Industry Insights

ESW Capital Sold Off Jive's Social Marketing Platform to Lithium

Last May, here at CMS-Connected, we analyzed the private equity firm ESW Capital’s acquisition of Jive Software, an enterprise communication and collaboration solutions provider, for $462 million. While concluding that article, I asked whether ESW Capital would use the acquisition as a cash cow or invest in the platform to provide the superior end-to-end employee and customer experience, as Jives’s CEO promised. Shortly after that acquisition, this week, ESW Capital banished our doubts on that matter as it sold off one of Jive’s two core products, Jive-x social marketing, to San Francisco-based Lithium Technologies. Financial details of the deal were not disclosed.

Hot on the heels of the acquisition, we reached out to Dayle Hall, SVP and head of marketing at Lithium Technologies to inquire what attracted them to Jive as an acquisition opportunity. “Lithium is building out its capabilities to become the clear leader in digital customer experience. That means continuing to build Community into a full engagement platform as well as covering all digital touchpoints across social media management (SMM). The tight integration of SMM to help manage community is a key differentiator for us, which is now boosted by the additional capabilities acquired from Jive-x,” said Hall to CMS-Connected. Once asked what Jive will bring to Lithium, he applauded the vendor’s platform and its customer base: “It’s a blend of product and customers. Jive has really strong product features like groups and event management, as well as tight partner integrations and APIs. They have also been successful developing into highly regulated industries. They also have over 250 of the best brands in the world.”

Lastly, we asked how this acquisition is going to address the trends or challenges of the current Lithium customers, and here’s what Dayle Hall had to say: “Our customers are some of the world’s most sophisticated brands, and they’re always looking to do more with our platform. With the addition of Jive, we’ll have access to the best community features and platforms on the market and we will continue to build capabilities and integrate with SMM to help brands deliver amazing digital customer experiences.”

How Did Jive Get Here?

Founded in 2001 in Iowa by Bill Lynch and Matt Tucker, Jive Software, saw an unprecedented growth which encouraged the bigger players to enter the market. As a result, the pressure on Jive had gotten bigger and bigger because of the high focus on the enterprise collaboration software space by other longtime players like Microsoft, Cisco, Salesforce, Facebook, and IBM. In recognition of this cut-throat battle with both newer products and huge enterprise software providers, Jive’s stakeholders began looking for a successful exit and that’s how the vendor got involved in the M&A talks in 2015. Over time SAP, Oracle, Workday, IBM and many other big tech players had become the subject of those talks before the collaboration software provider was acquired by Aurea which owns a company that operates several different enterprise software businesses under its umbrella to "optimize the end-to-end customer journey across a diverse range of industries." This acquisition ended the era of being an independent social software vendor who has a leg-up against the tech titans like Microsoft, which now offer similar capabilities embedded to their platforms.

On a side note, Jive’s significant growth has also been recognized by important industry analyst reports in the fourth quarter as well. Forrester, for instance, named Jive as a Leader in The Forrester Wave, Enterprise Collaboration Q4 2016 report. Jive received the highest possible score for innovation in market approach thanks to its enhancements to Jive’s Collaboration Hub in 2016. The report cited that Jive has evolved from a destination to a hub for access to corporate knowledge.

Where Does this Leave Jive?

Once the fastest-rising star in the Portland tech community and one of the biggest enterprise software success stories, the company has seen two acquisitions in the past four months. As a result of the first acquisition, Jive became a part of the Aurea family of companies. With this second acquisition, however, the Jive-x social marketing business has been sold while the Jive-n intranet platform persists to be operated under the umbrella of Aurea and ESW. Considering the idea behind the first deal was combining Aurea’s strength in customer engagement and Jive’s strength in employee engagement to deliver the superior end-to-end employee and customer experience, shedding Jive’s social marketing platform is not such a bizarre move. Jive's best-known product, Jive-n, is considered a good match with Aurea as Jive’s deep expertise in employee collaboration complements Aurea’s deep understanding of customer experience management.

Scott Brighton, CEO of Aurea, reassured Jive’s customers stating: "We believe all Jive customers will benefit from this transaction through increased focus on their distinct needs.  Jive-x customers will enjoy Lithium's exclusive focus on external communities, while Jive-n customers will benefit as we intensify focus on serving as the gateway to an enterprise's most important assets – its knowledge and people,"

On the other hand, Rob Tarkoff, president and CEO of Lithium contended: “Bringing Jive-x into the Lithium portfolio will give these customers access to our cumulative knowledge and the best innovation of both products, delivering significant business value for all.” He also ensured Jive’s customers that they would make sure continuity of service for all Jive-x customers during the transition period, and moving forward, he pledged that all customers would benefit from their continued investment in the community product category and from access to integrated social media management capabilities over time.

Lithium has been working with some of the world’s biggest brands including Airbnb, AT&T, Best Buy, and Sephora. The vendor has a massive digital footprint with approximately 480 million new digital interactions analyzed daily, 100 million monthly visitors across its Online Communities, and 850 million online profiles scored through Klout, a social media ranking platform that Lithium bought back in 2014.

Jive-X Out, DNN In

This week, on one hand, ESW Capital was shedding Jive, on the other hand, it was busy bringing a breath of fresh air by acquiring DNN Software, enterprise content management system provider. The investment firm made it clear that they would further invest in the CMS platform as well as the DNN open source ecosystem. "We are incredibly proud of having served both customers and community for over a decade. We are glad to see ESW’s commitment to building on the foundation we have laid," said Navin Nagiah, the outgoing CEO of DNN Corp. As part of the acquisition, Andy Tryba is joining DNN as a new CEO. Hot on the heels of the acquisition and this organizational change, CMS-Connected reached out to DNN to get an inside scoop on what these all means for the future of DNN. To binge on our reporter Laura Myers' exclusive interview with the new CEO, Andy Tryba, do not forget to check back to our website on Wednesday, 6th of September. 

Venus Tamturk

Venus Tamturk

Venus is the Media Reporter for CMS-Connected, with one of her tasks to write thorough articles by creating the most up-to-date and engaging content using B2B digital marketing. She enjoys increasing brand equity and conversion through the strategic use of social media channels and integrated media marketing plans.

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