Latest acquisition helps manufacturers transform productivity and frontline engagement to deal with the challenges of rising input costs and labor shortages
SANTA BARBARA, Calif.—QAD, Inc., a Thoma Bravo portfolio company delivering next-generation manufacturing and supply chain solutions in the cloud to enable the Adaptive Enterprise, has closed the acquisition of Redzone, the #1 connected workforce solution for manufacturing.
Over 1,000 plants and 300,000 frontline workers worldwide rely on Redzone's solutions to create a better employee experience for frontline teams and transform productivity by energizing and arming teams with the digital workflows and collaboration tools to get the most out of every shift.
"We are delighted to bring Redzone into the QAD family," said QAD CEO Anton Chilton. "We believe the emerging connected workforce space is the most transformational area of technology for manufacturing companies. As we assessed the market for the category leader, it was evident that not only is Redzone the #1 provider globally but also the pioneer of the category and the one who continues to define it. And the Company's financial performance speaks to its market leadership: profitable since inception, SaaS revenues growing 35 percent organically, and a clear path to being the first connected workforce solution in manufacturing to achieve $100 million revenue run rate this year."
"Since acquiring QAD in 2021, we have remained committed to supporting the Company in its mission to enable its customers to rapidly adapt to disruption and effectively innovate for competitive advantage," said Peter Stefanski, a Partner at Thoma Bravo. "The acquisition of Redzone, with its impressive growth trajectory in a large, unpenetrated $40 billion market, demonstrates our commitment to advancing QAD's vision and to further building its leadership position in the broader industrial software universe."
This is the second acquisition completed by QAD in the last two months – in December, QAD acquired Livejourney, a provider of a real-time process mining and predictive modeling solution designed to discover, monitor and improve business processes.
Redzone received a growth equity investment from Summit Partners in 2020 and has continued to deliver strong growth over the last several years. In 2022, the Company defied a slowing SaaS market, accelerating bookings growth to 46 percent, adding over 100 new clients and over 200 new plants by meeting the critical needs of manufacturers with its suite of frontline Productivity, Compliance, Reliability and Learning applications. Global manufacturers that benefit from the technology include the likes of Nestle, Post Holdings and Tyson.
"Connected Frontline Workforce (CFW) applications are proven human-centric platforms that accelerate business value with real-time insights and knowledge management, leading to faster, better decisions," said Allison Kuhn, EHS, Sustainability/ESG, Future of Industrial Work Research Analyst, of LNS Research. "LNS Research expects a dramatic increase in CFW adoption as manufacturing executives significantly accelerate focus on Future of Industrial Work initiatives and look to transform the end-to-end employee lifecycle and experience."
QAD Adaptive Applications are designed to support the Adaptive Enterprise where in a turbulent world, facing disruptions in supply and fluctuations in demand, manufacturers and supply chains rapidly respond to change and seamlessly optimize agility, efficiency and resilience for effective customer service.
The addition of Redzone's connected workforce product supercharges the QAD Adaptive Applications product suite by enabling QAD customers to drive rapid, tangible increases in empowerment, retention and productivity on the frontline. When employees have a growth mindset, they are better able to take extreme ownership of the challenges that impact their production goals and continuously improve, creating resilience in the face of disruption.
"People, process and technology are critical elements of any organization, and in a world of increasing labor shortages, the people factor becomes of paramount importance," said QAD CEO Anton Chilton. "QAD has concentrated on delivering industry best practices to manufacturers supported by industry leading technology delivered through the cloud. Redzone's focus on people, their productivity and engagement addresses a primary area of opportunity for our customers."
"Joining QAD will accelerate our mission of transforming manufacturing by empowering the frontline," said Redzone co-Founder and CEO Richard Tester. "We have always put the frontline worker at the heart of our technology and know that arming these teams with the right digital workflows is the fastest way to unlock productivity on the plant floor. Redzone has been the leader in the food and beverage and CPG industry but more recently expanded into the automotive, life sciences and discrete manufacturing verticals with great success. With QAD's expertise in these aligned verticals, combined with its large global customer base and footprint, Redzone will experience more growth further cementing our position as the category leader."
Labor productivity improvements directly impact efficiency. Productive and empowered employees increase the effective capacity of a manufacturing plant and accelerate time to productivity for new employees. This gives manufacturers the agility they need while also reducing the amount and impact of employee attrition.
Recent worker shortages have plagued manufacturers and are not going away – according to Deloitte, the labor shortfall is likely to reach 2.1 million and cost the economy $1 trillion by 2030. With the addition of Redzone, QAD now has a complete end-to-end solution for manufacturers to fully realize the potential of the Adaptive Enterprise from the shopfloor to the top floor, and from supplier to end customer.
"QAD Redzone addresses some of the greatest productivity challenges manufacturers face today including rising input costs, wage inflation and labor shortages. We have been incredibly impressed with the results Redzone customers are achieving; on average, manufacturers using Redzone have increased productivity by 22 percent, improved employee engagement by 74 percent and reduced staff turnover by 32 percent in just 90 days," said QAD Chief Product Officer Charles Sutherland.
Barclays served as financial advisor to Redzone, with Wilson Sonsini acting as legal counsel. Kirkland and Ellis LLP served as legal counsel to QAD and Thoma Bravo.
For more information on this acquisition, please visit the QAD website or contact us at connectedworkforce@qad.com.
If you're interested in learning more about these solutions for your business, please join us for a QAD Redzone webinar on Wednesday, February 8 at 10:00 AM CST. The webinar will highlight the vision for QAD Redzone, an overview of the QAD Redzone Connected Workforce Solution and the significant outcomes customers have achieved. Register here.
About Redzone
As the #1 connected workforce solution in manufacturing, Redzone enables frontline teams to contribute their full potential, elevating the frontline with new technology to achieve company goals around productivity and throughput. Today, hundreds of thousands of frontline workers are valued, celebrated, and working with purpose; creating stronger communities inside and outside their plants. With customers both big and small, Redzone is helping more than 1,000 plants worldwide achieve remarkable productivity gains in just 90 days.
For more information visit www.rzsoftware.com.
About QAD – Enabling Adaptive Enterprises
QAD Inc. is a leading provider of next-generation manufacturing and supply chain solutions in the cloud. To succeed in a turbulent world, facing disruptions in supply and fluctuations in demand, manufacturers and supply chains must rapidly respond to change and seamlessly optimize agility, efficiency, and resilience for effective customer service. QAD delivers Adaptive Applications to enable these Adaptive Enterprises.
Founded in Santa Barbara, California, QAD has customers in 84 countries around the world. Thousands of companies have deployed QAD enterprise solutions including enterprise resource planning (ERP), digital commerce (DC), supplier relationship management (SRM), digital supply chain planning (DSCP), global trade and transportation execution (GTTE) and enterprise quality management system (EQMS). To learn more, visit www.qad.com or call +1 805-566-6100. Find us on LinkedIn, Twitter, Facebook and Instagram.
“QAD” is a registered trademark of QAD. All other products or company names herein may be trademarks of their respective owners.
About Thoma Bravo
Thoma Bravo is one of the largest software investors in the world, with more than $120 billion in assets under management as of September 30, 2022. Through its private equity, growth equity and credit strategies, the firm invests in growth-oriented, innovative companies operating in the software and technology sectors. Leveraging Thoma Bravo’s deep sector expertise and strategic and operational capabilities, the firm collaborates with its portfolio companies to implement operating best practices and drive growth initiatives. Over the past 20 years, the firm has acquired or invested in more than 420 companies representing over $235 billion in enterprise value.1 The firm has offices in Chicago, London, Miami and San Francisco. For more information, visit Thoma Bravo’s website at thomabravo.com and Twitter @ThomaBravo.
1 Includes control and non-control investments.
Read the release on the Business Wire website here.