Veritone acquires AI hiring company PandoLogic
Veritone, the creator of an AI operating system, announced it signed a definitive agreement to acquire PandoLogic.
The acquisition is a total consideration of $150 million on a cash and debt-free basis, payable in Veritone cash and stock, with performance earn outs through fiscal 2022. This values the transaction at approximately three times PandoLogic's expected 2021 GAAP revenues.
It is expected to be immediately accretive, with PandoLogic generating over $50 million in SaaS and related GAAP revenues and over $25 million of EBITDA on a pro forma 2021 basis.
PandoLogic uses AI to accelerate and enhance hiring processes for employers hiring at scale, for both mass-market and difficult-to-source candidates. It uses predictive algorithms, machine learning, and AI.
Having worked with many Fortune 100 focused on reestablishing workforces through job recovery, PandoLogic is credited with helping hire a large portion of the essential workforce, and as a result, experienced rapid growth. The company was also recently honoured as the best Human Capital Management Solution by the SIIA CODiE Awards and the Ventana Research Digital Innovation Awards.
“This transformative acquisition builds on the strength of our organic growth, expands our addressable market with a new diversified revenue stream, and unlocks new growth and development opportunities as we integrate the platforms,” says Veritone chairman and CEO, Chad Steelberg.
“The combination of our companies extends the reach of leading AI, human capital software and SaaS solutions to the world's largest multinational employers requiring more efficient and scalable hiring.
“We believe the added financial scale, leverage, and market expansion into talent acquisition will enable us to accelerate further adoption and utilisation of our AI. Both companies have been leaders in their respective markets, including PandoLogic's marquee leading multinational clients and Fortune 100 companies,” he says.
PandoLogic CEO, Terrance Baker, says they are looking forward to becoming a part of the Veritone family with their shared vision for AI and strong cultural alignment.
“In combination with Veritone, we will both be able to utilise our cognitive engines to help customers create even deeper insight and efficiencies in their hiring practices and beyond.
The total $150 million acquisition of PandoLogic consists of upfront payments of $50 million in cash and $35 million in Veritone stock. The remaining 43%, or $65 million in cash and stock, is payable based on earn outs tied to financial performance in fiscal 2021 and 2022.
Under the terms of the agreement, Veritone will issue stock consideration valued up to $56.7 million, or 2.8 million shares of Veritone common stock, which are subject to certain trading and registration restrictions.