Alphabet in Continuing Talks to Acquire HubSpot

Google parent company Alphabet is reportedly in continuing talks with HubSpot about acquiring that company.

The companies have discussed the potential terms of a deal, although the deliberations are ongoing, there is no certainty the two companies will come to an agreement, and another potential buyer could emerge, Bloomberg reported Thursday (May 9), citing unnamed sources.

Neither Alphabet nor HubSpot immediately replied to PYMNTS’ request for comment.

HubSpot, a provider of marketing software, has a current market value of $30 billion, according to the Bloomberg report.

For Alphabet, an acquisition of HubSpot would fill a gap in its offerings and help it compete in the small business-focused customer relationship management (CRM) market with companies like Microsoft, Oracle and Salesforce, the report said.

Alphabet began considering a bid to acquire HubSpot earlier this year. Alphabet met with investment bankers to discuss how much it should offer and whether it would face challenges from regulators.

The potential acquisition would be Alphabet’s largest ever and would expand Google’s offerings in the CRM market; create new opportunities for its cloud computing business; and provide new areas of growth at a time when Alphabet’s advertising business is facing greater competition and lower-than-expected sales.

Small- to medium-sized businesses (SMBs) — the market served by HubSpot — are operating in a new reality that requires them to not only be responsive when it comes to innovations, but to be proactive about separating the signal from the noise and identifying new opportunities, Shilpa Dhar, senior vice president and general manager of commerce at HubSpot, told PYMNTS in an interview posted April 24.

The interview was posted shortly after HubSpot announced a new partnership with financial infrastructure provider Stripe.

“SMBs on the HubSpot platform manage their sales and customer data in the CRM, and they use Sales Hub to nurture their deals,” Dhar said. “Now, if SMBs start using the Commerce Hub for payments and billing solutions, all of their data across all customers and transactions is together in one place. You have a complete view of the lifecycle.”