Mergers and acquisitions aren’t common in the indie developer universe around Apple, so I was intrigued when I heard that long-time TidBITS sponsor Smile was selling PDFpen to Nitro Software, a company specializing in PDF tools in the Windows world. After calls with Smile co-founder Philip Goward and Nitro’s chief product officer, Sam Thorpe, I have a better understanding of the situation.
Nitro was founded in Australia in 2005 but is now a publicly traded company headquartered in San Francisco with over 200 employees around the globe. Nitro’s focus has always been on PDF tools in the Windows world, specifically in the enterprise, where 75% of the documents moving through the organization are PDFs. Its research shows that only 30% of workers have the tools they need to manipulate PDFs, largely due to the cost of Adobe Acrobat Pro DC.
As Macs, iPhones, and iPads have become more prevalent in the enterprise, largely as a result of employee-choice and “bring your own device” programs (see “JNUC 2017: A Glimpse into the World of Apple Enterprise,” 3 November 2017), the need for Nitro to expand into the Apple world became apparent. PDFpen was an obvious choice, and both Philip Goward and Sam Thorpe emphasized how the deal was aided by the fact that Smile and Nitro have very similar corporate cultures.
Nitro will pay $6 million in cash for PDFpen, and the entire PDFpen team will be joining Nitro. Sam Thorpe noted that Nitro was extremely interested in the team’s roadmap for PDFpen and appreciation of the nuances of developing for Apple-focused customers, so it seems safe to say that we shouldn’t expect to see significant technical or interface changes. The name will also remain the same, though likely with some Nitro cobranding. What may change eventually is the licensing model, with subscriptions being offered after a few more major releases. Along those lines, PDFpen will remain in the Setapp subscription service, and Thorpe noted that PDFpen revenue from that source was growing at a double-digit rate.
Where things will change is in the enterprise world. Nitro doesn’t currently have a solution for Apple users in the enterprise, and PDFpen isn’t a big player there now. So an enterprise version of PDFpen will likely take on the Nitro Pro name and will rely on a subscription model, like most other apps in the enterprise space. The recurring revenue generated by the subscriptions will help pay for developing the integrations with other systems—document signing, analytics, SDKs, and so on—that large organizations find compelling.
From Smile’s perspective, the PDFpen acquisition allows the company to focus on its TextExpander business, which has been growing in terms of employees and platforms. TextExpander now works on the Mac, iPhone, and iPad, plus Windows-based PCs and devices running Google Chrome. In contrast, PDFpen was limited to Apple operating systems, and the prospect of attempting to take it cross-platform was daunting for a company of Smile’s size, from both technical and marketing standpoints. By selling PDFpen to Nitro, Smile is essentially letting PDFpen grow in ways it would have had trouble doing on its own.
In the end, it sounds as though the acquisition is a win-win situation for everyone. Smile gets focus and money that it can use to build its TextExpander business, Nitro fills out its platform offerings in the enterprise space, and PDFpen users get continued support and development.