Smartsheet, a Bellevue, WA-based company that develops collaborative software allowing users to track projects and manage company processes, announced Tuesday it has acquired Seattle-based TernPro, whose flagship product Slope lets customers mark up documents, images, videos, and other media before releasing them to a wider audience.
Financial terms of the deal were not disclosed.
Smartsheet’s (NYSE: [[ticker:SMAR]]) and TernPro’s products both fit into the category of collaborative work management tools. But the software applications the companies sell have the potential to be complementary in many scenarios, Smartsheet says.
For example, a business that trains its employees to use the software or equipment it sells and creates its curriculum with Smartsheet could use TernPro’s tools to annotate handbooks and other training materials.
“Ninety-five percent of our product roadmap comes from customer feedback,” Gene Farrell, senior vice president of product at Smartsheet, says in an interview. Several of the company’s clients expressed a desire for tools that “better support work processes, projects, and initiatives that require markup and approval of content,” he says. In many cases, these teams are managing creative content developed by marketing professionals, Farrell says.
Smartsheet’s acquisition of TernPro could position the combined company to take in more of the money companies around the globe spend on marketing technology and services, which the research form Forrester projects will grow to $122 billion annually by 2022.
At the same time, competition between companies providing collaborative workplace tools is ramping up. Last July, collaboration software company Slack bought the HipChat and Stride products from Atlassian (NASDAQ: [[ticker:TEAM]]), which also made a small investment in Slack. Slack, which is taking on companies such as Microsoft (NASDAQ: [[ticker:MSFT]]), is rumored to be considering an initial public stock offering this year. Meanwhile, social media giant Facebook (NASDAQ: [[ticker:FB]]) is also investing in its business software, dubbed Workplace, which it enhanced last year with the acquisition of communications software startup Redkix.
Smartsheet, which went public in April, says it has 76,000 customers worldwide. Some of them also use TernPro’s Slope software, which brought the two sides together in late 2017 to discuss integrating the product with Smartsheet, a company spokesperson says.
The integration talks proceeded, with the two sides agreeing TernPro’s team would take the lead on the needed technical work, says Farrell, a former Amazon (NASDAQ: [[ticker:AMZN]]) Web Services executive.
But due to what Smartsheet calls an “opportunity to enhance the Smartsheet platform and bring Slope technology to a fast-growing, global user base,” a shift in the talks occurred, according to a document with information on the deal. Smartsheet and TernPro then began discussing the possibility of joining forces, Farrell says.
All seven people on TernPro’s team, including co-founders Dan Bloom and Brian Bosché, are joining Smartsheet, Farrell says. The TernPro and Slope brands will go away over time, he says.
“Our plan is to integrate the capabilities [of Slope] fully into Smartsheet,” Farrell says, adding that Smartsheet will support TernPro’s customers while the integration work takes place.
Smartsheet says it will communicate additional details to its customers—and TernPro’s—by the end of March.
TernPro has more than 100 customers, including Microsoft, SendGrid (NYSE: [[ticker:SEND]]), and the Oakland Athletics of Major League Baseball, Smartsheet says.
TernPro was founded in 2013 and created Slope the following year, according to a news release. The company was incubated in the Bizdom startup accelerator in Detroit before TernPro’s team moved to the Seattle area to participate in another accelerator, Microsoft Ventures, in 2015. TernPro raised more than $1.5 million from investors across two rounds of equity financing, according to SEC filings.
Smartsheet’s purchase of TernPro marks its second acquisition since the company was founded in 2005. A year ago, Smartsheet acquired Converse.AI, a U.K.-based developer of chatbot software.
