Atlassian platform experts
January 10, 2025
by a searcher from INSEAD in Warsaw, Poland
I am looking at a target in the Atlassian ecosystem - plugin producer with a solid growth and EBITDA margin. I would appreciate an opportunity to chat to people experienced in platform play and/or Atlassian platform specifically. I would like to understand:
1. How to evaluate attractiveness of this target vs. stand-alone software,
2. How to think about platform risk/reward profile (e.g., platform costs and change of direction vs. wide audience etc.), and
3. Any other elements I should keep in mind when evaluating attractiveness of this deal vs. others in the pipeline
Many thanks.
Monika
from California State University, Northridge in Austin, TX, USA
I have to start by saying I have never looked at a plugin developer as a target so take my points with a grain of salt. I have used Atlassian products for a loooong time. In my mind there are two major threats in acquisition like this:
1. Plugins exist b/c either Atlassian does not have some functionality or what they have does not work for a subset of customers. So one concern would be Atlassian developing or improving functionality provided by plugin. In case the plugin provides missing functionality, sometimes Atlassian may not even need to release an awesome alternative. Just the fact that is core functionality will be enough for people to switch/start using Atlassian product. This is especially worrisome if the plugin is financially successful - Atlassian product teams always look for new revenue.
2. Concern #2... Anything that is not a core platform / functionality, can and likely will be replaced by agentic AI. So the question is whether you are able to build that or compete with that.
Again... just thoughts.
from University of California, Berkeley in Seattle Metropolitan Area, WA, USA
Similarly to any other deal - how comfortable you can get with the story - how long has it been around for, how has it evolved/been developed, who is supporting it, how are they getting customers / retention rates / growth rates / NDR/ any partners/vendors/channel relationships? Then you have to be comfortable with the platform itself and where that is going - that's likely the largest hurdle (other than the silly questions of 'why don't they build/develop that feature'), you still need to explain how it works and why it'll stick around to lenders or equity investors.
Depending on your technical capabilities - I'd ensure that you had some further diligence around that and how you'd address the next few years. Not sure where your multiple is and the level of comfort with price/timeline but with some growth and continued high margins, maybe you can get comfortable with a shorter timeline - lenders may not see it that way.