Perforce acquires Puppet for infrastructure as code

Perforce Software will acquire infrastructure-as-code vendor Puppet for an undisclosed amount this quarter, in a divergence from Puppet executives' previously stated goal of an IPO.

Perforce, which is owned by private equity firms Francisco Partners and Clearlake Capital, offers enterprise support services for open source DevOps automation tools, including PaaS software from OpenLogic. Its acquisition of Puppet marks the company's 13th acquisition to date -- before this, it most recently acquired an application testing subsidiary, BlazeMeter, from Broadcom in September.

Yvonne Wassenaar

Puppet executives had previously said in late 2020 that the company was planning for an IPO of publicly traded stock, but the pace of change in the IT industry and the disruption of the COVID-19 pandemic changed that plan, according to a blog post by Puppet CEO Yvonne Wassenaar.

"As I surveyed the marketplace it became clear we are only scratching the surface of what our customers want and need," Wassenaar wrote. "What they need is not a plethora of tool vendors but a strategic platform partner who can offer them the breadth and depth of DevOps solutions essential to winning in the fast-changing markets they play in."

Wassenaar also acknowledged the previous IPO plans, and alluded indirectly to failing to hit the necessary financial milestones to reach that goal, despite $100 million in annual recurring revenue during her three-year tenure as CEO.

Reading between the lines, one analyst said it's clear Puppet's event-driven DevOps automation tool, Relay, had not seen enough success in the market for the company to remain independent.

"Standalone DevOps products do not provide significantly differentiating benefits to justify integrating into a toolchain," said Larry Carvalho, independent analyst at RobustCloud. "Hence, it is likely that they did not have enough revenue growth to fulfill the needs of an IPO."

The pandemic also accelerated many enterprises' moves to the cloud, where cloud providers offer their own automation tools. Some users get the impression that tools such as Puppet aren't necessary, said Naveen Chhabra, a senior analyst at Forrester Research.

"Vendors are being hammered by the shift to the public cloud, where operations [pros] feel they do not require as many automation tools as they would have needed in the on-premises world," Chhabra said. "That's a myth, though. Firms do need automation in the public cloud world ... marketing and messaging makes people believe that cloud is all managed."

One Puppet channel partner expressed trepidation about the merger with Perforce shortly after the news was announced.

Although Perforce has a track record of supporting open source software and pledged to continue supporting Puppet projects, the Puppet partner expressed nervousness about how effective that support will be.

"From my experience, being bought is rarely a positive thing in the long run," the partner said, requesting anonymity because they have yet to receive detailed information on the acquisition from Puppet. "I'm a little bit afraid that the things we came to love about Puppet [will] start to disappear in favor of the new company's policies."

From my experience, being bought is rarely a positive thing in the long run.

Specifically, the partner was concerned about losing rapport with Puppet. Some 500 Puppet employees will join Perforce as a self-contained business unit within the larger company, which has 1,200 employees.

"As a partner, we have a very close relationship with the company and the people working for them," the partner said. "Being part of a larger group might jeopardize that somewhat."