Per the terms of the deal as described in the report — which cites several sources with knowledge of the deal — a new, joint company would be created under the name and branding of 1776. 1776-developed communications platform, UNION, would be spun off into a separate company run by 1776 CEO Evan Burfield.
There’s one problem, though: Burfield denies such a deal is happening.
“We’re always exploring different ways we can expand 1776’s mission, but there is no imminent acquisition of 1776,” Burfield told the D.C. publication.
Meanwhile, in Philly, one source with knowledge of the deal tells Technical.ly it’s not an acquisition but a merger of the two companies.
We reached out to Benjamin’s Desk co-CEO Anthony Maher. The exec declined to comment on the report.
“Yes, we’re having talks with 1776, just like we’ve had them for the past two years, but they’re around how to help entrepreneurs and things like the Challenge Cup,” Maher said. He invited “reporters making wild allegations” to come to Philly on Oct. 10 where he, co-CEO Jennifer Maher and 1776’s Burfield will be “on stage” ready to answer questions from anyone.
— Anthony Maher (@AnthonyMaher12) May 3, 2017
Let’s look back at the course Benjamin’s Desk has been charting from Philly, and a few reasons why a deal like this would kinda make sense:
- The two companies have been flirting with each other for a while now. The zenith of that relationship happened last May, when the two companies announced the “Benjamin’s Desk Challenge Center (powered by 1776),” at the time dubbed a “strategic alliance” to connect companies in the local ecosystem with members of the UNION platform.
- A month prior to the deal, Benjamin’s Desk was announced as one of 20 partner companies backing the UNION platform. Twenty-five Philly companies and 10 local mentors had been onboarded to the Philadelphia chapter. There was no money exchanged in the deal, Maher then said.
- BD’s is on a growth spurt: all told, the coworking spot has eight locations either open or in the works. Some, like its Center City hubs are fully run and operated by the BD camp. Others, like their upcoming Ambler Yards location and Wilmington’s 1313 Innovation, are under a licensing model and use the “Powered by Benjamin’s Desk” moniker.
- If you’ve ever heard the former soccer pro speak at an event, likely you’ve heard Maher stump for the Northeast Corridor. A D.C.-presence would mean the company’s first foray outside the greater Philly region.
On the other hand, would a deal as described by the WBJ make sense for Benjamin’s Desk, a bootstrapped company? (Wayne Kimmel’s SeventySix Capital invested $150,000 in 2013, but the equity was bought back by the company the following year.)
Unlike we just saw with the Ticketleap acquisition, there’s not a contingent of investors looking to see returns. For them, losing the BD brand (as described in the WBJ report) may mean a trade-off for the ability to expand further in the region.
Looking across the negotiating table, 1776 raised a $7.2 million round last year from backers like Steve Case’s firm, Revolution.
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