Josh Pigford had built a business that other founders might have envied. Baremetrics had more than 1,000 customers. It helped subscription companies understand their numbers. Yet its creator wanted to spend his time making things, and running the company increasingly meant managing people. In November 2020, Xenon Partners bought Baremetrics for $4 million. The interesting part was the permission implicit in the transaction: a useful company could continue without its founder continuing to do a job he no longer wanted.
The story in 30 seconds
- Xenon buys software businesses and helps run them.
- Founders get a route to exit; customers keep using the products.
- The hard part is transferring the work, knowledge, and keys.
That is the opening Xenon occupies in software investing. The product works. Customers care. The person who started it needs something to change. A buyer willing to operate the business can make a very different offer from an investor asking the founder to keep climbing.
01The buyer who brings a team
Xenon acquires and operates early and mid-stage technology businesses, particularly business-to-business software sold by subscription. Its website describes expertise in growth marketing, sales, design, engineering, and operations. Those functions matter because a small software company can have a sophisticated product and an improvised business wrapped around it.
Its LinkedIn description makes the method more concrete: an internal growth team supports marketing, demand generation, and sales execution; finance and administration centralize the back office. The stated preference is for self-service distribution, decisions informed by data, and inexpensive sales methods. The economic logic is straightforward: improve how an existing product reaches and serves customers without rebuilding every business function from scratch.
Founder Jonathan Siegel came to this work with experience creating software businesses, including RightSignature and RightScale. In a 2022 Acquire.com interview, general partner James Crennan described an early transaction involving Exceptional, a business whose owner was also developing Intercom. Taking over the established company freed attention for the newer one. Xenon’s opportunity begins where the founder’s priorities diverge from the product’s remaining possibilities.
“do what you say you’re going to do”
James Crennan · Acquire.com interview, 2022
02Four million dollars. Three payments.
Baremetrics makes the trade tangible. Pigford disclosed an approximately 2.65-times annual recurring revenue multiple, no earnout, and payments at closing, 12 months, and 18 months. His take-home was $3.7 million. A cash purchase can still involve waiting for the cash.
An earlier buyer had disappeared after months of diligence. Reporting by They Got Acquired puts the legal bill for that failed attempt at nearly $20,000. Xenon offered something Pigford valued: a defined personal outcome. The pandemic had sharpened his awareness of the management burden, even as growth improved. Better sales had not made him enjoy being the manager.
The agreement also required cooperation beyond buyer and seller. General Catalyst and Bessemer wrote off their combined $800,000 investment, while $300,000 of the purchase price went to the team. A founder’s satisfying exit can coexist with an investor’s loss. That distinction matters when someone calls a deal successful.
$4,000,000
Baremetrics purchase price
03The portfolio has a day job
Consider what Xenon actually buys. MetricFire, acquired in 2019, monitors infrastructure and applications using tools including Graphite and Prometheus. Its acquisition announcement named Nielsen and Playtika as customers. This is software for people whose workday gets unpleasant when systems stop behaving.
UXPin, acquired in June 2020, addresses a different irritation: the distance between a designer’s intention and a developer’s implementation. Its collaborative prototyping platform already served thousands of teams, with Apple, Netflix, and PayPal among the users named in the announcement. These are customers of the portfolio company, rather than a list of Xenon’s investment clients.
The distinction helps explain the model. Founders meet Xenon as a possible buyer; end users meet the software brands as products. Xenon’s portfolio spans monitoring, design, subscription analytics, and other practical tools. Ownership sits above those products. Their usefulness still has to be earned separately, one customer at a time.
04Sometimes the asset is the people
Treehouse stretches the story beyond conventional B2B software. Xenon acquired the coding education business on December 14, 2021. In his introduction as its new CEO, Jason Gilmore singled out a quality that software investors sometimes find inconvenient: human support.
He described students getting help through community discussions, Slack, and individual Zoom calls. Treehouse had laid off staff before Xenon’s involvement. By March 2022, Gilmore said the team had more than doubled in the preceding three months and was hiring instructors. That is a specific, dated operating change, rather than a promise that every acquisition produces the same result.
The handover pattern appears again at Sendspark. In January 2026, investor CS Angel announced its acquisition by Xenon. Co-founders Bethany Stachenfeld and Brandon Escalante would remain advisers, while Abe Dearmer became CEO. Stachenfeld said the personalized-video company had served more than 10,000 customers over seven years. The founders could change roles while someone else took responsibility for the next chapter.
05Before buying it, try running it
The most useful thing to copy is almost comically practical. In his technical diligence guide, Xenon partner Jason Gilmore says someone on the buying team must build the development environment locally and deploy to production before an acquisition proceeds. Reading the code is insufficient. The buyer needs to prove it can operate the thing.
His checklist also covers architecture, intellectual property, third-party dependencies, credentials, and security. He puts a typical professional penetration test at $5,000 to $20,000 and one to four weeks once scheduled. Those are his experience-based estimates. They make the cost of checking a small software business visible before the celebratory announcement.
The limitation follows from the method: inaccessible credentials, obsolete infrastructure, or indispensable knowledge trapped with a departing founder can make a handover expensive. An operator cannot distribute a product successfully simply by signing for it.
06Who takes the work off your desk?
Xenon itself uses that logic. A Carta customer story describes fund administration diverting attention from deals; Xenon outsourced administration and valuations to get that time back. A December 2020 SEC filing for Xenon Investment Fund 5 reported $35.4 million sold and an annual management fee tied to committed capital. Fund commitments finance investing; they are different from software subscription revenue.
Buyers such as saas.group and Scaleworks also acquire software businesses. Xenon’s distinctive pitch is the willingness to put operators into the work, including situations where a founder needs an exit. For a reader considering the same path, the practical question is who will own the Monday-morning responsibilities. A valuation starts the conversation. A credible handover makes it possible.