KKR Invests in Customer Feedback Software Provider Alchemer

Private-equity firm KKR & Co. Wednesday made a majority investment in Alchemer LLC, a software provider that helps companies collect and analyze customer sentiment data.

Terms of the deal weren’t disclosed.

The 16-year-old company, formerly SurveyGizmo, helps businesses collect and analyze customer and employee feedback. Its 13,000 customers include Verizon Communications Inc. and FedEx Inc., according to Alchemer.

The deal marks the first investment for KKR Ascendant, which the firm described as a new strategy within its Americas Private Equity platform, targeting middle-market companies with an enterprise value of under $1 billion.

“Our hope is to provide capital to continue to accelerate what management has already started around modernization of the product and investments in go-to market,” said John Park, a partner at KKR, about the Alchemer investment.

KKR said its investment will support marketing, product improvements and strategic mergers and acquisitions. The New York-based firm may help the company find talent, including senior team members and board members.

Alchemer Chief Executive David Roberts said the deal will help the company improve customer reach and expand its platform’s capabilities beyond online surveys to the ability to draw inferences based on user behavior patterns. The Louisville, Colo.-based company also plans to drive better user retention and engagement.

As the pandemic led more companies to move more operations online, with an eye toward more customer-facing applications, the market for tools gauging customer sentiment has seen activity.

Private-equity firm Thoma Bravo in October completed the acquisition of customer-feedback platform Medallia in a transaction valued at $6.4 billion. The same month, experience-management software provider Qualtrics International Inc. completed a $1.125 billion purchase of conversational analytics platform Clarabridge.

“The data from digital transactions and website behavior tells you a lot about what your customers are doing, but you really need to understand the why, and that’s why companies are looking to platforms like these,” said Colleen Fazio, senior analyst at research firm Forrester Research Inc.

KKR said its bet on Alchemer builds on the continuing interest in the global software sector.

Despite current market turmoil, including a selloff of tech stocks, Mr. Park said the software business model will continue to be resilient.

“There’s going to be a little bit more sobriety in the market in terms of valuation, but I don’t think that the activity will dry up,” he said. “I do think there will be a pickup in the back half of the year and we’ll continue to be very thoughtful in the types of companies that we’re backing.”