MindShift Acquired by Best Buy as Retailer Expands IT Services
Best Buy is looking to a local IT services firm to spruce up its business, announcing today that it is acquiring Waltham, MA-based MindShift Technologies for $167 million. The deal gives Best Buy (NYSE: BBY) more power behind its services offering as the company faces competition in its retail operation from online sources like Amazon.
MindShift, founded in 1999, is the leading managed service provider for small and mid sized businesses in the U.S. (an estimated $40 billion market, according to Best Buy). It offers cloud, data center, and other IT services to businesses for a monthly fee and has more than 5,400 business customers.
The acquisition by Best Buy resembles the retailer’s 2002 acquisition of Geek Squad, the provider of computer repair and maintenance services. MindShift will keep its company name, management team, and 500 employees spread across Massachusetts, New York, Minneapolis, North Carolina, Philadelphia, and Washington, D.C., according to today’s release.
“There’s no question that acquiring the skills, capabilities and clients of mindSHIFT has the potential to help expand Best Buy’s global services capabilities in the vast small and mid-sized business market,” said George Sherman, senior vice president of Best Buy Services, said in the announcement. “As important, the mindSHIFT team will bring added experience, talent and resources to the remote support capability we have been building within our multi-channel tech service unit Geek Squad.”
MindShift most recently raised $18 million in venture funding and has the backing of investors such as TD Fund, Volition Capital, and Columbia Capital. The acquisition is expected to close around the end of the calendar year, subject to customary closing conditions.