We have something special to share: AdEspresso joins Hootsuite

We’re extremely excited to announce that AdEspresso has agreed to join forces with Hootsuite.

You can find Hootsuite’s Press Release here and some coverage from TechCrunch and from Venturebeat.

While we will not be disclosing the exact terms, this really is a special thing for several reasons.

• It’s the biggest acquisition of 2016 in Italy, and one of the 3 biggest acquisitions in the last 5 years. While AdEspresso has always had its headquarters in San Francisco, it always had an Italian heart too. The first investors after 500Startups were Italian, the product and design of AdEspresso were always “Made in Italy,” the founders are Italian as well. It’s a big win for the Italian ecosystem, hands down.

• It’s an important acquisition for Hootsuite which at the same time speaks volumes of how both companies are looking at the future, since this is one of those rare cases where 1 + 1 = 4. Hootsuite already had a partnership in place with AdEspresso, while AdEspresso has been profitable for the past 20 months… there was no real pressure to make it happen beside the strong conviction on how the market is evolving. More on that in a bit.
  

• It’s also the result of a connection born in Silicon Valley but through value generated mostly outside of it, in different ecosystems (Canada and Italy). Our hunch is that you’ll see this more and more. Because of how expensive and competitive the Valley has become (I wrote about it a while back here), it’s more and more functioning as the “NYSE for private companies”.
• Finally, it’s a big win of the mid-sized M&A, where founders raise some capital but not too much, focus on execution and growth and revenue, maintaining the ownership and flexibility to consider and eventually accept outcomes that are life-changing for them and generate great returns for their investors… but are ultimately a big ‘narrative violation’ of the classic Silicon Valley story, where the only acceptable outcome is $1B+.

If you’re curious to know more about how it all went down, we’ve published the backstory (where we reveal all our learnings along the way) here. M&As are by far *the* most obscure processes of the startup industry, so we thought interesting to tell that part of the story too. But what’s really important now is the “why.”

So: why did we do it?

Well… of course you would think we did it for the money. But that’s not really the point: when you’re running a profitable company that grows 300% year-over-year with $8M working capital, more important than money is the value generated in the market and the recognition for the work done so far. You don’t actually start a company to make money; there are other easier and faster ways to do it.

You do it because you have a vocation for what the company does. And if that’s the case, you quickly discover that money is not the reward, the reward for good hard work is being able to do even harder work. Also, as the saying goes: “if you want to go fast, go alone; if you want to go far, go together”.

Sounds trite, but that’s really the case. AdEspresso surely grew fast in these 3 years: from zero to 40+ people, 5k+ customers, 100k+ subscribers, 350k+ monthly uniques, $25M/mo+ AdSpend processed… it’s hard to believe it, but today we’re the most widely used Facebook Advertising Optimization Solution in the world.

That growth potential is far from fully realized and maxed out, tho. If you look at how the market is evolving, there are several reasons why the Hootsuite+AdEspresso combination is an extremely powerful one and makes all the sense in the world.

Specifically:

• There’s a convergence between organic and paid, which is clearly happening. As social platforms become more mature and more content is created, organic reach naturally decreases. It becomes critical to have an effective integrated organic+paid strategy. This is not a bad thing per se; it’s just how social works. Hootsuite and AdEspresso joining forces solve exactly for that.
• There’s also a clear emergence of the mid-market as the most powerful driver of growth in the near and long term future. Big brands and enterprises are usually the first movers with the big firepower, but scale is really reached when the mid-market starts to engage. Hootsuite and AdEspresso, combined, pack both the enterprise expertise and the mid-market reach, each from their respective viewpoints (organic on one side, paid on the other).
• “Tool fatigue” is real. Every day new marketing solutions are launched in a market that’s hyper-fragmented already… it’s hard to keep track of what’s new and what works, it’s even harder to make it work together with the existing marketing technology stack. Having two best-in-class technologies like Hootsuite and AdEspresso joining forces and deeply integrating between each other, elegantly solves for that too.
• On top of the things above, there are real synergies and tangible complementarities between the two companies that will enable them to generate more value more effectively for our respective customers. Among others: the design and educational focus on the AdEspresso’s side, the scale and reach as well as an extremely well-oiled salesforce and support infrastructure on the Hootsuite’s side.

Plus: one more key driver for us

It has been the people. There are a couple of angles to this. The first: one of the common truism you hear all the time is that startups are agile and quick, while bigger organizations are not. Hootsuite is an exception. We were seriously impressed by the speed of their team across the board.

More than once, it was us kinda struggling to keep the pace. That’s one of the benefits of being part of a more mature organization – you can rely on more specialized people/roles coming together to make things happen, each one of them in his/her respective capacity with a common goal in mind.

The second angle is that in Hootsuite we found a team that is not only great at what it does, no exceptions, but that cares about people. It cares about being in a positive, collaborative and friendly environment where people look out for each other and strive to be their best. That’s something rare.

Finally: we both deeply care for our customers. Everything we do, we do it for them. Every product decision, every marketing choice, every dollar invested, every person allocated… is to make our customers’ lives easier. You don’t become the best-in-class solution of your category otherwise.

A few words on what’s next

With that in mind, it’s probably useful to dedicate some time to share what’s gonna happen moving forward. One of the special things about Hootsuite+AdEspresso joining forces is that AdEspresso will continue to operate as an independent business unit within the Hootsuite organization.

So all the things we were writing about here on “AdEspresso Phase 2” are still where we are going next… only, with more resources and firepower than ever before, as part of Hootsuite, which is simply *the* best social media management platform in the world. We’re extremely excited about that.

And we want to celebrate this special occasion with the Hootsuite and the AdEspresso customers as well. In that spirit, we’re launching not one but two new products for the AdEspresso’s customers next week (one of which totally free – stay tuned), as well as a super special limited promotion for *all* Hootsuite customers which starts right now.

Here’s to an exciting new beginning!

A very special gift for you

If you’re reading this and you’re a Hootsuite customer: check your email, you’re in for an awesome surprise. And if you didn’t receive anything, ping the Hootsuite Support Team or your Hootsuite Point of Contact if you have one. They will be more than happy to help and give you further details.

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