Meltwater, originally recognized for its expertise in media monitoring and later venturing into business intelligence through AI and big data analytics, is securing a fresh investment. Verdane, a Norwegian private equity firm with a recently closed $1 billion+ fund for scaling tech companies, is acquiring an 11% stake in Meltwater. The company is valued at €542 million ($592 million), with the stake being valued at approximately $65 million. However, this transaction involves more than just this financial infusion.
Verdane’s investment is facilitated through a substantial stake acquisition in Fountain Venture, the investment entity controlled by Meltwater’s founder and current chairman, Jørn Lyseggen. Meltwater, previously a publicly traded company on the Norwegian stock exchange, went private earlier this year in a deal with private equity firms Altor and Marlin. Lyseggen retained his remaining share through Fountain. Verdane chose to invest in Fountain Venture instead of directly in Meltwater, aiming to collaborate on future investments in startups focused on AI and related fields.
Joakim Kjemperud, a principal at Verdane, highlighted that the deal also grants the firm a stake in an HR company, Jobylon, albeit Meltwater being the dominant asset. While Jobylon’s ARR is approximately €5 million, Meltwater, founded in Norway but now headquartered in San Francisco, boasts an ARR of around €500 million.
This transaction reflects key trends in the European tech and VC landscape. It underscores the pressure on tech company valuations, with Meltwater’s current market cap below its fundraising history. Additionally, it highlights the risk-mitigating approach of investors in a tight market, as private equity firms play a more significant role in deals amid a decline in VC funding.
In the evolving landscape of technology, companies like Meltwater face challenges and opportunities. Originally rooted in manually sifting through print media, Meltwater adapted to the digital age, incorporating AI and making strategic acquisitions. However, emerging technologies such as generative AI, exemplified by OpenAI’s ChatGPT, pose new competitive threats. Lyseggen remains optimistic, viewing these developments as opportunities for Meltwater to further invest in AI and maintain its position as a modern and AI-centric player in media analysis, processing approximately 1 billion documents daily for clients in communications, marketing, and PR.
