How Beeline’s new majority investment can accelerate growth

How Beeline’s new majority investment can accelerate growth (Courtesy of First Coast Innovation) — As temporary workers become a bigger part of large company workforces, a private equity firm has bought a Jacksonville company whose software manages such workers, setting the stage for more growth.

Greenwich, Connecticut-based Stone Point Capital has become the majority owner of Beeline, with the company’s previous majority owner, New Mountain Capital, becoming a minority investor.

While Beeline did not disclose the size of the investment, Stone Point Capital’s website says the firm “generally target[s] equity investments of between $75 million and $750 million.”

New Mountain Capital is “a great partner … but the reality is we find ourselves [with] a deep desire to accelerate our endeavors,” Beeline CEO Doug Leeby said, adding that at a certain point with a private equity relationship, the focus turns from investment to profitability.

“They were super amenable to helping us find another partner,” he added.

The investment will allow the company to take advantage of a crucial moment for the vendor management software industry as contingent workforces take up an increasingly large share of the workforce of large companies, Leeby said. While that trend was picking up speed in the years preceding the pandemic, Leeby said Covid-19 and the resulting labor shortage and minor recession forced businesses to accelerate it.

For help and expertise doing so, many of those companies turned to the Beeline, leading to a 25% growth in its customer base.

Stone Point’s investment will allow Beeline to accelerate its effort to modernize its platform — primarily in microservices on the cloud — since some of its functionality is based on older technology, Leeby said.

It will also set the stage for acquisitions. Potential targets include companies providing services such as tools for background checks and onboarding, with Leeby saying he’s especially interested in enhancing the convergence between full-time employees and non-full-time employees.

Beeline’s annual revenue was between $150 million and $200 million, Leeby added, with 650 employees, 225 of whom are in Jacksonville.

Beeline has “a pretty solid leadership position in the world,” Leeby said, competing with Chicago-based SAP Fieldglass — another cloud-based vendor management system — with over including 30% of Fortune 500 companies using Beeline’s products.

Image courtesy of PR Newswire