Hooli’s CEO Gavin Belson announced today that the tech giant has reached an agreement to acquire the middle-out compression startup Endframe. The sale closed at $250 million, and Endframe’s team will take the place of Hooli’s recently-dissolved Nucleus project. While many speculated Hooli was removing itself from the middle-out space, Belson’s motives in dissolving Nucleus now appear to have been well calculated as he scoops up the hottest middle-out compression play on the market.
Endframe has been dominating the middle-out compression space, with recent deals totaling over $30 million and serving clients such as Intersite Content LLC and energy-drink company Homicide. Through its revolutionary compression algorithm, the platform provides access to files at a drastically reduced size. Their compression algorithm made news earlier this year with its impressive Weissman score in the low fives, and Endframe founder and CEO Marc Howard has stated they expect to improve their Weissman score in the near future.
At the time of purchase, Endframe boasts a robust startup staff of 60 employees. Hooli has not disclosed who from Endframe’s sales and development teams will stay on through the acquisition, but Belson has stated they look forward to retaining the “incomparable minds and talent” of Endframe’s core engineering team. Howard has stated Endframe “looks forward to integrating with Hooli’s innovative and world-changing technology that truly makes the world a better place.”
This acquisition marks a win for Hooli, who previously lost its lawsuit against middle-out startup Pied Piper. The lawsuit alleged that Pied Piper’s middle-out technology was developed at Hooli and therefore owned by the large company – and not the small startup. A binding arbitration award concluded Pied Piper did in fact own the IP, and since the win, Pied Piper closed its Series A funding with Raviga. Pied Piper CEO Jack “Action Jack” Barker has said the company has “great potential” and is “poised for excellence;” however, the company has failed to make any product announcements since their remarkable presentation at TechCrunch Disrupt. The once-hot startup appears to be faltering as competitors like Endframe take ownership of the space.