Mailchimp Is Exploring a Sale at $10 Billion-Plus Valuation

(Bloomberg) -- Email marketing startup Mailchimp is exploring a sale that could value the company at more than $10 billion, according to people with knowledge of the matter.

Atlanta-based Mailchimp is considering options that could also include the sale of a minority stake, said the people, who asked not to be identified because they weren’t authorized to speak publicly. Mailchimp is attracting interest from private equity firms and large technology firms, the people said. The company had about $300 million in earnings before interest, taxes, depreciation and amortization in 2020, one of the people said.

No final decision has been made on pursuing a full or partial sale and Mailchimp could elect to remain independent, the people said.

A representative for Mailchimp didn’t respond to requests for comment.

The $10 billion figure may be a reasonable valuation depending on how fast the company is growing, according to Scott Berg, managing director of equity research at Needham & Co. Given the company’s Ebitda margins, estimates based on its reported $700 million revenue in 2019, and comparisons with other software companies, Mailchimp’s valuation range could be $7 billion to $11 billion, Berg said.

Mailchimp traces its origins to a web design agency called the Rocket Science Group, which was founded in 2001 by Ben Chestnut and Dan Kurzius. The company offers digital marketing services to small businesses, including social advertising, shoppable links and automation products.

In January, it acquired SMS marketing platform Chatitive Inc., which allows two-way personalized communication between businesses and their customers.

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