Atlassian will gain a "critical component" for its enterprise collaboration software toolset — social task management — through its planned $425 million acquisition of project workflow provider Trello, an analyst told CMSWire this morning.
Atlassian, which has headquarters in Sydney, Australia and San Francisco, announced today a definitive agreement to acquire Trello for $360 million in cash and the rest in stock options. It is Atlassian's 18th — and largest — acquisition.
"People are overwhelmed with content and tasks," said Alan Lepofsky, principal analyst covering the Future of Work for Cupertino, Calif.-based Constellation Research. "Social task management tools enable people to organize, prioritize and execute on work."
Atlassian owns collaboration platforms that allow workers to chat in private and group settings (HipChat), collaborate on Git revision control projects (Bitbucket), create content (Confluence) and track software projects (JIRA). Trello's platform provides work teams with software to organize and prioritize information, idea sharing and tasks.
Enterprise Collaboration Is Booming
Will the acquisition be critical enough for Atlassian to stand out in the enterprise collaboration market? The acquisition comes a week after MarketsandMarkets predicted the enterprise collaboration market will hit $26.7 billion this year — and $49.5 billion by 2021.
Microsoft and Facebook made their moves with big enterprise collaboration platform debuts 2016. Atlassian launches the first salvo of 2017.
In October, Facebook launched its own enterprise collaboration tool, Workplace by Facebook. Facebook signed 1,000 organizations in its 18-month beta mode. In November, Microsoft launched Teams, an addition to its Office 365 suite that opens the door to private chats. Last week, Slack announced investments in 11 startups to grow its bot directory.
Just how "big" this acquisition is won't be known until it shows up in Atlassian's financial reports. The company reported $457 million for fiscal 2016, a 43 percent growth year-over-year with an operating income loss of $5.88 million, according to an annual report filed with the US Securities and Exchange Commission (SEC).
Task Management Landscape
The acquisition could give Atlassian muscle in the collaboration space.
According to Constellation Research's October review of enterprise suites with project features, Atlassian will join Bitrix24, IBM Connections, Igloo Software, Microsoft Office 365 Planner, Neudesic Pulse, SAP Jam, TIBCO Software and VMware Socialcast as providers that include project management features (or a dedicated application) as part of the larger collaboration platform.
Slack does not have native task management yet. They require integration with a provider like Asana or Trello, according to Lepofsky.
These enterprise-grade vendors include attributes such as:
- Administrative controls (e.g., user and group management, directory sync)
- Analytics/metrics/usage dashboards — personal, team and project
- Application development capabilities (i.e., integrations, extensions)
- Client access points (e.g., desktop, mobile, tablet, large screen, embed in other applications)
- Collaboration (e.g., commenting, liking, sharing) at the project and task level
- Multiple user interface options for displaying information, including activity streams, Kanban columns (card view) and Gantt charts
- Native file storage and sharing and/or integration with popular third-party services
According to Lepofsky's market research on social task management, Trello’s offering combines the collaboration features of social networking software with the organizational and task features of project management software. Other vendors in this category include include Asana, Clarizen, LiquidPlanner, Projectplace by Planview, Smartsheet, Workfront and Wrike.
Trello's Development Visions
The Trello acquisition will follow a similar playbook of most of its Atlassian precedents, said Nancy M. Goebel, managing director, member and benchmarking services for Digital Workplace Group.
"The buzz is that the company plans to keep both the Trello service and brand alive," Goebel told CMSWire. "It actually sounds like Atlassian is committed to developing Trello, much like they’ve done with many prior acquisitions."
Current clients shouldn’t see any immediate changes, she added. Atlassian will likely discuss its Trello integration plans it reports second quarter results on Jan. 19.
Margo Visitacion, vice president of BT strategy professionals for Forrester Research, said the acquisition could open the door for more enterprise level usage because it's not developer specific.
"The power-up features in Trello," she told CMSWire, "allow you to create a customized user experience that is appealing for a non-development audience, but Trello is focused on either a single user or a small group of users. It doesn't scale well when you need to collaborate with large teams. There's enough overlap with JIRA that Trello doesn't provide differentiating features, so my guess is that they are definitely targeting the casual user because the acquisition does bring is a pretty sizable user base for a viral product."
JIRA and Confluence (two-thirds of total revenue, according to Atlassian's annual report) and HipChat can use Trello to help follow through the bug-reconciliation process, and also with decisions made by teams through collaboration, according to David Coleman, founder and managing director of Collaborative Strategies, Inc., a San Mateo, Calif.-based consulting firm that works with collaboration vendors and software users.
"In this respect," Coleman told CMSWire, "Trello is a logical addition, and the population Atlassian serves (developers) are already used to project management and kanban-like displays. In 2009 many of the document management-oriented collaboration tool vendors acquired project management functionality. Vendors like Microsoft, Huddle and others integrated project management, so in that sense project management was a hole in the Atlassian product line for a while — a hole they now have filled."
Adding Structure to Work
Atlassian officials maintain this acquisition will be a differentiator. They'll "stay a step ahead of the likes of Microsoft, Salesforce, Google, Facebook," officials noted in an email today to CMSWire.
The move marks another acquisition for the company valued at $5.43 billion, according to NASDAQ.
"Over the past five years, Trello has grown to over 19 million registered users by solving an important problem: capturing and adding structure to fluid, fast-forming work," Mike Cannon-Brookes, CEO and co-founder of Atlassian, said in a blog post today, who added Trello's visual system has been used by teams to manage marketing campaigns and track action items from team meetings.
Where does Trello land in the Atlassian ecosystem?
It plans to launch a new version of its existing Trello integration for HipChat and develop Trello integrations for JIRA Software, Confluence and Bitbucket. The integrations will be available in the Atlassian Marketplace, which includes more than 2,000 add-ons and extensions and has generated more than $200 million in lifetime sales, according to Atlassian officials.
“We share Atlassian's mission of unleashing the power of all teams," Michael Pryor, Trello's CEO, said in a statement. "Atlassian’s deep investments in research and development will help augment Trello's product offering."