Publicly-held Jive Software, a pioneer of the enterprise collaboration software market that helped establish Portland, Ore. as a technology center 13 years ago, is in the process of being taken off the Nasdaq chart by a private equity firm.
The company, which moved its headquarters to Palo Alto, Calif. in 2010, revealed May 1 that it is being acquired by Austin-based ESW Capital through one of its affiliates, Wave Systems, for $462 million in cash, or $5.25 per share. Jive subsequently will join ESW’s Aurea software group; both companies said they expect the transaction to be completed by next month.
On its corporate website, ESW Capital said it focuses on buying, strengthening and growing mature business software companies. Its affiliated companies have been in the enterprise software space since 1988; the group includes brands such as Aurea, Ignite Technologies, Trilogy, and Versata.
When the deal closes, Jive will become the newest member of the Aurea technology solutions group that brings so-called “transformative customer experiences” to about 1,500 customers worldwide, including Disney, British Airways, Bank of America, United Healthcare and MetLife.
Acquisition May Result in Integrated Customer-Facing Platform
Aurea specializes in brand loyalty software and services. Jive's core product, Jive Engage Platform, enables colleagues, co-workers and often their partners to communicate and collaborate with user profiles, group forums, status updates and other tools used in modern social networking.
Thus, Aurea and Jive will align to integrate customer and employee interactions into a single collaborative platform that can be controlled and monitored from a central management dashboard.
Jive went public in August 2011, banking about $100 million. It share price reached a high of $27.16 on March 1, 2012, and had been treading water in the $5 range for roughly the last three years.
Jive’s Interactive Intranet and Customer Community solutions are used by more than 30 million people around the world and about 1,000 companies.
Lots of Competitors in This Market
However, in last half-dozen years the market had become flooded with competitors that include Slack, Workplace by Facebook, IBM Connections, Salesforce Chatter, Box, Dropbox, Microsoft Office 365 Groups (formerly Yammer) and several others. Jive, while embedded deeply in the cultures of about 1,000 companies, remains a marketshare mainstay, but the company’s overall value had stalled.
In a note to employees May 1, included in a regulatory filing, CEO Elisa Steele wrote that Jive's investors didn't have the patience to wait for the company to reach its goal of achieving growth and profitability at the same time.
"We've realized that getting Jive on a faster growth trajectory, while also delivering profits quarter-by-quarter, is going to be a challenge over a short period of time as a public, standalone company," Steele wrote. "Given our size, we simply don't have the scale necessary to invest as fast as we would like in a market where supersized companies are investing and bundling."
Steele, a longtime Silicon Valley executive, has been with the company for about two years.
Company Will Make Adjustments
“Jive had been built on the social network within the enterprise, growing very quickly and leading to a very successful IPO,” Steele told eWEEK back in February. “We were the leader in creating a new category, the ‘consumer social-network way’ to communicate and bring collaboration to the enterprise for people.
“But what Jive saw then, as now, is that social networking inside the enterprise wasn’t the ultimate goal of the company. That goal is to enable people to work together better; to use tools and connect better in ways they never had before.
“With Jive and Aurea coming together, we can now deliver the superior end-to-end employee and customer experience companies require in today’s digital landscape,” Steele said.
Aurea provides the technology platform and worldwide delivery capability to enable companies to build, execute, monitor and optimize the end-to-end customer journeys across a diverse range of industries, Steele said.
“Jive, in combination with Aurea, enables us to bring customer experience and employee and customer engagement together. We look forward to helping Jive clients get the maximum value out of their investment with Jive,” said Aurea CEO Scott Brighton.
MarketsandMarkets has projected that the overall Enterprise Social Software (ESS) Market will be worth $8.14 billion by 2019.