Paylocity To Acquire Airbase for $325M: A Strategic Move to Expand its Market Reach
In a groundbreaking deal, HR and payroll software giant Paylocity has agreed to acquire corporate spend startup Airbase for $325 million. This acquisition, subject to regulatory approval, is set to close in the next 30 to 60 days, marking a significant step for both companies.
Airbase, founded by Thejo Kote in 2017, offers a comprehensive platform for mid-sized companies to manage their spending efficiently. With features like bill payments, corporate cards, and employee reimbursements, Airbase has carved a niche for itself in the fintech space.
The San Francisco-based company had garnered over $100 million in equity funding and was valued at $600 million in 2021. On the other hand, Paylocity, with a current market capitalization of nearly $9 billion, sees this acquisition as a strategic move to expand its reach beyond human capital management (HCM) into the office of the CFO.
The decision to merge with Airbase wasn't easy, as Kote mentioned, but the synergies between the two companies are undeniable. By leveraging Paylocity's resources, Airbase aims to create a unified platform for mid-market companies, tapping into a larger audience.
The deal, estimated to be worth around $400 million when including all assets, is a testament to the potential that Airbase holds. With just over 300 employees, the future of Airbase under Paylocity's umbrella remains uncertain, but the possibilities are endless.
Overall, this acquisition signifies a strategic move in the fintech space, with implications for investors, employees, and customers alike. As the market evolves, collaborations like these will shape the future of financial technology, offering new opportunities and growth potential for all stakeholders involved.