With the pace of change in technology growing fast, companies are being forced to tap into the start-up eco-system to be able to tap into the next big bet. IT solutions and product firm Persistent Systems has similarly acquired Pune-based start-up Hoopz as it looks to capitalise the opportunity that technology and data discovery is throwing up.
Hoopz is in the web discovery technology space and founded by Akash Surekha in 2011. At the time of acquisition the company had seven employees. The financial details of the deal were not disclosed. For Persistent that has been investing in creating intellectual property within the company and has also been investing in innovation by supporting start-ups through its venture funding arm, Hoopz is an early bet that fits into its mobility focus and into the real time contextual data discovery of large structured or unstructured data to enterprise users.
“We did have the option to invest in the company through our venture arm too, but the technology and space that Hoopz is made us believe that acquiring them would be better,” said Anand Deshpande, chairman and MD, Persistent Systems. Deshpande also explains that though the application fits into the consumer internet space it can be scaled into the enterprise set-up too.
Persistent has opted for in-organic route in the past too, to tap into opportunities. In the last three years, the company has acquired eight firms. Last year it had acquired CloudSquads, a US-based enterprise social apps platform provider.
Hoopz set-up towards the end of 2011 by Surekha is already working with some of the original equipment manufacturers. “We realised that the web experience on the smartphones is very fragmented. Especially, when you are searching something. Our technology allows you to move away from world of manual search to auto discovery based on consumer context and needs,” said Surekha, who now joins Persistent and will focus on taking Hoopz to international market.
As a strategy, Hoopz is targeted towards hardware manufacturers than the application eco-system. “Hoopz is not hardware dependent, but as a technology framework layer it needs to be integrated into the operating system. Hence we prefer to work with OEMs. At present Hoopz is with over half-a-million handsets,” said Surekha. Going ahead the company will focus on international expansion into regions like APAC and China.
The acquisition fits in Persistent’s focus area of mobility and though Hoopz is consumer focused, Deshpande is betting on the data discovery platform than can be scaled to the enterprise segment. “Our objective is to align technology and the company. We keep looking at technologies and see how we can participate in them. This also means taking smaller companies to a bigger core group,” added Deshpande.
When asked Deshpande by when will Hoopz acquisition start to show on the firms balance sheet, he said: “We believe in Hoopz technology. The real revenue from them will take some time. Their sales to revenue cycle is also typically longer than our core business. It takes anywhere between six to nine months for a deal to get sold. But now with Persistent’s reach I think Hoopz will be able to get more traction.”
Going ahead Deshpande said that the company will look at in-organic route to tap into new technology segments.