Purchase gives Zix formidable presence with AppRiver’s cadre of managed service providers
E-mail security vendor Zix Corp. on Tuesday doled out $275 million in cash for AppRiver LLC, a channel-first provider of cloud-based cybersecurity and productivity services with more than 60,000 customers and a reseller force of 4,500 MSPs.
The Lowdown: Dallas-based Zix is hoping to take advantage of AppRiver’s success with MSPs in cybersecurity and continuity, as well as its lead-generation chops through its Office365 offerings, to double the size of the company and get closer to SMB technology decision-makers who are key to cloud adoption, officials said.
Founded in 2002, AppRiver of Gulf Breeze, Fla., began as a spam and antivirus service vendor and has grown through acquisition and internal development into a popular provider of cloud-based Web protection, e-mail encryption, secure archiving, and e-mail continuity solutions.
The Details: The deal brings more than 4,500 engaged channel partners in the AppRiver Phenomenal Partner Program to Zix, which boasts around 400 VARs and MSPs in its 15-year-old reseller program.
Once the deal closes at the end of Q1, the combined company will have annual recurring revenue of $180 million. Company officials expect that figure to grow to more than $200 million by the end of 2019.
Background: AppRiver has been active on the M&A front over the past year. Last fall, the company bought New York-based Total Defense, a provider of subscription-based endpoint security for consumers and small businesses.
Last spring, the company bolstered its presence in Canada with the acquisition of Roaring Penguin, an Ottawa-based purveyor of e-mail security solutions.
The Buzz: “The acquisition helps us expand our customer base, enhance our advanced threat protection position, and accelerate our high-velocity go-to-market strategy through AppRiver’s numerous and longstanding channel partnerships,” said Zix CEO David Wagner. “It further accelerates our offerings into the cloud at the point of initial cloud application purchase.
“E-mail is typically the first application that gets moved to the cloud, and this acquisition puts us squarely at the beginning of our customers’ cloud migration,” Wagner added. “We look forward to capturing more mailboxes and additional services for years to come.”