Carlyle explores $2.5bn-plus sale of alternative data provider YipitData

Goldman Sachs is advising on the process, which remains at an early stage and could attract both strategic buyers and other private equity firms, though sources cited in the Reuters report cautioned that a deal is not guaranteed.

Carlyle led its funding round in December 2021, when YipitData was valued at more than $1bn. A sale in the $2.5bn to $3bn range would therefore represent well over double, and potentially close to triple, that mark in under five years. Norwest Venture Partners, an earlier backer, also retains a stake in the business.

The interest is being driven by artificial intelligence. Investors are paying up for companies with proprietary datasets, partly because unique data can be used to train AI models, and partly because hard-to-replicate data assets keep generating revenue even as AI erodes demand for other kinds of software. That combination has turned specialist data providers into some of the most sought-after targets in technology dealmaking.

Founded in 2010 by Vinicius Vacanti and James Moran, the company turns billions of alternative data points into research and analytics, helping hedge funds, private equity firms, asset managers, and corporations track performance across e-commerce, payments, software, ridesharing, and consumer technology. It now serves more than 650 customers, among them Walmart, Lowe’s, and Ulta Beauty. The business is on target to generate about $280m in annual recurring revenue this year, with sales growing at more than 30%.

A recurring-revenue, high-growth data business is exactly the kind of asset that has commanded premium multiples in a run of recent deals. Sixth Street recently acquired commodities intelligence provider Kpler at a valuation north of $3.7bn, while S&P Global completed the $1.8bn purchase of London-based financial data firm With Intelligence in November.