MercuryGate acquired by Summit Partners, eyes future growth
The company has long enjoyed a reputation as one of the most well rounded TMS providers, with a varied customer base comprised of shippers, 3PLs, freight forwarders, freight brokers, and carriers.
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SaaS-based transportation management system (TMS) provider MercuryGate International Inc. was acquired by global growth equity investor Summit Partners, the companies announced this week.
Financial terms of the deal were not disclosed.
Established in 2000 by Monica Wooden, CEO, and Steve Blough, president, MercuryGate has seen significant growth over the years. In 2017, the MercuryGate TMS managed more than$70 billion of annual freight spend and supported more than 300 daily log-ins from 80 countries, according to company officials. The company has long enjoyed a reputation as one of the most well rounded TMS providers, with a varied customer base comprised of shippers, 3PLs, freight forwarders, freight brokers, and carriers.
MercuryGate said that CEO Wooden will take on a customer-facing role, serving as chief revenue officer, and president Blough will become chief product officer. Summit’s executive-in-residence Joe Juliano will become MercuryGate president and CEO and work with Wooden and Blough to “drive growth and scale initiatives,” MercuryGate said.
“We selected Summit Partners amongst many other suitors because Summit shares our vision and commitment to extend the foundation we have built into a platform for accelerated innovation, global ecosystem enablement, and customer scale,” said Wooden in a statement. “I was looking for an investment partner that had the growth-oriented strategic and operational resources to take us to the next level, and I found that formula in Summit Partners.”
In an interview, Karen Sage, chief marketing officer for MercuryGate, said that MercuryGate was indeed in a position to select Summit Partners from a variety of suitors.
“We selected Summit Partners, not because they were the highest bidder, but because we see unique benefits in a partnership with them,” she said. “Specifically, a Summit Partnership will bring MercuryGate to the next level of scale, making our customers even more successful and driving MercuryGate TMS to be a world leader in the industry.
“The acquisition represents the next chapter in MercuryGate’s journey. MercuryGate has been incredibly successful thus far. We have made the evolution from 0 to $60 million in 18 years. Now it is time to grow to three times that size or more in a fraction of the time.”
Sage added that Summit Partners clearly sees the great market potential in the transportation management system software market. She cited data from ARC advisors that estimate the TMS market in 2017 was $1.8 Billion in size and growing at over 10%.
"As more and more clients are looking at moving to the cloud, the opportunity to fill the existing and growing demand abounds,” she said.
Summit Partners mainly specializes in software, Sage said, noting Summit has been active in the software sector for more than three decades. And since the firm’s founding in 1984, Summit has partnered with more than 135 software companies in growth-oriented segments including enterprise, mobile, cloud and SaaS, big data and analytics, infrastructure and security.
As for how this deal benefits MercuryGate customers, Sage explained they will see positive changes through the acquisition by Summit Partners.
“Through the help of Summit Partners, MercuryGate will have the ability to bring even greater value to our clients,” she said. “With a stronger, larger, and more scalable organization and the best product architecture foundation on the market, we will be at the forefront of our ability to innovate and serve our customers’ needs. Summit Partners and MercuryGate both believe that with proper investment and scale, MercuryGate will be positioned for even faster growth than its current trajectory. This is a really exciting proposition and will cement MercuryGate’s leadership position in the market.”
Jeff Berman is Group News Editor for Logistics Management, Modern Materials Handling, and Supply Chain Management Review. Jeff works and lives in Cape Elizabeth, Maine, where he covers all aspects of the supply chain, logistics, freight transportation, and materials handling sectors on a daily basis. Contact Jeff Berman