elemental_hq.jpg
Elemental's headquarters on Southwest Broadway in downtown Portland.
(Mike Rogoway/The Oregonian)
This is a breaking news story. Look here for complete coverage of the deal.
Elemental Technologies, the biggest of a new generation of young Portland tech companies, sold its business Thursday to Amazon Web Services.
The companies didn't report terms of the deal. A source close to the transaction put the sale price between $300 million and $500 million. That makes it the highest price paid for a young Oregon technology company since Electronic Data Systems Corp. paid $460 million for Portland-based Saber Corp. in 2007.
The deal's scale is a milestone for Portland tech, which had long struggled to grow technology businesses. Elemental was at the forefront of a new generation of software-oriented businesses founded around the start of the Great Recession, and who thrived despite the economic upheaval.
Privately held Elemental had raised $44.1 million in investment and reported revenue of about $50 million last year. The company has more than 200 employees, most of them in downtown Portland.
Elemental said it will keep its headquarters in Portland and chief executive Sam Blackman, who co-founded the company in 2006 while an engineer at Pixelworks, will continue to run the company.
Founded nine years ago in Portland, Elemental said it will continue to operate under its existing brand. The companies plan to close the deal by the end of the year.
Elemental makes video encoding technologies, which broadcasters including the BBC, Comcast, ESPN and HBO use to prepare their programming for transmission online.
Its revenues have grown by roughly 50 percent annually over the past few years as demand for online video has surged.
"The media and entertainment industry is at a unique inflection point, and as a part of Amazon, we will be in an even stronger position to help our customers delight their viewers globally," Blackman said in a written statement.
Initially focused on consumer technology, Elemental adapted quickly when it became clear there was a larger, corporate market for its software.
"There is no question that Sam has just done an exceptional job," said Diane Fraiman, a partner with Voyager Capital, which was an early investor in the business. "He has just been a very thoughtful and agile CEO and the results are there."
Amazon Web Services is a distinct branch of Seattle-based Amazon.com. AWS hosts other companies' data in its server farms, including a growing complex in Morrow County. In July, AWS paid an undisclosed amount for a Portland startup called AppThwack, which enables mobile app developers to test their software on a variety of devices.
Elemental's sale is the latest in a rapid series of deals for Oregon-based businesses, including Standard Insurance Co., Precision Castparts, Dave's Killer Bread, Planar Systems and Little Big Burger.
The deals are fueled by the cash large corporations stockpiled during the recession, a strong U.S. economy, and the fact that Oregon businesses are relatively small and therefore affordable as bigger organizations seek to extend their brand and market position.
In Elemental's case, the deal also reflects the explosive growth of cloud computing and the huge popularity of online video enabled by the Portland company's technology.
This article has been updated with additional detail and commentary on the deal.
-- Mike Rogoway
mrogoway@oregonian.com
503-294-7699
@rogoway
If you purchase a product or register for an account through a link on our site, we may receive compensation. By using this site, you consent to our User Agreement and agree that your clicks, interactions, and personal information may be collected, recorded, and/or stored by us and social media and other third-party partners in accordance with our Privacy Policy.
RetroSearch is an open source project built by @garambo | Open a GitHub Issue
Search and Browse the WWW like it's 1997 | Search results from DuckDuckGo
HTML:
3.2
| Encoding:
UTF-8
| Version:
0.7.4