Cytiva, the Canadian talent acquisition technology company, is being acquired by Taleo.
The $11 million (Canadian; $11.1 million U.S.) deal is 
expected to close early next quarter. When complete, the purchase will bring Taleo some 250 mid- and small-market employers, strengthening that sector of the company’s business.
Based in Vancouver, British Columbia, Cytiva started in 1995 as a tech-sector job board, introducing its SonicRecruit ATS several years later. Over the years, Cytiva has added modules for onboarding, performance management, and others, retaining its focus on talent acquisition. All Cytiva software is true SaaS.
Michael Boese, Taleo’s SVP of its small- and mid-sized business group, said Cytiva is a good fit for Taleo, in part because both companies are focused on SaaS technology provisioning. And because Cytiva’s focus in the SMB market is where growth opportunities are strongest.
The announcement of the acquisition says it “solidifies Taleo’s leadership position in talent management for small and medium-sized businesses, and will extend Taleo’s customer base that will benefit from Taleo’s unified talent management platform.”
Cytiva customers were told of the acquisition and provided information detailing Taleo’s intention to continue supporting the Cytiva platform through the transition. Boese said he expects that by mid-2012, all the current Cytiva customers will make the transition to Taleo.
“Our intention is to honor the contracts,” Boese said, “and work with the customers to convert them to a Taleo customer. We have a history of making the conversion process work for the customer,” he added.
Cytiva has about 50 employees and four U.S. offices. He couldn’t say how many people would be hired by Taleo, but he noted the company is in an expansion mode — it acquired World Wide Compensation and Learn.com last year.
“We continue to look at scaling opportunities,” he said.
5 comments
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Martin Snyder Feb 1, 2011 at 7:24 pm
Alas Cytiva, we hardly knew ye.
“Seek to make your life long and its purpose in the service of your people. Prepare a noble death song for the day when you go over the great divide”
Chief Tecumseh, Shawnee Nation
Keith Halperin Feb 1, 2011 at 7:55 pm
Cytiva:
Sounds like something advertised on TV:
“Ask your doctor about Cytiva.
Do not take Cytiva if you are pregnant, wish to become pregnant, or have ever known anyone who is pregnant.
Side effects of Cytiva include:
death, painful death, extremely painful death, excruciatingly painful death, and dry mouth.
Cytiva: you’ll know when you need it”
……………………………….
The bells of hell go ting-a-ling-a-ling
For you but not for me,
And the little devils how they sing-a-ling-a-ling
For you but not for me.
O death, where is thy sting-a-ling-a-ling?
O grave, thy victoree? The bells of hell go ting-a-ling-a-ling
For you but not for me.
-British Soldier’s Song: WWI
Blake Carrington Feb 2, 2011 at 7:08 pm
If you look at Cytiva’s financials, this is an interesting (in the strange sense) move for Taleo. Cytiva has lost money every year for the last 6 years. It was insolvent by the end of Q3 of 2009. Accounts payable and short term debt was around $1.7 million, while cash and receivables was a mere $420K.
Given such a grim situation at the company, why would Taleo have paid 2X revenue for a product they’ll retire ASAP? I think they must be very desperate to grow market share to justify their stock price, and organic growth in this market is impossible. But this growth strategy can’t last forever. And it will dilute shareholders before it falls apart.
Ian Alexander Feb 7, 2011 at 1:45 pm
Hi Blake,
Cytiva had somewhere between $1-2M in receivables as of Q4 10, with a huge portion of its annual renewals coming in Q4 every year. That’s why Q3 always looks anywhere from tight to grim for the small company. And “lost money” is a bit of an ambiguous term when you see that Cytiva operated as largely cash flow positive or neutral in the last six years, albeit unprofitable on a recognized revenue basis.
Mike Avillion Feb 8, 2011 at 9:32 am
Blake,
Taleo has been doing this for years. I have experienced their acquisition and conversion process first hand. I was asked to participate in promoting their Business Edition product via webinar a couple years back, which I did. They do seem to constantly purchase small fish to gain market share. My ultimate experience with their product was disappointing and I shopped for a replacement product within 3 months of the changeover. In all fairness, this was about five years ago and they have hopefully ironed out the customer service issues that prompted me to implement an alternative ATS.