In August, I participated in Where is Everywhere, a market spotlight webcast from World Financial Symposiums, where I examined the significant consolidation in the overall geospatial and location-based space, highlighting ten key deals from the previous 80 days. Were seeing sellers from new countries and several segments including imaging, planning, and GIS, which are concentrated in the Horizontal and Vertical markets.
Weve seen vertical market software company valuations bobbing along around 2x sales recently. Of course, higher numbers are possible for filling a critical strategic niche just as the wave peaks. And a wave is clearly on the move through the Vertical market companies in the Geolocation space, particularly in fleet management. These are among the most mature geolocation applications, so thats no surprise. Verticals tend to accrete additional features and tech like an oyster builds a pearl, but the seed for each has been tracking and applying geodata.
The biggest of these was Verizons takeover of Hughes Telematics for over $600M. Hughes broad line of geodata applications and related technology will expand Verizons auto and fleet telematics, and it yielded a healthy multiple for the owners.
Trimble lived up to its reputation and record as a serial acquirer by snagging two geo companies, including Canadas GeoTrak, which makes GPS-based fleet tracking and navigation systems for oil and gas companies.
Telogis kept growing its location-based SaaS portfolio by reaching into the SMB market and coming up with Marylands Navtrak GPS fleet management outfit.
Finally, Harman, the audio products company, entered the market to buy Indias Interchain, a maker of GPS-based fleet tracking and handheld nav systems. This is an example of finding a buyer in an adjacent market through a global search.
In the Horizontal market, valuations have remained generally higher, but less dependably so as disruption continues. But if youre one of the disruptors, life can be good.
The clarion call of social media, though sounding a bit flat for the big consumer companies like Facebook lately, still gets the buyers dancing when it harmonizes with other popular notes like Geolocation, Mobile, and Cloud. Make it a chord for Trimble with its other catch, Spime, whose US and Indian teams integrated its MapMan location-based cloud services platform with social solutions for mobile devices.
Some would say billion-dollar industry behemoth ESRI wants to hear only one tune; if so, last month helped assure that will remain the case as it assimilated one of the pioneering social mapping and geodatabase upstarts, geoIQ, formerly known as FortiusOne, who have long and passionately applied themselves and about $11M in VC funding towards their ambitious vision of a geoCommons.
One of those VCs was In-Q-Tel, the venture funding arm of the United States CIA. On that same day last month that ESRI bought GeoIQ, the spooks also transitioned their investment in Geosemble, a Big Data geospatial extractor/integrator, as it became part of TerraGo, yet another In-Q-Tel portfolio company.