Banzai, a Seattle advertising and marketing software program startup, introduced Thursday that it’ll go public after it agreed to merge with a special-purpose acquisition firm. The corporate additionally stated that it’ll pay $110 million to accumulate advertising and marketing optimization startup Hyros after the SPAC deal closes.
Based in 2016 by former Avalara workers, Banzai initially began as an on-demand inside gross sales and advertising and marketing platform. It shifted to assist corporations drive registrations to occasions. Then it pivoted once more because the pandemic hit, specializing in its digital occasions advertising and marketing answer.
The startup, which has 94 workers, now describes its product as “an end-to-end video engagement answer that gives a quick, intuitive and highly effective platform of promoting instruments that create extra intent-driven movies, webinars, digital occasions, and different digital advertising and marketing campaigns.”
The SPAC is led by 7GC Holdings, headed up by Jack Leeney and CFO Christopher Walsh. 7GC Holdings is a three way partnership with Berlin-based Hennessy Capital, and its administration group was concerned in serving to Seattle firm Porch go public by way of SPAC.
“We discovered an amazing associate in 7GC Holdings group,” Banzai CEO and founder Joe Davy informed Startup. “We love their expertise on this area…they’ve been doing SPACs since earlier than it was cool, so we felt they’d be nice long-term companions.”
Particular function acquisition corporations (SPACs) re-emerged in an enormous manner in the course of the pandemic’s low rate of interest setting, as capital flowed to newly shaped entities and entrepreneurs used SPACs to extra rapidly enter the general public markets.
However the efficiency of post-merger SPACs has steadily dropped, significantly since January amid the bigger market downturn. Greater than 55 SPAC transactions have been referred to as off this 12 months and the normal IPO market has additionally softened. 7GC was set to take Vice Media public in August 2021, however the two events reportedly scrapped these plans.
Seattle companies together with Porch, Nautilus Biotechnology, Rover and Leafly have all gone public by way of SPAC throughout the final two years. However these corporations, which differ broadly of their respective industries, have seen their inventory value drop by no less than 50% from all-time highs.
Following the merger between Banzai and 7GC, the mixed firm can have a post-deal enterprise worth of $380 million. The corporate raised an extra $100 million by means of an fairness facility from GEM.
The mixed firm will probably be referred to as Banzai Worldwide and can commerce on the Nasdaq Capital Market.
“We would like Banzai to be in one of the best place within the coming years,” Davy stated. “This can put extra cash on our steadiness sheet. It would additionally put us in a greater place to purchase nice corporations when the chance arises.”
An investor presentation for the deal reveals that Banzai posted a web lack of $8.5 million, for the 12 months ended Sept. 30, 2022, with annual recurring income of $22.1 million. The startup serves greater than 7,200 clients in 28 nations.
Banzai didn’t disclose how a lot complete funding it has raised up to now. The corporate stated it raised a complete of $21.2 million when it raised $15 million in enterprise debt financing in March 2021.
Banzai competes with London-based digital occasions startup Hopin, which raised $400 million final 12 months in a deal valued at $7.75 billion. Different opponents embrace San Francisco-based Hubilo, which raised $125 million final 12 months.