Allurent, Previously Reported Closed, Finds New Life at Jenzabar
This is a startup survival story for the books. Allurent, which the tech media reported as defunct last month, has gotten new life through an acquisition by Boston-based Jenzabar, a maker of higher education enterprise software. What’s more, Allurent, which develops interactive widgets for enhancing e-commerce storefronts, never stopped doing business, says Jenzabar CEO Robert Maginn. The acquisition was first reported by Dow Jones VentureWire today.
Jenzabar and Allurent have been connected long before this deal, in which Jenzabar will own 100 percent of Allurent and will invest a “seven-figure sum” in Allurent over the next 12 months, according to Maginn. The exact dollar value of the deal was not disclosed. Allurent was founded in 2005 by a group of veterans from Art Technology Group (NASDAQ: ARTG), the e-commerce software maker that sold to Oracle (NASDAQ: ORCL) late last year for $1 billion. Maginn was an investor in ATG and Allurent, which raised about $14 million, through his investing vehicle New Media Investors.
“The only mistake they really made was not anticipating that the economy was going to come crashing down,” says Maginn of Allurent, which had shrunk in recent years and saw an acquisition deal fall through in the fall of 2010, leading to the reports of its demise. ”I was surprised when the deal they were set to do in September and October abruptly fell apart. We had to take a step back and think about the Allurent business and potential applications to our business.” Jenzabar started putting together a deal with Allurent late last year, and even hired on some of the staffers to work on Jenzabar, he says.
Through the deal, Allurent will become a wholly owned subsidiary of Jenzabar, which makes software that powers and supports “every office you can think of on campus,” from admissions to billing to financial aid, Maginn says. The technology also powers online courses and e-commerce sites for selling university paraphernalia. Allurent’s products will help make the e-commerce applications with Jenzabar more interactive, and Jenzabar vice president Chris Hartigan will act as general manager of Allurent. Meanwhile, Allurent will continue to run the same business with the customers it had (and never lost, contrary to reports of the company shutting down), Maginn says. The acquisition deal went through in December, he says.
“My goal is to basically first and foremost continue the Allurent business on the same track it was on,” he says. He plans to hire virtually all of the former Allurent staffers or equivalent positions who were on at the time that the acquisition deal for the company fell through, around third and fourth quarter of last year. Allurent employees (Maginn didn’t specify how many) will move from their Cambridge office—which also houses Polaris Venture Partners’ Dogpatch Labs—to Jenzabar’s space in Boston’s Back Bay, says Maginn. Allurent employees could also get more involved with the Jenzabar technology and products over time, he says.
Maginn didn’t say much about the failed acquisition of Allurent last year, other than that it was a household name that ultimately backed out of buying the company. Jenzabar was also able to hire back nearly all of the top executives at Allurent, with the exception of CEO Graeme Grant, who took a job late last year as chief operating officer at Belmont, MA-based CQuotient, a Bain Capital Ventures-funded e-commerce startup that’s just starting to make some noise.
The new Allurent/Jenzabar operation will also try to stay tight with Allurent and ATG founder Joe Chung, who’s working on a new venture called Redstar, out to spot startup trends and turn them into companies. “I think it will be complementary,” Maginn says.