Today cloud-based event management company Cvent announced that it has acquired Seed Labs, a startup that specializes in mobile apps for consumer and social events including concerts, festivals and sporting events, for $4.2 million. Founded in 2009, Seed Labs created 82 mobile apps for 38 events in 2012 alone, including the Kentucky Derby. Their apps have been downloaded over two million times. The acquisition will help Cvent, which launched in 1999 and has over 950 employees globally, add to their mobile solutions for event planners, and pivot to more consumer-focused offerings, rather than their current enterprise-level solutions.
This is Cvent’s first acquisition, and it follows $136 million in private equity financing in July 2011, which the Wall Street Journal called one of the largest investments in an unlisted software companies last year. CEO Reggie Aggarwal said that Seed Labs’ team, including founders Todd Rogers and Rick Solner, will remain in Austin, TX, and that the companies will eventually be integrated, but in the interim Cvent will add to the team to help them scale. Aggarwal said that while Cvent had some mobile offerings, Seed Labs’ focus on native apps for iPhone, iPad, Android and BlackBerry is well beyond anything they could have developed in-house. “The reason we bought them was because we thought they were the leader in consumer-facing events for mobile, and we hadn’t developed tools that I thought were where we needed to be,” Aggarwal said in an interview.
He said an acquisition made sense over building apps internally or partnering with a third party because they wanted expertise in-house. “We would never be able to build something like this as quickly because they’re experts,” he said. And while Aggarwal said they spoke with over 20 companies in the mobile event app space, they settled on Seed Labs because of the founders’ passion for events, and their experience building native apps over the past three years. “The founders are two guys who had a big passion for consumer events. The first apps they built they did for free, just to get free tickets and VIP passes. You can’t replace the passion you get by finding people who are that excited by that space.”
Cvent has had a tumultuous history, raising $17 million in 2000 and growing their team from six to 126 people, only to slash that to 25 people after the dotcom crash. The company slowly rebuilt itself though, and now has over 10,000 customers, including 30 of the Fortune 100. The company’s main product is a cloud-based SaaS event management platform, but they also help event planners source venues, run surveys, and connect with vendors and suppliers.
Seed Labs’ focus on consumer events should help Cvent branch out from being the “Eventbrite for B2B,” as Aggarwal described their event management platform. They’ve built apps for ESPN’s X Games, the Country Music Association’s CMA Music Festival, and several other high-profile events. Their apps include features for attendees including real-time stores, photos, background information, and practical information like schedules and floor plans. Aggarwal said they plan to help event organizers extend their brand deeper by offering consumer-facing apps.
The meeting planning industry is worth over $100 billion in the U.S. alone, and while Cvent has created a booming business around B2B event planning, it makes sense that they’d make the foray into consumer-focused apps as an add-on to their enterprise-level offerings. They’ll have to compete with other mobile app developers, as well as consumer-facing event products like Eventbrite and Meetup, but Aggarwal is confident in their focus on mobile. “Our belief is that mobile is the future for events,” Aggarwal said. “We are making a pivot so that we’re also going to be getting more into consumer-facing events, and this is our first foray into consumer, and we’re going via mobile.”