Mphasis acquires Blink Interactive for $94 million
Mphasis, a business process management firm, acquired Blink Interactive for $94 million, including earnouts, on Wednesday.
Blink reported revenue of $29 million in 2020, and has grown at a compounded rate of 42 percent between 2017 and 2020. A bulk of its revenue comes from research and design of hardware and software services or products.
“This acquisition aligns with our strategy to be a trusted partner to our clients in the digital transformation journey," said Nitin Rakesh, CEO and Executive Director of Mphasis, in an investor call on Wednesday.
"The acquisition helps significantly expand our total addressable market (or TAM), while shifting left to the forefront of customer experience, in alignment with our Front2Back transformation model,” he added.
Mphasis' Front2Back (F2B) approach is focused on harnessing cloud and cognitive to provide hyper-personalised digital experiences to clients and end customers. (The 'front' in F2B transformation reflects the client-centric approach.)
Seattle-headquartered Blink Interactive has conducted UX research studies, and been involved in the development of evidence-driven products and services, including Amazon Alexa, Microsoft Xbox, and the Starbucks mobile app.
Its client base includes technology firms such as Microsoft, Amazon, Google and Facebook among others with tenure of around 10 years. Blink uses user research sessions, combined with quantitative statistical and survey work.
“We work with tech; we also work with traditional companies whose industries are being transformed by technology, but what all of our clients have in common is a desire to increase their impact through better products, smarter technology and a relentless focus on the user experience,” said Kelly Franznick, Chief Innovation Officer & Co-founder, Blink Interactive, in the investor call.
Mphasis clocked revenue of Rs 9855.3 crore ($1.3 billion) in financial year 2020-21, growing 9.2 percent over the previous year.
The acquisition closed on September 21 after Mphasis signed a definitive agreement in nature for the merger plan. "Apart from expanding our TAM within our existing clients and second, Blink takes the company into a segment of customers that the company has not worked with," Nitin Rakesh told analysts, in the investor call.
Blink works by addressing the strategy, research and design needs of its clients. The company expects significant uplift from the acquired company to its BFSI (banking, financial services, and insurance) and hi-tech verticals, and significant growth potential by leveraging their strategic account model to Blink’s marquee client base.
With Blink, Mphasis will shift and engage with clients in their digital journey – in a way moving upstream by addressing the strategy, research and design needs of clients. Mphasis' previous use-cases in the upstream phase have been more consultative in nature revolving around strategy, marketing, customer management, and employee management.
This acquired upstream capabilities will give Blink scope to participate in larger, full stack, digital transformation-based constructs using Mphasis’s teams and account-mining methodologies, Rakesh explained.