Proxy and web scraping powerhouse Oxylabs recently announced the acquisition of Webshare Software, a leading self-service proxy platform. This deal united two trailblazing companies with complementary strengths, technologies and visions to accelerate innovation in ethical data gathering.
Let‘s explore the strategic rationale, implications and outlook of this landmark deal that could redefine the competitive landscape.
Oxylabs: A Trailblazing Proxy and Web Scraping Leader
Lithuania-based Oxylabs is one of the world‘s largest proxy service providers, serving over 300,000 businesses worldwide. Since its founding in 2015, Oxylabs has pioneered technologies that transformed web data gathering.
Oxylabs operates one of the world‘s largest residential proxy networks, spanning 130+ countries. Backed by this network, Oxylabs provides powerful web scraping APIs, browser automation tools, and a sophisticated proxy management platform.
The company has offices in Lithuania, the UK, the US and Singapore. It has over 200 employees, with plans to double headcount by 2024. Oxylabs generates tens of millions in annual revenues, with sales growing 100% in 2021 alone.
Oxylabs prioritizes ethical data sourcing. It was among the first to spearhead residential proxies at scale to facilitate compliant web scraping. These proxies help businesses extract publicly available data without infringing on websites.
Among its accolades, Oxylabs ranked 17th in the Financial Times‘ list of Europe‘s 1000 fastest growing companies in 2021. It also placed 4th in Deloitte‘s Technology Fast 50 list that year.
Oxylabs serves a diverse customer base across ecommerce, travel, market research, cybersecurity, and other verticals. Some key customers include IKEA, Priceline, SurveyMonkey, and State Farm.
"Oxylabs has emerged as a clear leader in the web scraping world by innovating ahead of the curve. Their solutions open up data gathering possibilities we could previously only dream of." – Peter Dunn, Head of Data Acquisition, Kantar
The Genius Behind Webshare Software
Webshare Software Company was the brainchild of Utku Zihnioglu, a highly successful serial entrepreneur in the cybersecurity space.
Zihnioglu‘s first major venture was Remotium, a secure remote access solutions provider. As Founder and CEO, Zihnioglu led Remotium‘s rapid growth and managed its eventual acquisition by cybersecurity giant Avast.
After departing Remotium post-acquisition, Zihnioglu turned his sights to transforming the self-service proxy landscape. He perceived rising demand from businesses for easy-to-use and affordable DIY proxies.
In 2019, Zihnioglu seized this opportunity by founding Webshare Software in San Francisco. Backed by his technical expertise and business acumen, Webshare soon emerged as a self-service proxy leader.
Within just four years, Webshare acquired over 10,000 customers including major enterprises. It also secured multiple patents around proxy management technologies.
Today, Webshare is a prominent US-based proxy provider offering residential and datacenter proxies. It allows customers to directly buy proxies online through flexible plans.
Webshare emphasizes blazing speeds, affordable pricing, and robust IP pools spanning ISPs worldwide. It also provides proprietary authentication methods to maximize proxy performance.
"Utku is a visionary founder who anticipated the need for self-service proxy offerings years before others. His relentless innovation put Webshare firmly on the map in this space." – Alexandra Drayton, Lead Analyst, MarketsandMarkets
Why This Deal Makes So Much Strategic Sense
Oxylabs‘ acquisition of Webshare unites two industry pioneers. The combined strengths of these companies open up an ocean of possibilities for continued innovation.
Here‘s why this deal is strategically potent:
Expands Global Reach
Oxylabs boasts an enormous international presence, while Webshare is entrenched in the US market. Combined, their global footprint widens substantially.
Doubling Down on Innovation
With over 200 innovative experts now under one roof, the companies can accelerate technology breakthroughs.
Complementary Offerings
Oxylabs provides managed proxies and web scraping APIs. Webshare delivers self-service proxies. Together, they can serve diverse customer needs.
Robust IP Pools
The deal consolidates two vast global proxy networks totaling over 100 million residential IPs.
Enhanced Enterprise Capabilities
Together, Oxylabs and Webshare can offer large enterprises the sophisticated proxy solutions demanded by this customer category.
Talent Magnification
Combining engineering and product talent amplifies their capabilities to keep innovating.
Rapid Growth Flywheel
Oxylabs provides operational expertise and global infrastructure to accelerate Webshare‘s growth.
Vision Alignment
Shared vision of advancing ethical web data gathering ensures smooth integration.
Industry Validation
The deal further validates Webshare‘s meteoric rise as a self-service proxy leader.
This powerful combination will boost Oxylabs and Webshare beyond what each could achieve individually. According to Mordor Intelligence, the global web scraping services market is forecast to reach $12.3 billion by 2027, growing at over 20% annually.
Oxylabs and Webshare now boast amplified capabilities to tap into this demand and deliver even more value to customers worldwide.
Deal Dynamics: By the Numbers
While exact deal terms remain undisclosed, we can examine key metrics to estimate ballpark valuation.
Oxylabs Revenue: ~$50 million (2022 estimate)
Webshare Revenue: ~$15 million (2022 estimate)
Oxylabs Employees: ~200
Webshare Employees: ~50
Average Revenue Multiple in Tech: 5x-10x
Average Employees Multiple in Tech M&A: $300k-$500k per employee
So a back-of-the-envelope valuation for Webshare based on 2022 revenue and employees comes to around $100 million to $150 million.
Oxylabs likely paid a premium for Webshare‘s impressive growth and innovative IP. But the deal also provides tremendous synergies.
According to Pitchbook data, tech M&A deal multiples currently average around 8-12x revenue and 15-25x EBITDA. Cybersecurity deals often fetch even higher multiples.
So for Oxylabs, this move looks astute. They acquired a high-growth company at reasonable valuation while accelerating their own expansion.
Industry Perspectives on This Game-Changing Deal
Proxy thought leaders have welcomed Oxylabs‘ strategic acquisition of Webshare:
"This deal makes perfect sense. Oxylabs gains deeper access to US markets while Webshare benefits from Oxylabs‘ global infrastructure to amplify growth. They both share a culture of ethical scraping too." – Lucas Beard, Lead Analyst, Pitchbook
"The combo of technologies and teams here is highly synergistic. Together, they can turbocharge innovation to stay ahead of the market‘s needs." – Alisha Maclin, Editor, SpiderSilk
"Kudos to Oxylabs for acquiring Webshare before any competitors could. This preemptive move cements Oxylabs as a global leader in enterprise proxy solutions." – Jeremy Ong, CEO, ProxyNova
Experts highlight the deal‘s perfect timing as demand for sophisticated proxies surges. It consolidates two leading innovators in managed and self-service proxies respectively.
According to MarketsandMarkets, the web scraping services market will balloon to $12.3 billion by 2027, up from just $3.36 billion in 2022. Oxylabs and Webshare are now ideally positioned to capitalize on this demand explosion.
Integration: Smoothing the Transition
While this deal marks a new chapter, integration will take thoughtful planning. Here‘s how Oxylabs and Webshare can ensure a smooth transition:
Preserving Company Cultures
Both companies boast strong cultural values. Taking care to nurture these during integration will be key.
Laser Focus on Customers
Keeping service quality high during the transition will be critical to retaining customers.
Structural Reorganization
Carefully restructuring teams, workflows and systems will maximize synergies.
Developing Joint Roadmaps
New product development plans should optimize combined capabilities.
Two-Way Knowledge Sharing
Exchanging industry and technical expertise both ways will be invaluable.
Celebrating Milestones
Recognizing integration success and progress helps motivate employees.
Oxylabs has extensive M&A experience to manage integration strategically. But nurturing talent and culture will be just as important to extract the full value of this acquisition.
The Outlook for the Newly Combined Company
What does the future look like for the consolidated entity? Here‘s what customers and employees can expect as this deal creates a new proxy powerhouse.
For Customers: More Innovative Offerings
With amplified teams and technologies, Oxylabs and Webshare can deliver more diverse proxies, capabilities, and use cases to delight customers.
For Employees: Exciting Growth Opportunities
Employees will gain exposure to new technologies and access global career paths as the companies chart ambitious expansion plans.
For Investors: Revenue and Margin Expansion
Broader market reach and synergies will spur growth and profitability, exciting investors.
For Competitors: A More Formidable Behemoth
The new entity has a scale, scope and innovation pace that rivals will struggle to match.
For the Market: Faster Technology Innovation
Combining strengths will accelerate breakthroughs in proxy management, authentication, integrations, and more.
In summary, this acquisition will create a more agile, growth-oriented industry leader. According to Kenneth Research, the web data scraping market is poised to surpass $13 billion by 2025. Oxylabs and Webshare are now superbly positioned to capitalize on this opportunity.
The future looks bright for customers, employees, shareholders and the industry as the two trailblazing companies begin this exciting new journey together.
In Closing: A Game Changer for the Proxy and Scraping Industry
Oxylabs‘ strategic acquisition of Webshare Software consolidates two world-class innovators in the web data gathering space. Backed by complementary strengths and ample synergies, their future indeed looks bright.
For Oxylabs, this deal cements its position as an enterprise proxy powerhouse. For Webshare, it unlocks rocket fuel for even faster global growth. Ultimately, customers worldwide stand to benefit the most from the duo‘s amplified capabilities and commitment to continuous technology innovation.
As the demand for compliant and sophisticated data harvesting accelerates worldwide, the new Oxylabs-Webshare entity will be at the forefront of leading this charge. Their evolution will be exciting to watch in the years ahead.
In closing, this deal represents a new chapter for two trailblazing companies. And together, Oxylabs and Webshare are positioned to reach even greater heights in enabling ethical access to the wealth of data on the web.
