BlueAlly Technology Solutions, backed by private equity firm Source Capital. has acquired Virtual Graffiti — a managed IT services provider (MSP) focused on network security, storage, and cloud solutions.

This is M&A deal number 112 that ChannelE2E has covered so far in 2021. See all technology M&A deals for 2021 and 2020 listed here. This deal was facilitated by martinwolf’s ITX division, a midmarket M&A advisor.

Virtual Graffiti of Irvine, California, launched in 1999 as an e-commerce software development company. The company’s focus ultimately shifted to network security.  Virtual Graffiti achieved revenue growth of more than 50 percent from 2017 to 2019, according to an Orange County Business Journal report from 2019. Also, Virtual Graffiti ranked among Cisco’s top 10 percent Partner Plus members as of October 2018. ChannelE2E could not find more recent growth rates for the company.

BlueAlly of Cary, North Carolina, launched in 2011. The company offers complete technology lifecycle management — from initial design and implementation to on-going managed security and infrastructure services.  Source Capital has owned a controlling interest in BlueAlly since June 2020.

BlueAlly Acquires Virtual Graffiti: Executive Perspectives

In a prepared statement about the dal, Source Capital Managing Partner Tom Harbin said:

“BlueAlly and Virtual Graffiti have built impressive IT services and solutions focused businesses but with different business models. The capabilities and cultures of the two organizations are highly compatible and the combined company will be well-positioned to accelerate growth.  We look forward to supporting the strategies of this new player in the IT services sector.”

Vijay Tanamala, founder, BlueAlly

Vijay Tanamala, founder and executive chairman of BlueAlly, added:

“Through the combination of Virtual Graffiti’s unique security expertise and BlueAlly’s managed security services offering, new and existing customers will have access to best-in-class security solutions and services. The partnership with Virtual Graffiti ideally positions the combined business to best serve the rapidly growing IT security industry.”

Concluded Hillel Sackstein, founder and CEO of Virtual Graffiti:

“Virtual Graffiti has built a differentiated IT solutions platform centered around security solutions. For some time, we have wanted to add a managed security services offering to meet our customers’ needs and enable further growth.  BlueAlly gives us immediate access to such an offering, along with the infrastructure to deliver these services on a larger scale.”

Source Capital: Private Equity Focus

BlueAlly’s private equity owner, Source Capital, typically backs companies with more than $2 million in EBITDA seeking a growth-oriented partner. Source Capital since its founding in 2002 has made:

  • 23 equity platform investments;
  • 41 add-on acquisitions; and
  • 30 debt investments.

 



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