AuditBoard Acquisition: Key Details, Impact, and What Comes Next

Hg's acquisition of AuditBoard for over $3 billion marks a significant move in the software and services industry. This strategic partnership aims to bolster AuditBoard's growth, enhance its innovative technology, and expand its global reach. The deal underscores the increasing importance of connected risk platforms in managing audit, risk, compliance, and ESG for large enterprises.

What Is AuditBoard?

Founded in 2014, AuditBoard offers cloud-based software solutions for audit, compliance, risk management, IT security, and ESG management. Its core products include SOXHUB, RiskOversight, OpsAudit, CrossComply, TPRM, ESG, and ITRM. AuditBoard's platform is distinguished by its intelligent, collaborative, and connected risk management capabilities. Trusted by over 50% of Fortune 500 companies, it delivers significant efficiency gains and is highly rated for user experience, time savings, and ease of collaboration.

Who Acquired AuditBoard?

Hg is a leading investor in European and transatlantic software and services businesses. With over 30 years of experience, Hg focuses on building enduring leaders in these sectors by advancing digitization trends and transforming workplaces. The company provides specialist operational support and access to a network of talent and knowledge, accelerating the progress of proven businesses. Recognized for their significant industry influence, Hg's expertise is evident through their strategic partnerships and investments.

When Was AuditBoard Acquired?

Hg acquired AuditBoard on May 23, 2024. This acquisition occurred during a period of significant growth for AuditBoard, which had recently reached $200 million in annual recurring revenue. The timing aligns with industry trends emphasizing the importance of connected risk platforms and innovative technologies in audit, risk, compliance, and ESG management. The acquisition reflects the increasing demand for comprehensive risk management solutions and the strategic value of capital-efficient growth strategies in the software and services sector.

Why Was AuditBoard Acquired?

• Market Expansion: The acquisition by Hg is expected to fuel further growth and global reach for AuditBoard. With Hg's strong European heritage and presence across North America, AuditBoard can accelerate its international expansion and penetrate new markets. Serving over 2,000 enterprises, including nearly 50% of the Fortune 500, AuditBoard is well-positioned to leverage Hg's resources for continued market expansion.
• Technology Integration: AuditBoard's innovative technology, including the recently announced AuditBoard AI, is a key factor in its success. The acquisition will enable continued investment in product innovation and the development of new capabilities. Hg's support will help integrate advanced technologies into AuditBoard's offerings, enhancing its connected risk platform and maintaining its competitive edge.
• Competitive Advantage: The acquisition strengthens AuditBoard's position against competitors by providing additional expertise, capital, and global partners. AuditBoard's customer-centric approach, SaaS-native beginnings, and differentiated tech stack are key competitive advantages. Hg's backing validates AuditBoard's strategic direction and enhances its ability to deliver customer value and innovation, solidifying its market leadership.

Acquisition Terms

• Acquisition Price: Over $3 billion
• Payment Method: The specific payment method was not publicly disclosed.
• Key Conditions or Agreements:
  • AuditBoard will remain an independent company.
  • No need for customers to re-sign paperwork or change payment arrangements.
  • No plans to change the company’s name.
  • Hg will support AuditBoard’s product innovation, international growth, and customer success.
  • Goldman Sachs & Co. LLC served as the exclusive financial advisor to AuditBoard.
  • Cooley LLP served as legal counsel to AuditBoard.

Impact on AuditBoard

The acquisition by Hg is expected to bring significant changes to AuditBoard's operations and management. While AuditBoard will remain an independent company, the partnership with Hg will fuel further growth, focusing on product innovation, international expansion, and customer success. Scott Arnold, CEO of AuditBoard, emphasized the importance of maintaining the company's foundation and culture while scaling the business. The acquisition is seen as a validation of AuditBoard's practitioner-first focus, with plans to continue building and expanding the platform with Hg's support.

Regarding product offerings and services, the acquisition will enable continued investment in AuditBoard's innovative technology, including the recently announced AuditBoard AI. Hg's backing will support the development of new capabilities and enhance the connected risk platform, ensuring AuditBoard maintains its competitive edge. Employee reactions have been positive, with key figures expressing gratitude for the support of colleagues, partners, and investors. Customers are reassured that there will be no immediate changes to service or support, and the acquisition is framed as a positive development that will enhance their experience.

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