UPDATED 20:07 EDT / SEPTEMBER 03 2020

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Episerver acquires product development lifecycle startup Optimizely

Digital experience development company Episerver Inc. today said it has acquired product development lifecycle startup Optimizely Inc.

Although the price of the deal was not officially disclosed, Bloomberg, quoting people familiar with the deal, pegged the figure at less than $600 million, the valuation of Optimizely as of its last venture capital round in June 2019.

Founded in 2009, Optimizely assists businesses in testing different ways to make their websites or apps more effective. The company’s platform enables development teams to test proposed enhancements with a limited number of users, collect data on how well they respond and determine if the change is worth rolling out across the board.

In one example, a fashion retailer could experiment with different versions of its online catalog to see which one has the most positive effect on sales. Mobile developers can also use Optimizely to pilot updates with test groups before releasing them to all their users. The platform is said to lend itself to performing tests on the server-side components that supports a service, such as a product recommendation algorithm or a payment processing engine.

Optimizely had been going well for a long time but like many businesses was hurt by the COVID-19 pandemic. The company was forced to lay off 60 off its staff, or 15% of its overall headcount, in July. That might explain a possible acquisition price below its previous valuation.

Company clients include Gap, StubHub Inc. IBM Corp. and The Wall Street Journal.

The acquisition is being pitched as a win for Episerver by delivering the most advanced digital experience platform to optimize every customer touchpoint across the entire user journey. “The breakthrough combination of Episerver and Optimizely will transform digital experience creation and optimization, enabling digital teams to replace guesswork with evidence-based outcomes,” Alex Atzberger, chief executive officer of Episerver, said in a statement.

Optimizely has raised $252.1 million from firms including Goldman Sachs, Index Ventures, Andreessen Horowitz, Accenture, GV, Citi Ventures, Salesforce Ventures and others. Episerver was acquired by Insight Venture Partners for $1.16 billion in 2018.

Photo: Optimizely

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