All Covered Continues Acquisition Run With Purchase Of Analysys
Analysys marks the fifth major acquisition for All Covered this year. The Redwood City, Calif.-based IT services firm previously acquired solution providers MainBrain, another Baltimore area solution provider; Escape Key in Minneapolis-St. Paul; Atlanta-area solution provider MyrtleTech; and 2009 CRN Fast Growth member The I.T. Pros of San Diego.
Details such as the price of the acquisition weren’t disclosed, but Steve Kolbe, founder and CEO of Analysys, and Todd Croteau, COO of All Covered, spoke with CRN about how the deal came to life. Kolbe, who founded Analysys in 1995 at the age of 18, built the company up from a small IT services shop to a strong regional provider of SMB-focused consulting, outsourcing and cloud computing solutions.
Kolbe said his company made its first investments in cloud computing in early 2009 and since then has watched the practice grow to become a crucial part of Analysys’ business. Specifically, setting up virtualized small business servers and networks became an extremely popular solution for clients.
“It was a wildly successful move. About 85 percent of our net-new clients had some type of cloud component,” Kolbe said. “We were very much in a leadership position in our market.”
At its height, Analysys had approximately 45 employees and a client list of more than 275 companies primarily located in the Baltimore-Washington, D.C. area. Kolbe, however, looked to sell the business this year after deciding to move overseas with his family. “I knew and respected All Covered, and we had been spirited competitors in the past,” Kolbe said. “I was looking for an exit plan, and All Covered reached out a few months ago.”
For All Covered, Analysys’ regional focus and strong virtualization and cloud computing practices became attractive assets, according to Croteau. “At the start of this year, we had no real presence in the Baltimore and [Washington] D.C. area,” he said. “We made an acquisition in that area in February [with MainBrain] and now we’re strengthening our presence even more with Analysys.”
Croteau also said solution providers that specialize in providing cloud services for small businesses are rare. “A lot of the organizations we talk with don’t have any cloud component at all,” he said.
Kolbe said merging with All Covered became "a no-brainer"; he knew All Covered has a successful track record with acquisitions and was confident the company could take on Analysys’ clients as well as its staff. He also said the integration process with All Covered exceeded his expectations. “Everything that All Covered said it was going to do, it did,” Kolbe said. “Employee retention was extremely high, too. Essentially the entire staff decided to stay on with All Covered.”
Kolbe also joined All Covered’s executive team as an advisor, despite his plans to relocate overseas, and will stay with the company for at least a year or two to make sure the transition and integration process remains smooth. Analysys will become part of All Covered’s Baltimore office.
Croteau, meanwhile, said All Covered will continue to grow the company through acquisitions of regional SMB-focused solution providers. “We’re targeting roughly a dozen acquisitions a year for the next few years, with some companies being smaller than others,” he said. “It’s a bit of a land grab right now. The solution provider market is highly fragmented, and there’s a lot of interest in mergers and acquisitions. Activity has definitely heated up in the last year.”