New Everbridge CEO takes over at critical time
New Everbridge CEO David Wagner details his areas of focus for the company. Investor Ancora has suggested that a private equity firm should acquire Everbridge.
In the last year, critical event management provider Everbridge Inc. has had to manage some critical events of its own.
In December 2021, Everbridge stock fell by almost 50% after CEO David Meredith abruptly resigned. In March 2022, activist investor Ancora sent an open letter to the Everbridge board of directors that called for them to explore a sale of the company. Ancora, which has a 4% stake in the company, argued that Everbridge underperformed under the board and executive team at the time.
Shortly after Meredith's resignation, Everbridge named interim co-CEOs from inside the organization, but in July went outside the company and hired David Wagner as the new CEO. Wagner, most recently the president and CEO of email security provider Zix, said the mission of Everbridge drew him to the role.
"I could join a team that is fundamentally working to keep people safe and organizations running faster," said Wagner, who also serves as Everbridge president and board member.
Everbridge, based in Burlington, Mass., has about 6,300 customers and 1,900 employees.
Before and after the CEO hire
Before Wagner took the Everbridge CEO job, the company started restructuring, which included layoffs. Everbridge laid off fewer than 100 people earlier this year, Wagner said.
The company continues to review its office footprint, given the work-from-home surge that began with the COVID-19 pandemic.
"We're looking at all kinds of opportunities to improve the efficiency of the organization, to drive profitability," said Wagner, who has been a B2B software executive for 30 years. "Our first focus is on our customers and driving their more efficient, productive use of our platform."
The company does not expect to make further layoffs as part of the restructuring and has started hiring again, Vernon Irvin said in June, when he was serving as co-CEO. He is now the chief revenue officer, and former co-CEO Patrick Brickley is now the CFO -- both positions they held previously. Both were in contention for the permanent CEO job.
"Buying companies like we did requires you to simplify the product portfolio. But also, when you buy companies, they all have multiple CRMs, multiple IT infrastructures and hosting infrastructure," Irvin said. "So we took that opportunity to realign and optimize the workforce related to that integration work."
David WagnerCEO, Everbridge
In his first two months on the job, Wagner said he has been focused on people -- employees, customers and shareholders. He has met with all three groups.
Analysts at GigaOm said the Everbridge CEO role calls for someone who can bring everyone and everything together in a cohesive way. Everbridge has made several acquisitions in the last few years, including risk intelligence vendor NC4 and cell broadcast provider One2many.
"Everbridge wasn't the company five years ago that it is today," said Ron Williams, analyst at GigaOm. "I haven't always known where they were going to go with those products, and this [CEO hire] may be the thing that allows them to put out a consistent message about where they're taking the company."
Wagner has "a good track record," said Jon Collins, vice president of research at GigaOm.
"You need someone at the helm who sees it as a coherent platform, not as a set of pieces to be monetized individually," Collins said. "In general, the market is building consolidated platforms that actually deliver at a higher level."
What does it all mean for customers?
Everbridge has started simplification and realignment of its software product portfolio, which it has reorganized into five bundles: Business Operations, Digital Operations, People Resilience, Smart Security and Public Safety.
"We've extended our stack to move from basic notification -- something has happened -- to a stack that assesses risk, a stack that can be proactive about the risks [users] are seeing, a stack that allows the customers to respond and then finally remedy at-risk situations," Wagner said.
Everbridge also offers standalone products, including XMatters incident response management, which it acquired in 2021.
Everbridge has since decided to pause its acquiring of outside companies.
"Some of our complexity comes from moving really rapidly in the last couple of years," Wagner said. "[Now we're] really focusing on driving that technology into a simplified platform approach to make even more features and capabilities available for our customers."
Last week, Everbridge announced that it has integrated its risk intelligence monitoring into its physical security management system, Control Center. The integration enables organizations to take in outside risk intelligence and correlate that real-time information with data from inside their buildings, according to Everbridge.
Wagner said Everbridge will extend use of machine learning and AI. The company will also continue to invest in its team of analysts that helps customers act on information received.
GigaOm's Williams cited PagerDuty as a top competitor to the XMatters platform. Other competition to Everbridge's overall product suite includes AlertFind, AlertMedia, BlackBerry and OnSolve.
Rationale for investor's recommendations
Everbridge's "market-leading platform" is one of the reasons Ancora made its investment in the company, said Patrick Sweeney, portfolio manager at the investor. The pandemic highlighted the need for proper emergency communications and crisis management. Other uses for critical event management include severe weather and active shooter situations.
"When we look at the business and what Everbridge is trying to accomplish, we're certainly highly complimentary of the collection of assets and products that the company has assembled over the past several years," Sweeney said. "As we've seen over the past couple years, the need for corporations to keep their employees safe, their clients safe and their customers safe -- this is definitely top of mind."
However, Ancora has been disappointed in what Sweeney said is a drop in revenue growth. At the same time, Everbridge's stock has fallen from a pandemic high of about $165 a share to a range in the last couple of months of about $25 to $40 a share. Former Everbridge CEO Meredith's sudden exit after about two and a half years at the helm -- to lead integration-platform-as-a-service provider Boomi -- also hurt the company and its shareholders, Sweeney said.
In the second quarter of 2022, though, Everbridge beat analysts' revenue estimates. Revenue of $103 million for the quarter marked a 19% increase year over year.
Ancora, which started building its stake in the company in early 2022, has recommended that Everbridge seek a private equity buyer.
"Everbridge is dealing with several [issues] at the same time -- we just think the transition and transformation of the business is going to be very challenging if they remain public," Sweeney said.
Wagner said he couldn't comment on recent reports that said Everbridge is seeking a buyer. He also declined to comment on how he feels about the possibility of an acquisition.
GigaOm analysts stressed caution with a sale to private equity because of its potential hindrances to development and innovation.
"It sometimes works," Collins said. "It often doesn't."
Irvin said that when he and Brickley were co-CEOs, they met with Ancora regularly.
"We do think the company's product offering and the need they're trying to address is certainly critical," Sweeney said. "It becomes more important as each day goes by."
Wagner said he has already had about 100 shareholder meetings.
"I'm not going to talk about any individual one," Wagner said. "But I can talk about my passion for value creation with the team -- my passion to work with shareholders, listen to shareholders and incorporate their advice."