Last month I had a fascinating and highly entertaining lunch with Barry Houlihan, founder of Mobile Interactive Group, which was yesterday sold for a potential $59m to American mobile marketing giant and NASDAQ-listed Velti Plc.
Houlihan had just been named the Golden Gun at Growing Business’ annual Young Guns awards. In 2006, we had identified him as an entrepreneur well worth watching and even suggested that as he carried a notebook everywhere it would be worthwhile peeking over his shoulder. At the time Mobile Interactive Group was a fledgling but undoubtedly impressive business. Houlihan was earthy and honest and impossibly positive. A year later, the company took the Innovative Business award at Growing Business’ Fast Growth Business Awards.
So Houlihan was an obvious choice for the Golden Gun award, sponsored by Farrer & Co, which recognises the achievements of one of our Young Guns alumni. Mobile Interactive Group’s turnover had risen at the rate of knots to £100m-plus, with excellent profits. Sitting in a restaurant on the corner of Lincoln’s Inn Fields, London, Houlihan told us – two partners from Farrer & Co were our hosts – that an exit could come at any time and that he’d always been honest with staff about it. “I’m not anticipating it yet, but won’t rule it out,” he said. Houlihan (pictured above receiving his Golden Gun award) admitted that in the past he had turned down very serious bids for the business.
Not for a minute did we suspect that the business sale was, in fact, imminent and presumably already well underway. It’s an owner’s prerogative to keep such manoeuvres under his or her hat, especially with a journalist present. Nevertheless, I suspected that were it to happen in the near future it would effectively be the end of the line for him at the company he founded, whether he remained for an earn-out or not. Time will, of course, tell.
It appears for now that Houlihan will remain with Mobile Interactive Group as part of the global management team of Velti. In total, Velti will pay a minimum consideration of $25m, including $20m of cash at closing. An additional $34m will be paid between now and 2013, on the basis of a 7.5 times adjusted EBITDA multiple, based on 2011 and 2012 performance. Velti described the huge potential the $16bn mobile marketing sector offers, suggesting it will inflate to $30bn in the next few years. Houlihan himself is looking forward to the economies of scale and innovation being part of Velti can bring.