Popular perception would have us believe that Baltimore, fair city of Natty Boh drinkers and Ravens fans, is known only for its ability to serve as a mean backdrop for a former HBO series and a current Netflix show.
And in the startup world, certainly, Baltimore is not yet on the same playing field as New York City, Boston, Austin or Palo Alto. But there is success to be found here.
In what will be a recurring series of posts, Technically Baltimore presents a partial list of exits — by startups and companies based within Baltimore city or the Baltimore region — you ought to know.
To be clear, the focus here is on Baltimore technology firms that were purchased by larger companies, not other forms of exits, like Millennial Media going public and spinoffs like Videology, noted below. But what other exits should be included?
1. Bill Me Later
- Cofounded in 2000 by angel investor Vince Talbert, as well as Gary Marino, Mark Lavelle and Tom Keithley, the online credit startup was acquired by eBay in 2008 for about $820 million in cash and “about $125 million worth of outstanding options, net of option exercise proceeds.”
- Bill Me Later was then combined with PayPal, which eBay had already acquired at the time.
- Bill Me Later is headquartered in Timonium, with additional offices in Hunt Valley.
- Anyone who attended this past weekend’s Hack for Change hackathon (and many other tech events) is familiar with the online marketing startup that was acquired by AOL in in 2004 for $435 million in cash.
- John and Scott Ferber, cofounders of Advertising.com in the late 1990s, made about $70 million before taxes from the deal.
- Advertising.com is still based from Baltimore’s Tide Point.
- Since, the brothers Ferber have founded Videology, an online advertising platform, which changed its name from Tidal TV at the beginning of 2012.
3. Sylvan Learning Systems
- Douglas L. Becker and R. Christopher Hoehn-Saric purchased Sylvan from KinderCare Learning Centers Inc. in 1993, and renamed the company Sylvan Learning Systems Inc., which provided tutoring and testing services through nationwide centers for students in kindergarten through 12th grade. Sylvan Learning Systems was headquartered in Baltimore city.
- In the early aughts, a Sylvan subsidiary called Educate Inc. was purchased by the New York-based private equity firm Apollo Management LP in 2003 for $283 million and, after going public, in 2007, Educate Inc. was again purchased for $535 million by Sterling Partners, a private equity firm cofounded by Becker and based in Harbor East.
- Also in 2007, Laureate Education Inc., a spin-out from Sylvan focused on online college education, was acquired for $3.8 billion by a group of investors led by Becker.
4. Connections Education Inc.
- The online K-12 education company, profiled by the Baltimore Sun in 2011, was acquired by London-based Pearson for $400 million, reportedly in all cash.
- Connections is based in Harbor East, and has offices in Elkridge and Columbia.
5. Blue Sky Factory
- The email marketing firm founded by Greg Cangialosi in 2001 was acquired by Atlanta-based competitor WhatCounts in July 2011. In 2010, Blue Sky reported revenue of $4.8 million.
- Terms of the deal were undisclosed, although Blue Sky’s 27 employees at the time joined WhatCounts, with Cangialosi taking a position on WhatCounts’ board of directors.
- WhatCounts maintains Baltimore offices in the Brewer’s Hill neighborhood.
- Today Cangialosi is a cofounder of Federal Hill incubator Betamore, and he’s also one of the organizers of the Baltimore Angels investing group.
- The online learning management system, based in the city’s Sharp-Leadenhall neighborhood, was acquired by Blackboard in 2012.
- It was founded in 2005 by three cofounders, and the open-source program Moodle makes up the core of Moodlerooms’ software.
- Once a public company, Blackboard was acquired in 2011 by Providence Equity Partners for $1.6 billion, and so the terms of the Moodlerooms acquisition were not disclosed.
- What would become a dial-up and broadband ISP (in the earliest days of ISPs) began as Toad Computers in 1986 when Dave Troy and his cofounder were still in high school.
- Based from Severna Park, ToadNet was acquired by Continental VisiNet Broadband in 2004 for more than $2.6 million in an all-cash deal, according to reporting in 2005. But Troy, in an email Tuesday, said ToadNet was acquired for more than $4 million, including earn-out provisions.
- ToadNet, under new ownership, then formed a subsidiary, DataPoint data center (which has since renamed itself Expedient), and relocated to Tide Point (where Expedient still is today) from Severna Park.
- The software company was founded in 2001 by the present executive director of gb.tc, Jason Hardebeck.
- Its product, WhoWare, was a relationship management networking tool. WhoGlue was acquired by Facebook in 2011 for an undisclosed amount.
- That was two years after it sued Facebook for violating “a patent awarded to WhoGlue in 2007 for an ‘information management system’ to control personal information,” reported the Baltimore Business Journal at the time.
- According to the BBJ, Hardebeck “purchased back enough trademarks and WhoGlue’s software, WhoWare, to be able to service his current client base independent of Facebook,” and he also formed a new company, WhoGlue LLC.
For those wondering about Baltimore city neighborhoods mentioned: Technically Baltimore uses the Baltimore CityView map to identify addresses and neighborhoods.
Have suggestions for exits we should include in future posts? Comment below or email firstname.lastname@example.org.
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