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Brisbane-headquartered deployment automation company Octopus Deploy has spread its tentacles deeper into the US market with the acquisition of California-based rival Codefresh, which is built on top of the open-source Argo project and specialises in the continuous integration/deployment (CI/CD) of software.
The company has not disclosed the value of the transaction but media outlets the Australian Financial Review and Startup Daily report the deal is worth US$28 million ($42.6 million) - a price that would indicate a significant devaluation due to the tech bubble burst in recent years as Codefresh raised almost that same amount, US$27 million, in a Series C in mid-2020.
Meanwhile, Crunchbase estimates that Codefresh had a post-money valuation of US$50-100 million in March 2021.
Octopus Deploy, which is used by the likes of Nike, Domino's and Coca-Cola among its 3,700-plus customers, received a US$172.5 million minority stake investment almost three years ago from Insight Partners, and in 2022 bought Sydney-based software container company Dist.
The Brisbane company, founded by husband-and-wife team Sonia and Paul Stovell, already has a presence in the US market, as well as in the UK and New Zealand. It claims the Codefresh acquisition creates one of the largest privately held companies in the DevOps ecosystem, focused on best-of-breed CD.
The acquisition will lift the combined group's employee numbers by around 35 per cent to more than 270, increase its customer base by an extra 300, and lift annual revenue by around a fifth to US$60 million.
Octopus Deploy reports that it has a history of being profitable and remains so, with a level of sustainable and profitable growth that is "unmatched" by any other private CI/CD vendor.
"Octopus is thrilled to welcome Codefresh into the team," says Paul Stovell, co-founder and CEO.
"We're adding Codefresh's considerable technology to empower software teams to deploy freely. It represents a big investment in open source and the Argo project that Codefresh maintains and scales with its enterprise offering."
Codefresh is a trusted platform for enterprises running Argo and scaling and deploying to Kubernetes, an open-source system for automating the deployment of applications.
"We are eager to bring the power of Codefresh's Continuous Integration and cloud-native GitOps – based on Argo – to Octopus Deploy," says Raziel Tabib, the Codefresh CEO who co-founded the company in 2014 with Oleg Verhovsky.
"With Codefresh and Octopus, we will elevate the capabilities available to software teams and drive innovation in Continuous Delivery."
Dan Garfield, Codefresh's chief open source officer came on as a co-founder in 2016.
"We're thrilled to find a home in Octopus, where they believe in the community we've helped build around Argo and GitOps," he says.
"We're going to be able to invest even more in open source and continue to grow Argo and other open-source initiatives with our community partners."
Octopus Deploy is the second UQ Ventures alumnus to make a major announcement today, after listed- hearing-tech company Audeara (ASX: AUA) struck a breakthrough contract with percussion drum manufacturer Avedis Zildjian.
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