$11.7M TO SOFTWARE MAKER THAT SAVES FIRMS MONEY
Seasoned Business Builder Gets VC Cash for New Co.
Monday, April 23, 2018
Serial entrepreneur Tracy K. Price has been running down a dream for more than two decades.
A recent venture round backed by two strategic investors with deep global financial and business connections has given it life.
Business software maker Qmerit Inc., which Price spun out a few years ago in Irvine, completed its first institutional funding round, raising $11.7 million. The investment was led by El Segundo-based Strandview Capital and included innogy Ventures and a fund run by Schneider Electric SA.
The latter is a French conglomerate and a leader in energy management and automation services, operating in more than 100 countries, with annual revenue surpassing $30 billion. Innogy is the investment arm of German energy group Innogy SE, whose annual sales top $53 billion from over 22 million customers.
The investment included board seats for Strandview co-founder and Managing Director Kevin Covert and for Heriberto Diarte, who leads corporate ventures and external innovation at Schneider.
The proceeds will help Qmerit boost sales efforts and accelerate development of its procurement and workforce management software. Its Smart Market supply chain software is billed as substantially reducing labor and material costs through the construction industry’s first digital offering to aggregate and streamline purchasing expenses of contractors, building owners and property managers.
Qmerit takes a percentage of gross dollars generated through the online marketplace.
The company says the Smart Market algorithm also ensures exact labor resources are assigned to each job and that best-value suppliers are selected for material purchases.
Qmerit leverages the volume and data from Smart Market to negotiate discounts and rebates for big-spending original equipment manufacturers and suppliers.
“From day one, we’re able to leverage that spend,” Price said. “Manufacturers want to give more product to fewer suppliers” in order to boost their margins.
The workforce management software allows customers to vet, onboard, manage and objectively compare contractors through a proprietary index similar to a Fair Isaac Corp., or FICO, score. The index continuously grades contractors based on quality, responsiveness, compliance, customer ratings and other metrics.
It’s a challenging undertaking, considering there are more than 485,000 mechanical, electrical and plumbing contractors in the U.S., most of them small businesses below $5 million in annual revenue, according to Price.
The VC investment will also help Qmerit expand its growing client list of 15 to 20 corporations, primarily in the automotive, utility and construction sectors.
Customers include BMW, Jaguar, Land Rover, the California Energy Commission and Pacific Gas & Electric.
Price, who grew up in El Toro before it was incorporated as Lake Forest, is on his fourth venture, a personal quest of sorts.
“I’ve been dreaming this for 25 years,” he said. “It’s been my ambition forever.”
His first exit came in 1998, when he sold a stake in Irvine-based Mesa Energy Systems to EMCOR Group on undisclosed terms. The deal came two years after he co-founded FieldCentrix Inc., which made work-order management software that was implemented by Honeywell, Ingersoll Rand and others.
He sold it for $70 million to Houston energy giant Enron Corp. in September 2001 in the company’s last acquisition.
Nine weeks later, Enron collapsed amid mounting losses and an accounting scandal that also brought down its auditor, Arthur Andersen, and filed for bankruptcy.
Price spent the following two years wrestling to extract FieldCentrix from the bankruptcy proceedings, eventually succeeding and leading a management buyout in 2003 with private equity firm GI Partners that also included several facility service and HVAC providers Enron acquired over the years.
The combined entities, rebranded as The Linc Group, became one of the leading providers of facility engineering, HVAC and energy retrofits in the country. Its 2010 revenue was over $585 million, and operating income hit $40.7 million as it employed more than 4,000 in 45 states and 30 countries.
The Linc Group was sold that same year for $300 million to ABM Industries, a New York conglomerate with OC operations that provides janitorial, facilities engineering, parking, passenger assistance, catering, air cabin maintenance, transportation and specialized mechanical and electrical services.
The combined entity was a $1 billion business and reminted as ABM’s Building & Energy Solutions division with Price as president. He was also given the title of executive vice president with corporate oversight of marketing, sales and rebranding at the 100-year-old firm.
After a five-year run, he spun out Qmerit from ABM, which has a minority stake in the company and is a customer.
IRVINE, CALIF. (PRWEB) APRIL 04, 2018
Qmerit, a leader in cloud-based MRO supply chain solutions, announced it has completed its first venture capital financing of $11.75 million. Strandview Capital led the investment alongside two strategic investors -- Schneider Electric’s fund, an investment vehicle of Schneider Electric, a US $30 billion leader in energy management and automation; and innogy Ventures, the investment arm of Germany-based energy group innogy SE. Kevin Covert from Strandview and Heriberto Diarte from Schneider Electric will join Qmerit’s Board of Directors.
Qmerit’s merit-based solutions significantly reduce labor and material costs and improve service quality for building owners, property managers, OEM’s and contractors. Qmerit’s Smart Market™ algorithm ensures that the optimal labor resource is assigned to each job and the best value supplier is chosen for material purchases.
Qmerit’s Workforce Management platform transforms the way companies vet, onboard, manage and objectively measure their contractors through a proprietary Qmerit Contribution Index™ (QCI). Similar to a FICO score, a QCI score is continuously calculated for each contractor based on their quality, responsiveness, compliance, customer ratings and more. Qmerit was recently recognized as a Top 10 Workforce Management Solution Provider by HR Tech Outlook.
Qmerit’s Procurement platform substantially reduces material acquisition costs through the industry’s first solution that aggregates the purchasing spend of contractors, building owners, and property managers. Qmerit has leveraged this unparalleled purchase volume to negotiate significant discounts and rebates with OEM’s and suppliers. Qmerit’s eProcurement software provides desktop and mobile access to these discounts and streamlines the procurement process.
“We are absolutely delighted to have garnered the support of such prestigious strategic investors. The experience of these industry leaders combined with our 25+ years of domain expertise and disruptive technologies will enable us to transform the building trades industry,” says Qmerit Chairman, Founder and CEO, Tracy K. Price. “We also very much appreciate the roles Strandview Capital and our friends and family investors played in bringing this transaction to fruition.”
The investment will help Qmerit aggressively expand its sales efforts as well as increase and accelerate product development. The investment will also help Qmerit expand its rapidly growing client list, which already includes multiple Fortune 500 companies.
Strandview Capital is a private equity firm that provides growth equity capital to companies in the financial services and financial technology sectors. Strandview incorporates a unique hands-on strategic approach that leverages its deep industry specialization and relationships to add substantial value to its partner companies. Strandview is typically the lead investor on financing transactions and makes large minority equity investments into companies with proven products, capital-light business models, and a focus on profitability. The Strandview team utilizes a contrarian, defensive and value-focused strategy that has resulted in a successful track record over 12 years and four funds of investing in companies that perform well in both growth and recessionary market environments.
Schneider Electric is leading the Digital Transformation of Energy Management and Automation in Homes, Buildings, Data Centers, Infrastructure and Industries. With a global presence in over 100 countries, Schneider is the undisputable leader in Power Management – Medium Voltage, Low Voltage and Secure Power, and in Automation Systems. We provide integrated efficiency solutions, combining energy, automation and software. In our global Ecosystem, we collaborate with the largest Partner, Integrator and Developer Community on our Open Platform to deliver real-time control and operational efficiency. We believe that great people and partners make Schneider a great company and that our commitment to Innovation, Diversity and Sustainability ensures that Life Is On everywhere, for everyone and at every moment.
innogy Ventures is the venture capital investment firm related to the innogy Innovation Hub. Investment focus is on innovative and digital business models in North America, Europe and Israel which aim at sustainable transformation in areas such as Future Energy, IoT, Urban Solutions and Customer Engagement. innogy Ventures and innogy Innovation Hub support their portfolio companies with comprehensive market knowledge, assistance in business development and links to the widespread innogy network and to relevant market participants. innogy Ventures and innogy Innovation Hub are funded by innogy SE, one of Europe’s largest energy groups with over 22 million customers, sales of around 43 billion euros (2017), more than 42,000 employees and activities in 16 European countries.
Bringing Meritocracy to Workforce Management
The U.S. Government Accountability Office released a report stating that over 40 percent of the workforce in the country comprises contingent workers, expected to grow to 50 percent by 2020. Having extensive knowledge of the skills and performance of not just the internal workforce, but also a myriad of sub-contractors, retirees, and part-timers, has now become the central agenda for medium-to-large sized organizations. “In my career experience, I realized that there was no way to quantify the performance or skills of distributed, frontline human capital,” recalls Tracy K. Price, founder and CEO of QMerit. Over the course of his diverse career—from starting as a frontline worker and working his way up in the entrepreneurial ladder—Price noticed that the traditional annual performance reviews were often plagued by personal bias, subjectivity, and randomness, with no true factual context in the five-star or thumbs-up rating systems.
Based in Irvine, California, QMerit created an innovative, enterprise-grade software platform for service organizations based on Microsoft Azure. Managing direct employees, temporary workers, and subcontractors on a single cloud-based platform, the QMerit meritocracy-based engine allocates the best resources at the best value for every service request, motivates the workforce to deliver consistent service on every service job, and continuously measures performance to provide feedback. The startup has already secured industry-leading customers such as BMW North America, and it looks forward to creating workforce meritocracies for service organizations in multiple market verticals.
BMW of North America announces that QMerit will provide BMW i and BMW iPerformance drivers with customized installation of home charging solutions to enable convenient and reliable vehicle charging. Customers can easily begin the BMW Installation Services process at www.bmwcharging.com. Along with the BMW Charging Station, BMW Installation Services are part of the premium 360°
QMerit, Inc., the creator of an innovative new SaaS platform for efficient labor sourcing in the technical services and home healthcare markets, is pleased to announce the appointment of Mark Heaney as its Board Director. In his role, Heaney will help the company continue to expand its offering and communicate the QMerit value proposition to the home healthcare market place.
When Brandman University partners with a business or organization, it looks for ones which share the university’s values, most importantly the importance of higher education and lifelong learning. Some of those partners form Irvine’s Premier Partners Advisory Council and they offer their organizations’ feedback about what they need from university graduates.
Experienced Development Executive Brings Right Skills to Drive New Cloud-Based Labor Resource Technology to Market
QMerit, Inc., the creator of an innovative new SaaS platform for efficient labor matching in the technical services and home health care markets, is pleased to announce the appointment of Manoj Puthenveetil as its vice president of software engineering. In his role, Puthenveetil -- who helped develop the technology -- will help the company go to market and oversee continued enhancement and delivery of the QMerit technology platform.