Goleta-based tech company Curvature is merging with North Carolina-based System Maintenance Services to form what company executives say will be the largest global firm in their sector of the IT industry.
Both companies were founded in the 1980s: Curvature primarily sells networking equipment and does maintenance on networking equipment, while SMS deals with maintenance and professional services on high-end data center equipment.
“The overlap between the two companies is so small,” said Curvature president and CEO Mike Sheldon, who will become SMS | Curvature’s president and chief commercial officer.
There is overlap between about 5 percent of their combined 10,000 customers, he said, even though “the products are adjacent to one another in terms of how they’re used, who buys them and what they’re used for.”
Sheldon told Noozhawk that SMS | Curvature combine for some 2,200 employees. The companies are of roughly equal size from an administrative standpoint, though Charlotte-based SMS has many more employees — mostly its engineers and field labor force.
Gartner, an IT research and advisory firm, listed both companies as roughly two to three times larger than the next competitors in their respective sectors of the IT industry.
In addition to their similar but distinct services, Sheldon said, both companies have a presence in a number of other countries without any significant geographic overlap.
Roughly half their employees are based outside the United States.
Taken together, “we’re somewhere between four and a half and five times larger than the next-largest competitor,” Sheldon said.
The trend in the IT manufacturing industry, he said, has been away from the physical maintenance business and toward cloud-based systems and the virtual.
“Yet everybody’s still got equipment that has to be managed and maintained,” he added.
SMS | Curvature’s large field staff means it can fill in “the huge market opportunity in being the last mile of support.”
The second trend Sheldon believes bodes well for the new company is the gradual replacement of proprietary hardware with “utility, white box-type hardware,” which often lacks a support option due to its low-cost, high-volume nature.
SMS | Curvature can step in and be the support arm for companies that use non-proprietary hardware, he said.
That the two companies’ services don’t quite overlap could be good news for local, up-and-coming IT professionals.
Sheldon estimated the merger will result in the loss of around 3 percent of its workforce, but projected job growth in 2017 to “be in the hundreds.”
Dozens of people are hired out of UC Santa Barbara, Santa Barbara City College and Westmont College each year, Sheldon added.
“We think, if anything, that will accelerate,” he said. “The addition of so many new products to our portfolio will create new opportunities in sales, new opportunities in engineering, new opportunities in product management — and all the associated administrative support functions.”
Company executives expect the merger to close by the end of February. SMS CEO John Wozniak will assume that same position with SMS | Curvature.
— Noozhawk staff writer Sam Goldman can be reached at sgoldman@noozhawk.com. Follow Noozhawk on Twitter: @noozhawk, @NoozhawkNews and @NoozhawkBiz. Connect with Noozhawk on Facebook.