The Pointerra Ltd (ASX: 3DP) share price is up after the business announced an acquisition called Airovant.
What’s Airovant?
Airovant was formed in 2017 by four founders. This team came together after founding, scaling and exiting similar businesses in the high-growth US geospatial sector.
It provides data as a service (DaaS) to its customers through proprietary workflows using a cloud-based platform, delivering insight derived from subject matter expertise. It provides these DaaS customers with a digital representation of their worksite and assets through a proprietary cloud portal called AIROPORT.
Airovant’s subscription and other recurring data service agreements with customers “delivers actionable intelligence for decision making over the lifecycle of assets, facilities and construction sites”.
Airovant’s annual revenue has averaged US$1.4 million over 2018, 2019 and 2020 and the business has been both cashflow and earnings positive.
What’s the cost?
The total acquisition cost is US$1 million in Pointerra shares for the business assets and undertakings.
After settlement, Pointerra will enter into employment agreements with the four founder employees. These agreements will include the issue of up to 2 million ordinary shares each, vesting over a three year continuous employment period.
The rationale
Pointerra said that its US operation continues to drive growth in the company’s customer base and is well positioned to leverage the rapid adoption of 3D digital asset management technology across the key market sectors.
It also expects to benefit from investment in domestic infrastructure by US local, state and federal government agencies as part of the COVID-19 economic recovery and stimulus initiatives.
Pointerra is on the lookout for high quality individuals which can help growth. It said that since working with Airovant since the middle of 2020, it has become apparent that both organisations share a vision.
Summary thoughts
Getting the right people on board is very important for smaller businesses, particularly in the technology space. I can see why the Pointerra share price has risen in reaction to this.
Pointerra is certainly one to keep an eye on, though I’m not sure what the right entry point would be.
