SAN FRANCISCO: In one of the biggest technology PR acquisitions since the boom and subsequent bust, Next Fifteen has acquired OutCast Communications in a deal valued at $13 million. The final payout is subject to performance criteria.
Next Fifteen, parent company of tech firms Text 100 and Bite Communications, will initially pay $6 million in cash and stock for OutCast, with an additional $7 million over five years, depending on OutCast?s performance.
Founded eight years ago by Caryn Marooney and Margit Wennmachers, who will both serve as agency presidents, OutCast?s clients include Dell, EMC, and Salesforce.com. Marooney and Wennmachers said nothing about the agency would change, except now they will report to Next Fifteen CEO Tim Dyson.
The founders saw the acquisition as the best means to grow the agency while remaining deeply involved in client services. While they do not have any immediate growth plans, Marooney and Wennmachers said they can now leverage Next Fifteen?s infrastructure for future growth and additional services, without getting buried in the minutiae of agency management responsibilities that often accompany agency growth.
That includes help growing internationally, or offering clients services such as public affairs via 463 Communications, a technology public affairs firm that Next Fifteen does not own, but backs financially.
?This allows us to continue to do our jobs, but also meet the growing needs of our clients,? said Wennmachers.
Marooney said OutCast has heard acquisition offers from other agencies that would have eventually changed what made OutCast unique, and attracted those suitors in the first place.
?[Those agencies] mess with the very thing they want to own,? added Wennmachers.
Discussions between Next Fifteen and OutCast took place for well over a year, said Dyson. And while Next Fifteen has looked at other agencies, it has pursued OutCast in order to build a roster of the best technology agencies in the business, he said.
Dyson said he does not foresee acquiring more agencies, unless it?s to merge with one of Next Fifteen?s firms, as it did in 2003 by acquiring Applied Communications, and merging it into Bite Communications.
?This [acquisition] helps put us in a strategic position, both in terms of market share and industry leadership.?