West Monroe Digital Strategy Targets $1 Billion Valuation By 2025
This is technology M&A deal number 593 that ChannelE2E has covered so far in 2021. See all technology M&A deals for 2021 and 2020 listed here.
The deal reinforces a growing trend that involves IT solutions providers acquiring digital- and product engineering-type companies. For instance, IT solutions provider Mphasis acquired Blink UX, a user experience (UX) design, earlier this week. Accenture also has been an active buyer in the digital engineering market.
Attune to customer and investor trends, West Monroe has earmarked roughly $250 million on various digital initiatives as part of a larger Be Digital plan. Among the goals: Reach a $1 billion valuation by 2025. The company did not disclose its current valuation.
M&A: About West Monroe and Versys
West Monroe is a Chicago-based consulting firm with 1,500 employees and offices in eight U.S. cities. The company has three digital investment priorities:
- Build a global product development platform that “creates the scale and efficiency needed to design, build, and manage digital products for Fortune 1000 and mid-market clients.” The build-out includes plans for more acquisitions.
- Train all West Monroe employees to deliver world-class digital consulting services for select industries.
- Develop technology and assets that help West Monroe deliver faster, better consulting services to clients, including investments in its Intellio suite.
Acquiring Verys aligns with those goals, and will “significantly boost West Monroe’s ability to build and manage digital products for clients as it begins to globally source tech talent,” the buyer said.
Verys, founded in 2012, is headquartered in Santa Ana, California. The company has more than 220 employees, most of whom work remotely. In fact, 15 percent of Verys employees are based in Costa Rica. The overall team includes engineers, UX designers, DevOps specialists and project managers who specialize in building software. Co-founders Chris Antonius and Mike Zerkel will continue to run Verys as a West Monroe-owned company. Integration is expected to be complete in early 2022, the buyer said.
West Monroe: Executive Perspectives, M&A Experience
In a prepared statement about the acquisition, West Monroe Chief Strategy Officer Tom Bolger said:
“Verys brings a strong level of talent, extensive experience in building world-class digital products, and a culture that values quality, craftsmanship, and people. Their understanding of the product lifecycle and agile approach is exactly what our clients need to become more digital organizations.”
West Monroe has acquisition experience. Previous deals include:
West Monroe’s digital product consulting sales were 76% higher in the first half of 2021 compared to all of 2020, though actual dollar figures and profit figures were not disclosed.
Additional insights from Joe Panettieri.