Since its founding more than two decades ago, software company Vocus has been a sign of hope for Maryland’s tech scene.
Vocus was an early provider of do-it-yourself public-relations software for small businesses — its flagship Internet product, PRWeb, automatically dispatches news releases to reporters, for instance.
The company grew from a two-person operation, fueled by a $32,000 loan from one of the founder’s fathers, to a 1,500-employee company taking in $187 million in revenue in 2013, making it one of the region’s 100 largest public companies. Vocus’s sprawling office in Beltsville, reminiscent of Google’s or Apple’s campuses, was inspired by a seaside resort in Florida, providing its more than 700 local employees with spas, juice bars, free candy and retail shops, among other perks.
That trajectory has now taken a sudden turn.
In April, Vocus agreed to be acquired by Chicago-based private equity firm GTCR for $446.5 million. Last week, employees began to learn what the deal will mean.
A GTCR affiliate, GTCR Canyon Holdings, announced its plan to combine Vocus with a public-relations software competitor, Cision. GTCR had gained control of the Stockholm-based company in April after a takeover battle with Norwegian public-relations software firm Meltwater.
As part of the marriage, Vocus’s chief executive, Rick Rudman — who co-founded the company in 1992 — is to be succeeded by Cision’s chief executive, Peter Granat, and will not longer be involved with the company.
In an interview, Granat said the new Vocus will integrate the customers and software capabilities each company has. PRWeb has a strong geographic presence in France, the United States and the United Kingdom, he said, while Cision’s counterpart, CisionPoint, is well-represented in the United States, Canada, the United Kingdom, Germany and Portugal.
Granat declined to offer more granular details because the companies are still waiting for GTCR’s acquisition of Cision to officially close.
“It’s too early to comment on what the integration will look like,” he said.
For now, Vocus plans to maintain its office and employees in Beltsville and globally, and Cision, which is still a publicly listed company in Sweden, will operate as usual, he said.
Vocus made its mark as an early player in the online PR market, but it struggled to keep pace with the changes in the industry as social media outlets such as Twitter and Facebook became prominent and people gravitated to smartphones and tablets.
After his departure, Rudman said the new company will need to be agile to succeed.
When “we started in 1992, we were still in the era where people were moving from paper news-clippings and directories of reporters to online databases and electronic news monitoring,” he said. “The one constant in technology is change.”
Granat agreed. The ubiquity of social media creates new requirements for public-relations software, he said.
“In the past, PR professionals have worked mainly with traditional media. Now, communicators and marketers are telling their stories for brands directly to their stakeholders through their own publishing and content marketing tools,” he said.
The company plans to further develop features that would allow users to monitor social media for mentions of their businesses, and to access the software from mobile devices, Granat said.
Before it agreed to be acquired, Vocus had been on its own acquisition spree — in 2011, it bought Engine 140, a Twitter-based marketing software and branding company, for a sum that wasn’t disclosed. In 2012, it bought iContact, a provider of e-mail-based marketing software, for $169 million.
It struggled to digest some of the acquisitions. In 2013, the company reported a loss of $21.8 million, and its net loss for the fourth quarter was $3.9 million, compared with $3.7 million for the same period in 2012.
Rudman, who officially resigned from Vocus in May, is looking for his next project. Though he doesn’t know what that will be, he said, “my only rule is I’m not ruling anything out.”
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