Sinch enters SMB market with $1.3 billon MessageMedia acquisition

Cloud communications company, Sinch,  is set to acquire mobile messaging firm, MessageMedia, for $1.3 billion, with a total cash consideration of USD 1.1 billion and 1,128,487 new shares in Sinch.

MessageMedia, which is aimed at the SMB market and has a growing footprint in the US, Australia, New Zealand and Europe, offers a web-based software-as-a-service (SaaS) suite that makes it easy to use two-way messaging without any need for coding or familiarity with APIs. It operates a highly automated and scalable tech platform that is purposefully tailored to meet the specific needs of small and medium-sized businesses. With a go-to-market motion built around digital customer acquisition and online self-service, the company serves over 60,000 customers and handles more than 5 billion mobile messages per year.

Organic growth is fuelled both by net expansion and new customer acquisition. Performance is particularly strong in the United States, where more than 1,500 new customers are added each month. Moreover, MessageMedia’s management team has a proven capability to drive consolidation and extract economies of scale with 9 successful acquisitions in its target market.

Sinch will look to accelerate these efforts, encourage international expansion, and task the MessageMedia management team to build a leading position in customer engagement for small and medium-sized businesses around the world.

MessageMedia focuses on products that can easily be deployed ‘out of the box’ without coding or API integrations. Third-party analysts estimate the total, worldwide addressable market (TAM) for such ‘Turnkey Consumer Engagement” solutions to USD 9-13 billion, of which the United States makes up around 30 percent. The total market is expected to grow by 25-30 percent per annum in 2020-24, with particularly strong growth in the United States. Small and medium-sized businesses make up around 50-70 percent of the market.

Addressing small and medium-sized businesses opens up a new avenue to growth and dramatically expands our addressable market. With MessageMedia as a part of Sinch, we will have the best team in the industry to capitalize on that opportunity.

Oscar Werner, CEO, Sinch