Tibco Software, an enterprise integration and data analytics player, announced yesterday an agreement to acquire Information Builders (IBI), a pioneer in business intelligence (BI) and enterprise reporting. Terms of the deal were not disclosed, though Reuters has reported that the deal may be valued as high as $1B.
ZDNet spoke to the CEOs of both companies, who explained the synergies they see arising from the acquisition. In describing the two companies' courtship, IBI CEO Frank J. Vella thought compatibility was very high: "...you're not often in a luxurious position to pick your buyer; it has to be mutual," Vella said. He added "...there was a lot of interest. We were pleasantly surprised and flattered at the interest." Vella also remarked that people, product and customers were IBI's biggest priorities in assessing the right buyer, and that Tibco excelled in all three areas. He further opined that the product portfolios seemed mostly complementary.
Tibco CEO Dan Streetman agreed with Vella's assessment on compatibility, saying "To Frank's point, the place where we have potentially the most overlap in a Venn diagram might be in visualizations and analytics, but we have this thesis that analytics are way more than BI and way more than visualizations. It's hyperconverged analytics, and that really extends all the way to the integration and the data preparation...so we see a lot of great synergies in culture, but also in products." Streetman also feels that, when taking into account situations where the two companies have a presence in different parts of the same company, that the real overlap in customer base would be 20% at most. Streetman also commented that he expects the merger to close in Tibco's next fiscal year, which begins on December 1st.
Software on the Street
If you grew up in the tech consulting world on Wall Street, as I did, you know both companies' names pretty well. Information Builders was co-founded in 1975 by native New Yorker and longtime CEO Gerald Cohen, and for many years was reputed to be the largest software company in New York City. In the company's early days, its FOCUS platform made reporting on mainframe data much easier, with its own 4GL (fourth-generation language) for creating the reports. IBI then ushered in full-fledged business intelligence for many customers in financial services, healthcare and other enterprise sectors.
In addition, from 2001, IBI had a sister company, iWay Software, which was a very successful enterprise integration vendor. At one point, Microsoft acquired many of iWay's connectors and put them "in the box" (i.e. bundled them, for free) with its BizTalk Server integration platform. While that and other events seemed to knock significant wind out of iWay's sails, it remained a healthy legacy business for IBI. Longtime legacy customers, and their loyalty, have been IBI hallmarks for years. Tibco, founded in 1997, meanwhile, created integration software that could work at the speed Wall Street trading floors needed to turn orders into trades, seemingly infallibly. If you believed all the (highly paid) consultants building those systems, no competitor could come close.
In their more mature years, both companies endured challenges and launched comebacks. While Tibco quickly went public in 1999, it was taken private again 15 years later by Vista Equity Partners and it regrouped. In early 2019, Gerry Cohen stepped down as IBI CEO, handing the reins to then COO Frank J. Vella, who joined the company right as Goldman Sachs' Private Capital Investing group had made a significant investment, in 2017. In 2018, while Vella was still COO, IBI announced a major revamp to its WebFOCUS platform.
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Tibco has built up its data analytics stack significantly over the years. It acquired self-service BI (SSBI) player Spotfire (initially a peer to Tableau and Qlik in the early days of SSBI) in 2007. In 2013, Tibco scooped up complex event processing vendor StreamBase, and it grabbed open source BI and reporting tools vendor Japsersoft the following year.
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Tibco acquired Statistica from Quest Software, CISCO's Data Virtualization business (originally the independent Composite Software) and AI-focused Alpine Data Labs, all in 2017. In 2018, Tibco added integration Platform as a Service (iPaaS) and Master Data Management (MDM) through the acquisitions of Scribe Software and Orchestra Networks, respectively. And last year, Tibco added in-memory database technology to its bag of tricks by buying SnappyData.
In addition to the significant portfolio assets mentioned above, Tibco has long had its own proprietary cluster computing distribution of the R data science language, known as Tibco Enterprise Runtime for R, or TERR. TERR was integrated within Spotfire several years ago, adding AI capabilities to that BI platform.
Pull it together?
But even with these significant BI, streaming and AI assets, and the addition of IBI's WebFocus platform, will Tibco be an analytics powerhouse? Perhaps ironically for an integration specialist, Tibco has had some technical debt around unifying, rather than just owning, all of its constituent platforms; adding Information Builders' and iWay's portfolio will only add to the challenge.
Regardless, what Tibco definitely does get out of this deal is a formidable set of enterprise customers, to whom the analytics technologies already under its roof may appeal, especially if Tibco can be those customers' proverbial one neck to choke, in supporting all of this.
Whether customers or a sense of elegance might be the catalyst, Tibco would do well to merge and purge all these analytics chess pieces. Applications are becoming data sources, and Tibco's twin focus on data analytics and enterprise systems integrations puts it at a well-positioned strategic nexus with which to accelerate digital transformation for all its customers. But the pieces aren't enough; they need to be assembled correctly to solve this Industry 4.0 puzzle. Can Tibco do it? In the name of emancipating all the latent value in its holdings, I sure hope it tries. With Information Builders being Tibco's biggest acquisition ever, it has ample motivation.