When StarMobile CEO Todd Fryburger spoke to Hypepotamus in February, he said that 2016 would be a “transformative” year for his startup, a maker of software that allows companies to build customized mobile versions of their desktop work apps.
Exactly how transformative became clear Thursday when PowWow Mobile, a San Francisco-based company that also mobilizes enterprise apps, announced it would acquire the Atlanta startup. Financial terms were not disclosed. The combined company will use the PowWow name, and while the headquarters will stay in San Francisco, “we will maintain a presence in Atlanta,” Fryburger told Hypepotamus.
“Atlanta is truly a global locus for mobile technologies. We have a critical mass of customers, not just here but all along the East Coast. We have access to developers at agreeable price points, and that’s something of a hallmark in the tech community here, with the growth in Tech Square and Midtown. We intend to have a persistent presence around here.”
PowWow Mobile CEO Kia Behnia will be the CEO of the combined company, but Fryburger said he and Behnia are in talks about a “meaningful executive role” for him after the acquisition closes. “And not just on a short-term basis. I’m very excited about our companies coming together. I intend to see this all the way through. I couldn’t be more excited.”
“This is one of those moves for both companies that gives us both a chance to get to the finish line quicker without having to build duplicate technologies and compete with each other,” Behnia told Hypepotamus. “The majority of PowWow is on the West Coast, but we haven’t expanded to the East Coast. StarMobile has a fantastic presence there, and a lot of complimentary go-to-market solutions.
“We plan on increasing our forecast” because of the acquisition, Behnia added. That may be because the combined PowWow Mobile will have “the most comprehensive enterprise mobility platform, based on the richest IP and patent portfolio, in the industry,” according to a PowWow Mobile news release.
The two companies have a lot in common besides products and business strategies. Both were founded in 2012, both were chosen as “Cool Vendors” in mobile app development by the Gartner research firm, and both had extra cash on hand earlier this year: StarMobile celebrated a $500,000 National Science Foundation grant in February, and PowWow Mobile completed a $4.7 million funding round in May, bringing its total to $8.2 million.
Fryburger, who has raised more than $5 million to date, said he and Behnia have known each other for 10 years. He watched PowWow Mobile rise as rapidly within the industry as StarMobile, which had its beginnings at a Georgia Tech research lab. While StarMobile was being named a Top 5 Startup to Watch by Venture Atlanta, sealing partnerships with HP and adding to its patent portfolio, PowWow was enjoying triple-digit bookings growth from 2014 to 2015.
The two men reconnected earlier this summer, and that’s when the acquisition talks began.
“We never really saw each other as competitors, but we had a lot of commonalities,” Fryburger said, since both companies were dedicated to helping businesses mobilize their favorite apps “quickly, simply, and cost effectively,” with minimal user learning curves and no need to write specialized code.
Fryburger was impressed with PowWow Mobile’s SmartUX solutions, which he said “puts the power of the technology in the hands of the customer. The (SmartUX) studio offering they have is very, very powerful.” There’s also PowWow Mobile’s ability “to take legacy Windows applications and extend those out to any Windows 10 footprint, whether mobile or PC. There’s still a ton of legacy Windows applications. We had that capability on our road map but it’s really a lab experiment for us.”On the StarMobile side, Fryburger’s company debuted an analytics suite last year that had gained recognition within the industry because it “allowed companies to look at real-time performance in apps and how they were used. That was road-mapped for PowWow folks.”
“I would also add the cultures of the two companies are extremely similar,” Behnia said. “It’s one of the reasons why this has been a lot of fun and continues to be a lot of fun, working with Todd and his team, that joint vision. As we went through this process it became clear to us that we could accelerate that vision and execute on that vision.”
Both startups made the decision to prioritize patent filings and intellectual property protection, which sometimes becomes a casualty for younger companies that have to make tough financial decision. Now the combined PowWow Mobile IP portfolio “is something that is absolutely unheard of in our market,” Behnia said. “IP protection is very important. It’s not a niche market. We see a broad market, we see a lot of companies having to address similar issues. Both StarMobile and PowWow had unique ways of addressing these methods.”
Behnia is also anxious to extend the PowWow brand to Atlanta and its vibrant tech community. “Atlanta is a big center for many of our joint customers,” he said. “During this process we’ve made several trips out there, and we understand the passion the city has for mobile technology. We want to be a part of that.”