Jeff Pelline's Sierra Foothills Report

Editor’s note: Here’s the press release of Telestream’s acquisition by Thoma Bravo. This deal marks the second buyout of one of our area’s major and pioneering digital video firms by a San Francisco-based private investment firm in just over a year. Last year, Grass Valley Group was acquired by Francisco Partners:

NEVADA CITY, Calif. and SAN FRANCISCO, Dec. 21, 2011 /PRNewswire/ — Telestream, the leading provider of video transcoding and digital media software solutions, today announced that leading private equity investment firm Thoma Bravo, LLC has entered into a definitive agreement to purchase Telestream, Inc. The transaction will facilitate further growth of Telestream’s core businesses in addition to providing additional capital for further market expansion and acquisition.

“This acquisition recognizes Telestream’s history of market leadership, double-digit growth and profitability,” said Dan Castles, Telestream’s co-founder and CEO. “That growth would not be possible without our original investors and dedicated team of employees who have demonstrated a strong commitment to our customers. We look forward to our next phase of growth and expansion with Thoma Bravo as we continue to play a leadership role in the digital media industry.”

For more than 13 years, Telestream has been at the forefront of innovation, pioneering file-based video encoding and transcoding solutions for media and entertainment companies, enterprises, and consumers. According to 2011 reports by business research firms Frost & Sullivan and In-Stat, the worldwide multi-format transcoders market is poised for strong growth.

According to Mukul Krishna, Global Director, Digital Media at Frost & Sullivan, “Vendors like Telestream have been helping to fuel growth in the digital video market by providing solutions that help media companies meet the challenges of scalability and economically creating and delivering the massive volumes of content demanded by a multi-screen environment.”

“Frost & Sullivan has recognized Telestream for its best practices multiple times and based on Frost & Sullivan’s analysis, Telestream is the market leader for the global video transcoders market,” adds Avni Rambhia, Senior Industry Analyst, Digital Media at Frost & Sullivan.

Thoma Bravo is excited to partner with Telestream’s existing management team to continue to expand the company’s market leadership position,” said Holden Spaht, partner at Thoma Bravo. “We look forward to building on the company’s impressive reputation for product innovation, strategic acquisitions, and world-class customer service.”

“The video ecosystem continues to grow and expand as customers require increasingly complex tools to manage their end-to-end video workflows,” said A.J. Rohde, vice president at Thoma Bravo. “Thoma Bravo sees significant opportunity in the digital media market, and Telestream is well positioned as a strong platform for increased investment in the industry.”

Telestream has been profitable since 2001 and has self-financed three acquisitions: compression specialist Popwire in 2006; live webcasting and screencasting provider Vara Software Ltd. in 2008; and Anystream, a leading provider of automated multi-platform media publishing solutions in 2010. At the close of 2011 Telestream brings thirteen straight years of record sales growth.

The transaction is expected to close in early January 2012. Terms of the deal were not disclosed as both companies are privately held. Telestream will continue to operate as an independent entity with existing management teams continuing their current roles. Headquarters will remain in Nevada City, California with offices in Virginia, Sweden and Germany.

Trademarked company and product names are the property of their respective companies.

About Telestream
Telestream provides world-class live and on-demand digital video tools and workflow solutions that allow consumers and businesses to transform video on the desktop and across the enterprise.

Many of the world’s most demanding media and entertainment companies, such as CBS, BBC, CNN, FOX, CBC, Comcast, Direct TV, Time Warner, MTV, Discovery, and Lifetime, as well as a growing number of users in a broad range of business environments, rely on Telestream products to streamline operations, reach broader audiences and generate more revenue from their media. These companies choose to work with Telestream as they know they will get a trusted and highly skilled technical partner.

Telestream products span the entire digital media lifecycle, including video capture and ingest; live and on-demand encoding and transcoding; playout, delivery, and live streaming; as well as management and automation of the entire workflow. The company also partners closely with the industry’s leading digital media companies across the entire digital media lifecycle, from consumer to enterprise. Telestream corporate headquarters are located in Nevada City, California. The company is privately held. For more information, visit www.telestream.net.

About Thoma Bravo, LLC
Thoma Bravo is a leading private equity investment firm that has been providing equity and strategic support to experienced management teams building growing companies for 30 years. The firm originated the concept of industry consolidation investing, which seeks to create value through the strategic use of acquisitions to accelerate business growth. Thoma Bravo applies its investment strategy across multiple industries, with a particular focus on the software and service sectors, and works in partnership with management to implement its operating and consolidation expertise to build long-term value.

In software, Thoma Bravo has completed more than 46 add-on acquisitions across 18 platform companies with total annual earnings of approximately $1 billion. For more information, visit www.thomabravo.com.

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The background is here. The video is here:

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UPDATE — Here’s some photos of this morning’s parade:

(credit: Howard Levine, Grass Valley Downtown Association)

(credit: Howard Levine, Grass Valley Downtown Association)

This year’s 128th Donation Day Parade — a festive, historic event — was this morning at 10 a.m. in downtown Grass Valley. Children march through the streets carrying donations of canned goods for local families. Bagpipers and bands add a festive air to this historic Grass Valley Ladies Relief Society sponsored event.

Here’s some background from the Lyman Gilmore Middle School website: “In 1883, while Caroline Mead Hanson watched the school children pass her window on the way to Lincoln School on South School St., she had an idea. 1883 had been a particularly harsh year for the Grass Valley miners. The Eureka Mine and several others had closed, and many miners were out of work.

The Grass Valley Ladies Relief Society had been inundated with calls for help. They just had $4.86 left in their coffers.

“On November 20, 1883, Caroline Mead Hanson wrote this letter to the Daily Union newspaper:

‘On reading the report of the Ladies Relief Society I saw with regret they are much in need of assistance. I cannot aid them as I should like to do, but (like many other people) I am willing to give them the benefit of someone else’s ideas. About a year ago I read of a children’s party, which was successfully given in aid of a charitable organization in one of our eastern cities, and which I think we might get up in aid of our own society.

The plan is this: on a day to be named by our City School Superintendent all of the public school teachers would be required to ask the children in their charge to bring to the schoolhouse, each one, one potato and one stick of stove wood. The potatoes to be put in a sack by the janitor. The wood to be piled in the yard.

The donations to be brought into all the schools on the same day of the week. On the next day they would be removed by the Ladies Relief Society to any place they might judge to be in need. The donation from each child is so small, there is hardly a family who could not afford to give it, but as there are several hundred schoolchildren attending our schools the aggregate might be of some value.’

Thus, the tradition of Donation Day was born. This tradition continued to grow. Soon merchants joined the school children adding hams, and sacks of flour and merchandise to the sticks of wood and potatoes. A butcher shop owner suggested making this a parade.”

(Donation Day Parade, circa 1907)

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