Paylocity to Acquire Corporate Spend Startup Airbase for $325M

Paylocity is acquiring the corporate spend management startup Airbase for $325 million. This acquisition aims to enhance Paylocity's financial management solutions and expand its offerings in the corporate spend space. The deal reflects Paylocity's strategy to strengthen its market position and provide more comprehensive services to its clients, integrating Airbase’s innovative solutions into its portfolio.

HR and payroll software company Paylocity has announced its plan to acquire corporate spend startup Airbase for $325 million. The acquisition, pending regulatory approval, is expected to finalize within the next 30 to 60 days and will be financed through Paylocity’s revolving credit facility.

Airbase, founded by Thejo Kote in 2017, offers a platform for managing corporate spending, including bill payments and employee reimbursements. The San Francisco-based fintech raised over $100 million from investors like Menlo Ventures and Bain Capital and was valued at $600 million in 2021.

Paylocity, headquartered in Schaumburg, Illinois, with a market cap of nearly $9 billion and around 40,000 customers, aims to broaden its market reach by integrating Airbase’s solutions into its services. Kote stated that while Airbase had potential for growth, the opportunity to merge with Paylocity to create a comprehensive HCM and Finance platform was too significant to pass up.

The deal’s total value, including Airbase’s balance sheet cash, is estimated to be just under $400 million. Airbase, which has over 300 employees, has previously competed with companies like Ramp and Brex.

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Source: techcrunch‍