August 2023. Once completed, the inference from Brown is that with a new PE partner, Certinia will be set to grow further. That growth may include acquisitions, but there is no indication that it will look to extend its suite that way.
Mike Stewart, Principal at Haveli Investments, said, “Certinia has an incredibly strong offering with a loyal and growing customer base. Given our team’s collective experience working with high potential companies in the enterprise software space, we believe Haveli is very well positioned to support Certinia through its next stage of growth and drive value creation for all of its stakeholders.”
Enterprise Times: What does this mean?
There is little financial information in the announcement and a lack of information on the Haveli website. Where the company was originally set up to invest in the gaming industry. It appears that the opportunity to invest in the future of Certinia could not be resisted. Both Advent and TCV have seen Certinia grow, and the sale will release its invested funds.
Brown will no doubt hope that Haveli will further invest in growth. Whether that its international expansion, investment in product or acquisition is unclear. Though it could be all three. This is a positive move for Certinia. It will gain new insights from a PE firm that has gathered a top team to lead its investments since it was founded.
The retention by Salesforce of its long-held investment. Which it invested in when the company was founded in 2009, is also important. The relationship between the two firms is close. If Haveli can help build Certinia into a larger, truly global business, then the next acquisition could be by Salesforce. Providing the ability to extend its solution set to Financial Management and PSA.
