July 2, 2021 – 11:10 AMT
PanARMENIAN.Net – ServiceTitan, a software provider for tradespeople, co-founded by Armenian immigrants Vahe Kuzoyan and Ara Mahdessian, is acquiring Aspire Software, a software provider specifically for commercial landscapers. Along with that, the company is announcing another $200 million in funding, a Series G that values that company at $9.5 billion, TechCrunch reports.
Los Angeles-based ServiceTitan is not disclosing the financial terms of the deal, but it comes on the heels of the company raising $500 million only in March (when it was valued at $8.3 billion) — money that it earmarked at the time for acquisitions.
Used by over 100,000 contractors to manage their work, ServiceTitan also confirmed that this is its biggest acquisition yet, which roughly puts this deal in the hundreds of millions of dollars. Aspire will stay based in Missouri to build out the company further from there.
Aspire itself has some 50,000 users and sees $4 billion in annualized transactions on its platform across areas like landscaping, snow and ice management, and construction. It has never disclosed a valuation, nor how much money it has raised. The St Louis, MO company was previously backed by growth equity firm Mainsail Partners.
The deal underscores not just how much scale and opportunity remains in building technology to serve the home services space, but also what might be a consolidating trend within that, where a smaller number of companies are building technology for contractors and others in the space working across a number of adjacent and related verticals.
ServiceTitan is already bringing in annual recurring revenues of $250 million — a figure it shared in March and hasn’t updated — and as of that month, it had grown 50% over the preceding year. Part of that growth is based on simply more usage of and demand for its software, but part of it also has to do with the company expanding what it covers.
ServiceTitan got its start in residential plumbing, HVAC and electrical — the areas where the the two founders Ara Mahdessian (CEO) and Vahe Kuzoyan (president) went first because they knew them best from their own family businesses — but expanded into areas like garage door, chimney and other areas, as well as commercial property, on its own steam.
In other markets like landscaping or pest control, the expertise is more specialized, however, so it makes sense to make acquisitions in those areas to bring in that software, and teams to manage and build it, to further diversify the company. (ServicePro, a pest control company, was acquired in February.)
ServiceTitan, the biggest of the software players now, is likely going to continue making more deals to grow its own empire, but it added that it will also be using the funding to expand more organically, with investments into customer service, R&D, and to hire more people across the board.