Enduring businesses put customers first. OSIsoft, a leader in software to manage operational intelligence, has been doing that since its founding over 37 years ago. For the past six years, TCV has been an investor in this iconic company and had the good fortune of watching them grow into a leader in the burgeoning Industrial Internet of Things (IIoT) market — a market that we believe will redefine many industrial sectors as we know them.

Today, we congratulate OSIsoft on its announcement that SoftBank has acquired TCV’s ownership stake and will become a minority equity investor in the company. The partnership is significant on many levels. By adding an established market leader to its technology portfolio, SoftBank is expanding its platform to drive growth and leadership in IIoT. It also emphasizes the vast opportunity for software companies such as OSIsoft to help make the world’s industrial infrastructure more connected, efficient, flexible, and sustainable. This will truly be a powerful combination that we believe will benefit OSIsoft’s current customer base and future customers for years to come.

OSIsoft’s software, the PI system, excels at pulling together data from disparate sources — including meters, sensors, and industrial equipment — at unprecedented scale — and presenting it as meaningful information. For example, it helps utilities bring safe drinking water to millions of people and manage the use of water in households and industries. It helps oil and gas companies manage and optimize their assets more effectively. It helps food and beverage companies deliver consistent products aligned with FDA regulations. In addition, it helps factories, campuses, airports, data centers, and many others manage energy and reduce waste.

In 2007, we invested in Seismic-Micro Technology (SMT), which gave us first-hand insight into how oil and gas companies value operational intelligence and its importance from a regulatory and operational efficiency perspective. We spent the next two years talking to potential customers for this type of software and realized the need across multiple industrial sectors, including chemicals, pharma, mining, food and beverage, and many others. All of this work pointed us again and again to one company: OSIsoft. While most tech bellwethers such as IBM, GE and Cisco didn’t even have a formal IIoT strategy at the time, here was a company under the radar in the San Francisco East Bay that had never taken external capital and quietly built an unparalleled suite of products, a growing base of loyal customers, and off-the-charts Net Promoter Scores.

We first met founder and CEO Pat Kennedy in 2009. Pat made no secret of the fact that he didn’t want an investor that was looking for a quick exit. In fact, he wasn’t looking to raise capital at all. In order to invest, we had to bring more than just capital, and we began by helping with introductions to customers and M&A referrals. We also took the time to learn about the values Pat cared deeply about – both as a person and as a business leader. Like Arie De Geus, author of The Living Company, Pat advocated conservative financing, a sustainable approach to business, the embrace of new ideas, and putting people ahead of economics. It was a management philosophy that has served him well and continues to be the guiding light for the company today.

Supporting Pat and his leadership team cemented our thesis around the company’s immense potential in data management, long before the valley was talking about IIoT. We also shared Pat’s long-term perspective and commitment to helping OSIsoft realize its dream of deploying PI at every industrial site in the world to increase customers’ potential and success. Along with our investment partner Kleiner Perkins, we worked with Pat and his team to achieve a deal structure that achieved Pat’s objectives in 2011, which marked the first-ever institutional financing in the company.

As a member of OSIsoft’s Board of Directors, we provided another set of eyes and ears for the company post our investment. With the support of the TCV network, we worked closely with Pat to help him build out his team, improve sales processes, sharpen pricing, support M&A opportunities to expand the company’s global footprint and address high-growth verticals, and launch and strengthen strategic partnerships. Over the next few years, OSIsoft grew to over 1,000 employees and significantly increased billings.

We are excited about the future opportunities for IIoT and OSIsoft. SoftBank is a technology leader focused on a future where millions of things, cities, economies, companies, data centers, and infrastructures will be connected. We are delighted that OSIsoft is partnering with SoftBank and grateful that we’ve been part of OSIsoft’s journey for a small, yet important piece of its history. OSIsoft is a truly unique company, and today is a bittersweet moment for TCV. We’ve loved working with Pat and his team and are confident in our belief that the company has a great future. We wish Pat and the entire OSIsoft team and SoftBank immense success. All of us here at TCV will follow their progress for years to come.


The TCV portfolio company identified above is not representative of all TCV investments, and no assumption should be made that the investment identified was or will be profitable. For a complete list of TCV investments, please visit www.tcv.com/all-companies/. For additional important disclaimers regarding this post, please see “Informational Purposes Only” in the Terms of Use for TCV’s website, available at http://www.tcv.com/terms-of-use/.