$100M+ acquisition of Dayforce in the works

On the heels of the Rypple acquisition announcement (see prior post “$65M for Rypple the latest good news for local VCs” Dec 15-11), the folks at Dayforce Workforce Management are about to trump last weeks’ news with their own takeover deal. Ceridian is the acquiror, I’m told, and the price tag will be “well over $100 million”. Earlier this year, Ceridian did a strategic investment round into Dayforce (size not disclosed).

There are two kinds of private co. M&A takeout deals in VC-land, and $100 million is the marker. Airborne, OZ, Pixstream, Radian6, etc. broke the $100M level. Those are the deals VCs and entrepreneurs alike always remember.

According to their bumpf: “Dayforce offers a complete workforce management solution that includes Time & Attendance, Labor Scheduling, Labor Forecasting, Labor Budgeting, Task Management and Employee Self-Service modules.” You’d think such things exist at all of the massive payroll shops, but that’s the beauty of the start-up software world: there’s always a problem to solve with the mainstream processors. Courtesy of the Atlanta Business Chronicle, Dayforce is the “reincarnation of Atlanta-based Workbits — created after Canadian serial entrepreneur David Ossip bought Workbits’ assets in May [2009]. Workbits founder John Orr approached Ossip after being unable to raise follow-on financing for his startup.”

Some members of the Dayforce team are ex-Workbrain fellows, just as with Rypple; good month for that DNA! End each tackled the HR space for their “next event”, even if from different angles. The name David Ossip will be familiar to the Bay Street crowd as the former CEO of Workbrain; the Dayforce exit will solidfy his reputation with another success story.

The VC name backing him will also sound familiar: Bridgescale came in in July 2010, as their first Canadian investment following the temporary merger with Edgestone Venture Partners (Edgestone was an original Workbrain investor). Bridgescale was also the “last money in” on Rypple, which makes for a pretty great month at their shop — mitigating much of the annoyance of the recent travails of their Carrier IQ investment. Other Dayforce institutional investors (if any) were not disclosed, but we can track a $15M Series A round led by Mr. Ossip in 2009, $10M from Bridgescale in 2010 plus another sum from Ceridian this year. That makes for a 2.5x perhaps for the Series B crowd?

Not to tempt the Celtic Gods, but best of luck to everyone involved as they get the deal over the finish line.

MRM