The digital consulting firm West Monroe has acquired Carbon Five, a product management, digital design and software engineering firm that opened one of its national offices in Chattanooga seven years ago.
With the purchase, West Monroe will operate a dozen offices across the nation with more than 2,000 workers, including the 10 employees at the Chattanooga office on Williams Street downtown that the new owners say they hope to grow with more workers.
The acquisition is part of West Monroe's strategy to expand its end-to-end digital services and comes less than three months after the Chicago-based company also acquired Verys, a 200-person product development firm.
Founded in 2002, West Monroe is one of America's fastest-growing digital consulting firms and is expected to generate more than $500 million in revenues this year working with companies in health care, insurance, utilities, retailing, food production and other industries.
Last month, the investment firm that grew out of billionaire Michael Dell's family office, MSD Partners, acquired a 50% stake in West Monroe with the other half of the company owned by its employees. The deal valued the Chicago-based company around $2.5 billion, according to Bloomberg news.
Tom Bolger, chief strategy officer at West Monroe, said Carbon Five "is a like-minded organization with strong talent and integrated product capabilities.
"When paired up with Verys's scale and West Monroe's core expertise in strategy, industry and tech, we are able to drive long-lasting value and partnership to our clients," he said.
Carbon Five, which began in 2000, has offices in Los Angeles, San Francisco, New York and Chattanooga.
Alex Cruikshank, general manager and tech lead for Carbon Five in Chattanooga, said the company decided to open an office in Chattanooga in 2014 because of the city's high-speed Gig internet connections and its growing technology startup culture.
"The startup community that is here and the kind of talent that gave us access to hire, in addition to the good community here to work in, is what drew us to Chattanooga," Cruikshank said.
Although the Chattanooga office is the only Carbon Five location in the Southeast, Cruikshank said the staff primarily works on national accounts, including a lot of recent work with healthcare, fintech and cryptocurrency industries.
"We're excited about Carbon Five because they are really world-class in their product development," said Greg Layok, managing partner of technology for West Monroe in Chicago. "We're growing our product engineering and our product development capabilities, and we have been very impressed with the depths of the capabilities at Carbon Five. We want to find the best talent wherever we can find it, and it turns out there is a great talent pool in Chattanooga, and we're anxious to continue to grow in Chattanooga, which works out great in diversifying where we are and in its time zone serving so much of the country."
Carbon Five co-founders Mike Wynholds and Don Thompson will continue to run Carbon Five as a West Monroe-owned company until integration, which is expected to be complete in 2022.
As part of West Monroe, Carbon Five will collaborate across the firm in multidisciplinary teams made up of technologists, industry experts, business strategists, product engineers and others to provide a comprehensive set of solutions for customers.
Although West Monroe is currently focused on the American market, the recent investment from MSD will allow the company to fund international expansion.
"We are currently U.S. focused, but we will be opening a London office in the first quarter of next year," Kevin McCarty, the company's chairman and chief executive officer, told Bloomberg.
Contact Dave Flessner at dflessner@timesfreepress.com or at 423-757-6340.