According to multiple reports, Boeing announced today it had entered an agreement to sell “significant parts” of its Digital Aviation Solutions (DAS) business unit to private equity firm Thoma Bravo, self-described as, “a leading private equity investment firm building on a 40-plus-year history of providing capital and strategic support to experienced management teams and growing software and technology companies.”
What an insult it was to have Boeing appropriate Jeppesen and ForeFlight in the first place. The customer seldom benefits from acquisitions of well functioning relatively small companies, be they grocery stores, banks, or air navigation publications by arrogant, musclebound, dysfunctional behemoths,
Not a great promotion for laissez-faire capitalism. Foreflight definitely would have been better off if they had never met an M&A lawyer. And this is another step down the stairs to mediocrity.
Private equity acquisition. We’ve seen what they do to retail and restaurants, let’s find out what they do in aviation where prices are already unsustainably high.
Raf, I certainly understand the trepidation giving the behavior of other PEFs. Dan Millican at Taking Off did a bit of a deep dive on this.
Throma Bravo is a buy and built not a buy and dismantle PEF, according to Dan’s research, so there is hope. Fourflight is a good sized international company with presents just about everywhere, so I don’t see it being dismantled.
Yes, Throma Bravo is not an aviation company, but they bought one, bringing all the institutional knowledge along with it. So hey are now.
Price hikes? Maybe, maybe not. Wait and see.
I, for one, will continue to use Fourflight regaradless.
Not always. Those are just the ones hear about. You never hear about PEFs that don’t destroy companies.
Throma Bravo apears to be one of those when viewing their acusitions and what they do with them.
Take a look at FlyQ. I switched after my Garmin Pilot turned off mid-flight over the New Mexico desert with a message that my subscription had just expired!
Kevin, I agree. Some PEFs have earned their reputation for squeezing profits and moving on, but Thoma Bravo seems to be a different story. Like Dan Millican pointed out, they’ve got more of a build-it-up than tear-it-down track record.
They’ve picked up Jeppesen, ForeFlight, AerData, and OzRunways, the same pieces Boeing tried to bring together but never really fused. From what I can gather, Jeppesen might be bringing in around $700 million a year, ForeFlight somewhere near $170 million, AerData maybe $100 million, and OzRunways a small slice at roughly $5 million. These are just rough estimates pulled from industry noise and what little info is out there.
Even so, that adds up to close to a billion dollars in annual revenue. Not just numbers, but recurring income from tools that pilots, operators, and dispatchers actually use and trust.
It could go somewhere, if they keep it together, focus on integration, and don’t start burning bridges with price hikes.
Sign of things to come: Foreflight just ended our university instructor/student discount program after a ten plus year relationship. It’s a small thing, but probably a harbinger of future predatory revenue strategies… It’s time for a disruptor to launch a comparable product.