Contact: Scott Denne Adrian Sanabria
Earlier this year, we took a look at M&A possibilities for the cloud application control (CAC) market, and pegged cloud SSO/IAM products as a good matchmaking opportunity. That’s exactly what’s happened with LogMeIn’s acquisition of Meldium. The acquirer’s AppGuru product allows enterprises to monitor and control employee access to SaaS apps. With authentication being the key chokepoint for CAC services, the ‘melding’ of Meldium’s offering with AppGuru could give LogMeIn customers an opportunity to address two issues with one stone.
The $15m price tag (including an unspecified earnout) for Meldium is a typical deal size for LogMeIn, which has built a diverse set of SMB applications, mostly organically, having only made four acquisitions (all between $7.5-16m) since its debut as a public company in 2009. One difference with its Meldium purchase: LogMeIn is jumping on the target earlier than it typically does. Meldium is a year out of its stint at Y Combinator, whereas Ionia and Bold Software, LogMeIn’s two most recent targets, had more than two decades of operations between them when they were picked up.
While LogMeIn has plenty of cash ($220m and growing) and equity to do larger deals, its M&A activity has been light, opting instead to lean on internal development to expand into areas like collaboration, Internet of Things and IT management for SMBs from its starting point in remote desktop applications. Small, tactical buys have served LogMeIn well – it’s projecting 30% revenue growth this year to $217m, outpacing the 15-20% gains it has put up in each of the past three years.
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