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The price
Airtable is a profitable company with a product that has loyal fans. It has about $480 million in annual revenue, growing 20% a year, and almost a billion dollars in cash. Counting that cash, the purchase is worth $2.25 billion.
The buyer
Bending Spoons is a Milan-based company that buys challenged but interesting businesses, including AOL's legacy business, Evernote, Eventbrite, Vimeo, and Meetup. It went public last month, and its shares rose 15% on the Airtable news.
Before the sale
Before the sale, Airtable spun its AI agent business, Hyperagent, out into a separate independent company. Commentary on the deal also pointed to a sales attainment figure: only 30% of Airtable's sales team was making quota.
Why do buyers like profitable but slow software?
Subscription software earns revenue every month from customers who rarely switch, which makes its cash flow predictable. A buyer can cut costs and raise profit margins without needing the business to grow quickly. That arithmetic is the basis of a whole style of investing in software companies. Firms such as Thoma Bravo and Vista Equity Partners have built their reputations on buying software companies and raising their profit margins.
Why do startup valuations fall so far from peaks?
A private company's valuation is set in a funding round, and in 2021 those prices rested on low interest rates and steep growth expectations. The Federal Reserve began raising its benchmark rate in March 2022, which lowered what investors would pay for future earnings. Public software stocks fell sharply that year, and private valuations were reset against them. Companies that raised money at the peak often found that later buyers would pay far less per dollar of revenue.
How does Airtable differ from a spreadsheet?
Airtable looks like a spreadsheet but works like a database. Each table holds records, and a field in one table can link to records in another, so a project list can connect to a list of people without copying data. Howie Liu, Andrew Ofstad, and Emmett Nicholas founded it in San Francisco in 2012. Users can view the same records as a grid, a calendar, or a board.
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