Agosto

Cherry Tree Advises Agosto on their Sale to Pythian, a Portfolio Company of Mill Point Capital.

“After our initial meeting with Cherry Tree, it was apparent that they were very knowledgeable about our industry and would be the right company to represent Agosto,” said Irfan Khan, founder and former CEO of Agosto. “Cherry Tree acted as trusted advisor to Agosto for four years, helping us position the company for an eventual sale. They served us with thoughtful guidance and integrity, ultimately helping us make sound decisions that culminated in a successful sale.”

Irfan Khan, Founder and Former CEO of Agosto

INDUSTRY:
IT Services, Technology, Business Services

DESCRIPTION:
A Premier Google Partner, Agosto is an Award-Winning Cloud Service Company

LOCATION:
Minneapolis, Minnesota

TRANSACTION TYPE:
Sale to a Private Equity Backed Strategic Buyer

The Opportunity:

Agosto was founded in 2001 and grew organically to become one of Google Cloud’s top channel partners, receiving Partner of the Year awards for performance in 2013 (Global) and 2016 (Americas). Cherry Tree’s Executive Director of its technology practice approached Agosto in 2016 as the public cloud market was beginning to heat up and Google Cloud was gaining traction. Having received inbound interest from multiple strategic parties, Agosto retained Cherry Tree to act as its exclusive representative and investment banking advisor. Since then, Cherry Tree has provided advice on the Company’s strategic and financial plans, including key business decisions and alternatives related to the sale and capitalization.

Cherry Tree advised Agosto shareholders on the complex task of selling its core business while maintaining ownership of its digital signage SaaS business unit called Skykit. Given Agosto’s compelling business model, market presence and reputation as a Premier Partner of Google, the process attracted the interest of multiple financial and strategic parties. Mill Point Capital’s proposal to combine Agosto’s re-seller model with Pythian’s global professional services capabilities was compelling and resulted in the best strategic opportunity for the Agosto shareholders.

Cherry Tree’s Role:

Cherry Tree was retained by Agosto shareholders to advise them on business and capital strategies to support their vision for continued growth in Google Cloud products and services. It was important to Agosto that its customers, employees, and partnership with Google were strengthened while they capitalized on the explosive growth of public cloud platforms within enterprises large and small. Cherry Tree advised Agosto through the development of business plans, financial reporting, and strategy formulation. Cherry Tree then led the Agosto shareholders through a process of discussions with Mill Point Capital and Pythian, coordinated due-diligence, negotiated terms and ultimately facilitated the closing of the transaction.

Outcome

Agosto was acquired by Pythian Services Inc. (“Pythian”), a leading cloud data and analytics services company. Pythian, a Mill Point Capital portfolio company, has been helping organizations use data, analytics, and the cloud to transform and win for over 20 years. Agosto shareholders have retained 100% ownership in Skykit.

About Agosto

Agosto is an award-winning cloud services company and one of the largest and most innovative Google Cloud Platform Partners in the world with specializations in IoT, Infrastructure, Application Development and Work Transformation-Enterprise. The company helps organizations leverage Google Cloud products by providing technical solutions, change management and training, migration and deployment from legacy systems, ongoing admin support, and custom product development.

About Pythian

Pythian is a global IT services company that helps organizations transform how they compete and win by turning data into valuable insights, predictions and products. From cloud automation to machine learning, Pythian designs, implements and supports customized solutions to the toughest data challenges. A Google Cloud Premier Partner with specializations in Cloud Migration, Data Analytics, Machine Learning, and Infrastructure, Pythian was also named 2018 Google Cloud Data Analytics Partner of the Year.

About Mill Point Capital

Mill Point Capital is a private equity firm targeting control investments in lower-middle market businesses, with a focus on industrials and business services companies in North America. Mill Point’s experienced team of investors and Executive Partners seek to enhance the value of portfolio companies by executing transformative strategic initiatives and operational improvements. Mill Point is based in New York, NY.

About Cherry Tree & Associates

Cherry Tree & Associates is a private investment banking firm headquartered in Minneapolis, Minnesota. Founded in 1980, it specializes in M&A transactions for both buyers and sellers of middle market companies. Additionally, it conducts private placements for attractive, entrepreneurially managed growth companies, provides strategic advisory services to CEOs and boards of directors, and prepares fairness opinions and other valuation services.