By Lori Hawkins
Austin-based business software company Silverback Enterprise Group has acquired two cloud software companies and is looking for more.
Silverback, which is backed by $50 million from Austin Ventures, will announce today that it has purchased Boston-based PowerSteering Software — which sells software that helps corporate customers manage projects, IT governance, new product development and other business — and Tenrox, a Montreal, Quebec-based company whose software helps customers manage global workforces as they collaborate on projects.
Financial terms were not disclosed.
PowerSteering and Tenrox will be combined under the name PowerSteering Software. The new company, which will have 250 employees, will be headquartered in Austin. Silverback founder Jack McDonald will serve as chairman and CEO.
Most of PowerSteering’s employees will remain where they are currently based, and the company will add some additional positions in Austin, McDonald said.
McDonald teamed with Austin Ventures in 2010 to form Silverback after stepping down as chairman of Austin software company Perficient Inc. He was CEO of Perficient from 1999 to 2009.
Silverback is part of Austin Ventures’ strategy of teaming with seasoned executives to build new companies. The Austin-based venture capital firm typically commits $50 million to make acquisitions and develop new technology. The goal is to create market-leading companies that can be taken public or sold.
Silverback is buying companies that develop software for corporate customers, with a focus on those that have standout products and marquee clients but have been unable to achieve rapid growth independently.
“Enterprise software is a $200 billion market, and there is a huge group of really solid companies that can’t break through the $20 million revenue mark,” McDonald said last year. “Only a handful of companies are ultimately going to be IPOs or big exits, and the rest are acquisition opportunities for us.”
Founded in 1998, PowerSteering has raised $16 million in venture funding and has customers including Johnson Controls, Merck and the U.S. Department of Defense. Tenrox, founded in 1995, raised
$4 million; its customers include IBM Corp., General Electric, the U.S. Army and Blue Cross Blue Shield. Neither PowerSteering nor Tenrox discloses financial information.
The newly formed PowerSteering will have 500 active customers in more than 50 countries.
“We’re actively pursuing additional acquisitions in the project and portfolio management space because we see a tremendous opportunity in the cloud,” McDonald said. “Multinational companies at any given time have dozens of strategic initiatives under way, and this software gives them the insight they need into what is happening with their projects and their teams around the world.”
Silverback has done one previous deal: Last year, it bought Visioneal Corp., a Mountain View, Calif.-based company that sells network management software to large corporate customers. Terms were not disclosed.