18 Jan Leading software localization platform Phrase acquired by Memsource backed by the Carlyle Group
Memsource, the leading AI-powered translation management system, together with its majority shareholder The Carlyle Group (NASDAQ: CG), today announced that it has acquired Phrase, a leading software localization platform.
The transaction highlights Technology Return´s M&A experience in successfully advising technology-driven founders and companies: with this deal in the thriving SaaS industry.
It underlines our value proposition to realise selected, valuable M&A transactions with superior strategic partners.
Headquartered in Hamburg, Germany, the Phrase platform provides cloud-based localization for software, websites, and mobile applications. The platform enables customers of all sizes to scale their translation processes through advanced automation, eliminating unnecessary steps from the localization process. Through its unique value proposition, Phrase has built up a wide-reaching customer base across multiple industries, from Lufthansa Systems GmbH to Pizza Hut Digital Ventures.
Headquartered in Prague, Czech Republic, Memsource is a leading translation technology provider that assists global corporations and the language services industry in automating the localization of large volumes of multilingual content. The company is a leader in AI-powered translation technology, which makes localization easier, faster, and more cost-effective. Memsource translation software is used by leaders in their respective industries, such as Uber, Zendesk, Supercell, and Vistaprint.
The combination of Phrase and Memsource creates the industry’s leading translation management company, significantly expanding the product portfolio, geographic footprint, and customer base. As part of the group, Phrase will be able to offer many new value propositions and benefits to existing and future customers. The combined group will seek to transform the localization industry, providing global brands with a streamlined solution that reduces costs, increases translation quality, and automates the localization process end-to-end.
The founders of Phrase – Wolfram Graetz, Tobias Schwab, and Frederik Vollert – will become shareholders of the Memsource group. David Canek, the CEO of Memsource, will become the group CEO with immediate effect.
David Canek, Founder and CEO of Memsource, said: “Since Carlyle’s investment in Memsource in July 2020, we have focused on growing the business organically while exploring compelling acquisition opportunities. Phrase is a leading software localization platform bootstrapped by an incredibly talented team. As leaders in their respective fields, (enterprise TMS and software localization respectively), Memsource and Phrase are determined to create the next generation of translation automation for the full range of enterprise localization use cases.”
Wolfram Grätz, Founder of Phrase, said: “Having established ourselves as a pioneer in software localization, partnering with Memsource and Carlyle is the next logical step for the company. We have a cross-industry customer base from the automotive to the financial sector and many of them are asking us about our plans to support additional localization use cases. We have continuously addressed their needs, and by combining our high-quality management teams and deep software expertise, we intend to create a market innovator with the vision, talent and scale to define the future of enterprise translation management.”
Fernando Chueca, a Managing Director in the Carlyle Europe Technology Partners (CETP) advisory team, said: “CETP IV invested in Memsource to accelerate the next phase of the company’s development, including a focus on expansion into new geographies and innovative technologies. The transaction with Phrase, the first since Carlyle’s investment, is testament to this strategy, providing an attractive entry point to the German market and access to its highly complementary product suite and established customer base. The enlarged group is uniquely positioned to establish itself as a leader in translation management systems, enabling sophisticated software localization across international markets.”
Technology Return M&A Advisory and CMS Legal Services acted as advisor to the founders and sole owners of Phrase in this transaction.
Phrase is a cloud-based software localization platform that accelerates the development of multilingual digital products. Phrase enables organizations of all sizes to scale and centralize their translation processes through advanced automation and a broad variety of integrations. Founded in 2012 in the heart of Hamburg, Phrase has grown from a small start-up into an agile, ambitious team from around the world. Phrase is growing rapidly and currently partners with over a thousand businesses in over 60 countries. Further information is available at phrase.com.
Memsource helps global companies translate efficiently. Ranked as the most viable Translation Management System by CSA Research in 2019, Memsource supports 500+ languages, 50+ file types, and 30+ machine translation engines. Memsource enables its customers to increase translation quality while reducing costs using its patented, state-of-the-art AI technology. With a team of over 120 people in offices across Europe, the US, and Japan, Memsource serves thousands of global customers, including leading brands such as Uber, Zendesk, Supercell, and Vistaprint. Further information is available at memsource.com.
About The Carlyle Group
The Carlyle Group (NASDAQ: CG) is a global investment firm with deep industry expertise that deploys private capital across three business segments: Global Private Equity, Global Credit, and Investment Solutions. With $230 billion of assets under management as of September 30, 2020, Carlyle’s purpose is to invest wisely and create value on behalf of its investors, portfolio companies, and the communities in which we live and invest. Carlyle employs more than 1,800 people in 30 offices across six continents. Further information is available at carlyle.com. Follow Carlyle on Twitter @OneCarlyle.
About Technology Return
Technology Return is a mid-cap corporate finance, M&A and investment advisory boutique, advising entrepreneurs, investors and SMEs on M&A mandates exclusively in the digital and technology industry. The company has formerly closed notable transactions in the areas of artificial intelligence and machine learning, e-commerce, SaaS, platform industry, digital marketing and social media. Further information is available at www.technology-return.com
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