Terms of both the deal and investment were not disclosed. This is Riverwood’s second investment in Sensor Tower, which received a $45 million funding round from the firm last May.
Sensor Tower provides customers with data-driven insights about the app economy, such as user number and retention of competitors in the market, said co-founder and CEO Alexey Malafeev. The acquisition of Santa Monica, California-based Pathmatics adds data around digital advertising, giving customers a fuller view of where their customers’ digital and mobile assets stand in the market.
“We saw the work they were doing in social and digital,” Malafeev said. “We saw a fit.”
Origin of the deal
Co-founder and CEO of Pathmatics Gabe Gottlieb — who is staying on at Sensor Tower as chief strategy officer — said while the companies had talked about potential partnerships in the past, acquisition discussions started about nine months ago after the COVID-19 pandemic. The pandemic accelerated both businesses as customers were looking for increased data and insights as they moved more digital.
“When COVID hit, we got nervous,” Gottlieb said. “But our usage skyrocketed 150 percent or 200 percent by our customers.”
Pathmatics was founded in 2010 and had raised about $8 million in funding to date, Gottlieb said. The company had about 50 employees, a couple hundred customers, and realized 50 percent growth in sales from 2019 to 2020, he added.
Sensor Tower has about 600 enterprise customers and 200 employees after the deal, Malafeev said. Founded in 2013, Sensor Tower had only received a $1 million seed financing before the Riverwood investment last year.
Malafeev said the company will continue to invest internally, adding to sales, marketing and customer support, as well as looking at emerging areas for analytics such as over-the-top or streaming services.
While San Francisco-based App Annie competes with the company on the mobile front, the deal for Pathmatics makes it a more complete offering that most cannot match, Malafeev added.
“Our models and our projections are very exciting,” he said. “I see a very strong independent company.”