Germany-based Cumulocity, a pioneer brand in the industrial IoT space, has emerged from its long-time stewardship by business software and data analytics firm Software AG, including through its latter supervision by US private equity outfit Silver Lake, as an independent entity after a management buyout that puts its original founders back in charge. The deal for Cumulocity, whose IoT management platform is white-labelled by a number of mobile operators, among others, is funded by Avedon Capital Partners, Schroders Capital, and Verso Capital.
The news follows the break up of Software AG’s remaining businesses at the start of the year with its Adabas & Natural and ARIS units spun-off as standalone operations within a newly formed Software GmbH parent company, and Alfabet and Cumulocity sold to unnamed parties. It now emerges Cumulocity’s original founders, Bernd Gross and Stefan Vaillant, plus others, secured funding from European-based venture firms to cast-off again under their own steam.
Early January, the new Software GmbH business confirmed also the departure of Sanjay Brahmawar as group chief executive, who joined Software AG in 2018/19 to captain its total business transformation – which led to its sale to Silver Lake for $2.6 billion in late 2023, and the subsequent divestments of its StreamSets, webMethods, and TrendMiner businesses last year. StreamSets and webMethods were sold to IBM for €2.13 billion ($2.3 billion) in July.
TrendMiner was sold to a German industrial analytics provider Proemion the same month. Schroders Capital, part of the management buyout of Cumulocity, had been close to agreeing a deal for Software AG in 2023, before Silver Lake swooped. Silver Lake had invested €344 million in Software AG back in 2021. Silver Lake retains control of Software GmbH, and its standalone Adabas & Natural and ARIS businesses. “This change is part of the group’s strategy,” it said.
Gross and Valiant are joined on the management team at the newly-independent Cumulocity (note, its moniker appears to have been shortened from Cumulocity IoT, as it was in the old Software AG stable) by Jürgen Krämer, Jari Salminen, and Philip Hooker. The company has “ambitious global expansion plans”, said a statement. Gross commented: “We are very excited to enter this new phase of independence, with renewed momentum and a strengthened structure. Our new corporate setup enables us to be more agile and adapt to the changing needs of our customers.”
He went on: “The dynamic industrial IoT market, where we have already demonstrated our credentials, will provide the right environment for Cumulocity to thrive in its next chapter. The long-term partnership with our investors will enable us to deliver value to our customers and partners, while creating an attractive workplace for our talented people. We are pleased to have been a part of Software AG, and we are now looking forward to forging our own path forward.”
The company has gone from a startup to a scale-up in Software AG’s hands, effectively. Its IoT platform, utilised by “hundreds of companies across diverse industries”, is ranked as a leader in both the Gartner Magic Quadrant for Global Industrial IoT Platforms and the Forrester Wave for Industrial IoT. The company serves customers in 30-odd further countries, including the US (one of its “largest and most competitive growth markets”).
Meanwhile, Silver Lake has appointed senior executives Martin Biegel, Martin Clemm, Robin Colman, and Toktam Khatibzadeh to lead Software GmbH.
On departing, Brahmawar said: “It has been a privilege to lead such a well-respected company through many significant moments in its recent history, and to have worked with such a talented and committed team of professionals.”
Christian Lucas, managing partner at Silver Lake, thanked Brahmawar, and added: “We are excited to invest in both ARIS and Adabas & Natural and their world class products, and support their multi-year growth acceleration plans as independent companies.”
