SparkPost has agreed to buy the U.S. email marketing firm MessageBird for $600 million, marking its fourth deal since October.
The Dutch software company raised $800 million from investors to finance the all-cash deal, which will intensify Messagebird's focus on North America and its competition with US-based rival TwilioTwilio Inc.
'We currently have about 20 people in the U.S. but at the close of this transaction we'll have around 300, said MessageBird Chief Executive Robert Vis in an interview. If there was ever a move we are making in the USA it is this one.
SparkPost sells software that companies such as LinkedIn and Adobe Inc. use to send marketing emails and analytics tools to measure and improve how many people open and read them. The deal is expected to close in the second quarter of 2012.
When we broke the deal, we didn't have the money to pay for it, so we raised twenty million dollars in 21 days, he said. 'It was an exclusive process, which meant there were no bankers. We agreed on a price that made sense for all us and then we had a time frame to go raise that money by showing that we could actually pay it.
MessageBird, which has completed a trio of acquisitions as recently as March, sells tools to companies that let them add a few lines of code to their app or website so customers can text, email, video conference or call in with questions. It also works with telephonic operators worldwide to deliver SMS and instant message alerts such as two factor authentication codes or weather warnings.
The SparkPost technology significantly extends MessageBird's investment in Email and puts it in direct competition with companies such as Mailgun and Sendgrid.
Other participants in the fundraise comprising Eurazeo, BlackRock Inc., Owl Rock Capital and Tiger Global according to a statement. Nathalie Kornhoff-Bruls of MessageBird will join Eurazeo's board.
MessageBird was recently valued by investors at $3 billion and is expected to be ready for an initial public offering as soon as this year. Acquiring SparkPost strengthens its domestic rival with Twilio, valued at around $67.8 billion four years after it listed at $1.23 billion in the market value.
Vis said it was still going to be a 10 year-old MessageBird's intention to be ready for an IPO this year, but that it remained an option rather than a goal or necessity. He said the speed and volume of capital that his firm was able to raise in just a few weeks shown that access to funds was not a roadblock to growth.
The SparkPost Deal is a quick turnaround for some of its backers. The Wall Street Journal reported in January that the email marketing company, from investors including Kohn Partners, NewSpring Capital and PNC Bank, has raised more than half of which was in the form of equity.