Middle market private equity firm HGGC has made an undisclosed investment in AutoAlert. The Presidio Group advised AutoAlert on the transaction. Based in Irvine, Calif., AutoAlert is a provider of data mining and portfolio management solutions to automotive dealers across North America.
PALO ALTO, Calif.—April 1, 2014—HGGC, a leading middle market private equity firm, today announced that it has completed a growth equity investment in AutoAlert, the leading provider of cloud-based data mining analytics and dealer portfolio management solutions to automotive retail dealerships throughout North America. As part of the transaction, AutoAlert founders Boyd Warner, CEO, and Jeff Cotton, COO, will reinvest a substantial portion of their proceeds and retain a significant minority stake in the business. Terms of the private transaction were not disclosed.
Headquartered in Irvine, California, AutoAlert pioneered the category in 2002 with its SaaS technology platform, and has built the largest network of customers in the segment by consistently delivering compelling ROI. The Company’s solutions generate high value leads from dealerships’ existing customer base, enabling AutoAlert customers to sell over 305,000 vehicles that totaled over $687 million in gross revenue in 2013. AutoAlert has recorded greater than 70 percent CAGR in net revenue from 2009 to 2013.
“For entrepreneurs like Jeff and me, the decision to accept institutional capital for the first time was not made lightly, and it was a step we would only take if we were sure that we had the right partner,” said Warner. “After meeting Steve Young and the HGGC team, it was clear that they not only believed in our vision for the company, but they also believed in the way we had grown the business and wanted to support us going forward.”
“In partnering with HGGC, AutoAlert gets so much more than financial resources,” added Cotton. “We get a team of professionals who truly understand our business, the enormous potential ahead of us, and the right strategy to achieve that success.”
“Boyd and Jeff have not just created a new product category, they have also demonstrated the ability to take this idea to market on a scale that is unprecedented for many solutions in this industry,” said Steve Young, Managing Partner and Co-founder of HGGC, who will become Chairman of the Board of AutoAlert. “We could not be more excited to start this next chapter with Boyd, Jeff and the AutoAlert team, as they just begin to demonstrate the power and value that ‘big data’ can bring to the automotive vertical.”
Rich Lawson, HGGC Managing Partner and CEO, and Jake Hodgman, Principal at HGGC, are also joining the Board of AutoAlert.
“We are impressed with AutoAlert’s market-leading solution and comprehensive support services, and the compelling value proposition the Company offers,” said Hodgman. “We share Boyd and Jeff’s vision for the future of the Company and are dedicaed to supporting continued development and delivery of best-in-class solutions to drive AutoAlert customers’ success.”
The Presidio Group acted as financial advisor to AutoAlert.
Based in Palo Alto, California, HGGC is a leading private equity firm focusing on leveraged buyout, recapitalizations and growth equity transactions in the middle market. The firm seeks to partner with strong management teams and founders to build companies capable of generating sustainable growth. With years of collective deal and operational experience, HGGC brings best practices from private equity and global corporations to help middle market businesses in a wide range of industries outperform the market. For more information, please visit www.hggc.com.
More than 2,700 automobile dealerships and about 50,000 individual users have benefited from added sales, profits, commissions and individualized support and training that come with each AutoAlert installation. Founded in 2002, AutoAlert, Inc. is the first and only company of its kind to offer dealership and enterprise wide business intelligence software, support and training. For more information, please visit: http://www.autoalert.com or follow @AutoAlertInc.