Digital engineering and artificial intelligence (AI) services provider Accolite Digital has announced merger with digital consultancy Bounteous. Chicago-headquartered Accolite, with a significant India presence, along with Bounteous will create a new end-to-end digital transformation services consultancy and partner with leading brands globally — including 300 Fortune 1000 and high growth clients. Both companies are backed by New Mountain Capital, a New York-based investment firm.
The merged entity will have total headcount of 5,000 people, with APAC accounting for lion’s share of over 3,400 employees. Others will operate from North America and Europe. Keith Schwartz will serve as CEO and Leela Kaza will serve as Co-CEO of the combined entity. The joint company aims to scale to billion dollar valuation in coming years.
“With the digital innovation mastery of Bounteous combined with Accolite’s digital engineering expertise and talent across North America, EMEA, and APAC, we are uniquely positioned to empower our clients to create extraordinary customer experiences that inspire genuine brand appreciation and long-term loyalty. This combination also fulfills our stated goal of becoming one of the top 10 privately held digital engineering firms in the world,” said Leela Kaza, Founder and CEO of Accolite.
The combined entity will serve industries such as Banking, Financial, and Insurance; Consumer Goods and Retail; Healthcare; Logistics; Restaurant and Convenience; Telecommunications; Technology; and Travel & Hospitality. It will provide solutions across AI and data, Cloud, customer experience and martech, digital commerce, and product engineering.
“We see tremendous growth potential in the combination of these two companies, both of which bring impressive, blue-chip customer rosters, world-class digital consulting and engineering capabilities and a deep commitment to innovation. The technology, skills and global delivery capabilities represented here create a highly attractive digital transformation partner for C-suite leaders at the biggest brands in the world,” said Prasad Chintamaneni, managing director at New Mountain Capital.
The digital consultancy Bounteous is merging with Accolite Digital, and together they plan to become a billion-dollar company in five years.
Bounteous and Accolite Digital offer different, yet complementary services. The private equity firm New Mountain Capital, which invested in both companies in 2021, instigated the idea for this merger late last year.
Bounteous, a Chicago-based consultancy, mostly works with chief marketing officers in North America and designs customer-facing experiences. Its clients include Coca-Cola, Caesars Entertainment, Domino’s, and others, and it largely competes with other consultancies like Accenture and Deloitte Digital, Bounteous CEO Keith Schwartz told Business Insider.
Accolite, based in Dallas, builds products that large enterprises use internally. For instance, it built a wearable device for FedEx that detected fatigue among drivers and pilots and ran predictive analytics to identify potential accidents, Accolite CEO Leela Kaza told Business Insider. FedEx used this data to make pilots’ schedules and truck drivers’ routes more efficient, and now licenses that software to other carriers, Kaza said.
Accolite’s clients include telecommunications and financial services companies, including Goldman Sachs, Prudential, and BT. It mostly works in India, but it also has presences in the US, Canada, Mexico, and Europe.
The decision to merge happened when New Mountain noticed that Accolite clients would ask for design services that are Bounteous’ expertise, and Bounteous clients would ask for help with their cloud infrastructure and data analytics, which is Accolite’s focus, said New Mountain managing director Prasad Chintamaneni.
The combined firm will have 5,000 people and be headquartered in Chicago. Schwartz and Kaza will both lead the combined company. For now, the merged company will be called Bounteous X Accolite, although Kaza said they will finalize its new name in May.
Kaza will oversee areas like human resources and operations, and Schwartz will oversee sales, marketing, and finance. The companies will have minimal layoffs post-merger, Kaza said, though there will be some redundancies in support functions.
“I look at all sorts of mergers and possibilities, and sometimes there’s a tremendous amount of overlap,” said Schwartz. “In this case, there’s a tremendous amount of white space.”
The road to $1 billion
The two companies’ combined revenue is nearing half a billion, and they have big plans to hit the billion-dollar mark in about five years.
To get there, Bounteous X Accolite is banking on 2024 as a year of modest growth, with real acceleration in 2025 and 2026, said Kaza.
“That’s when you’re going to start heading towards that billion-dollar figure,” Kaza said.
The company will then supplement its projected organic revenue growth with M&A, looking for “strong firms” that can work with marketing tech from Salesforce and Adobe in regions like Latin America and Eastern Europe, Kaza added.
“You do these things to make the company better, not bigger,” Schwartz said. “If you make the company better, clients reward you with more work, and you will grow.”