US Firm To Acquire Israeli Genealogy Company MyHeritage For Reported $600M

By NoCamels Team February 25, 2021 3 minutes

The MyHeritage team, with founder Gilad Japhet in the center. Courtesy

US private equity firm Francisco Partners has signed a definitive agreement this week to acquire Israeli genealogy company MyHeritage. The financial terms of the transaction were not disclosed but Israeli media reports estimated that deal was valued at approximately $600 million.

MyHeritage offers DNA kits and an ancestry research platform to help users discover and create family trees by searching through historical documents like census, immigration, marriage, and burial records in 42 languages. In 2016, the company launched a genetic testing service that provides DNA matching, ancestry, and ethnicity estimates, and later began offering health screenings for genetic conditions such as heart disease, breast cancer, type-2 diabetes, and Alzheimer’s disease.

Last year, the company launched innovative AI-based tools for colorizing and enhancing historical photos. And with the onset of the COVID-19 pandemic in 2020, MyHeritage established a coronavirus testing lab in Israel in to help fight the global crisis, and donated thousands of its own cotton swabs (meant for genetic genealogy tests) for testing operations by Israel’s Health Ministry.

Golda Meir in Kibbutz Shefayim in 1950. Courtesy of MyHeritage — A photo of Golda Meir in Kibbutz Shefayim in 1950 enhanced with MyHeritage’s AI tools. Courtesy of MyHeritage

MyHeritage was founded in 2003 and has been backed by leading investment firms such as Bessemer Venture Partners (BVP) and Accel. It raised $49 million in five rounds of financing over the years, the latest of which took place in 2012, and made 11 strategic acquisitions.

MyHeritage currently has over 60 million users in more than 40 countries and has amassed an extensive database of 13 billion historical records.

According to Adam Fisher of BVP, an early backer of the company who has also served on its board for the past eight years, MyHeritage now “officially joins the Israeli pantheon of Consumer Internet brands alongside Wix, Waze, and Fiverr.” Fisher wrote in a blog piece titled “My Pride, MyHeritage that the acquisition announcement is not “the end of anything, but merely a way-stop in a journey that is likely to continue for many years to come.”

He praised Gilad Japhet, MyHeritage’s founder and CEO, as “one of the very few entrepreneurs who actually fulfilled the mostly foolish career guidance to ‘follow your passion.'”

A genealogist himself, Japhet said that when he founded the company 18 years ago from his home, his vision was “to make family history discovery easier using technology and to unlock the fun in genealogy: the human pursuit that bonds people.”

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“With the help of an excellent and dedicated team, years of hard work, and with constant technological innovation, we created new and exciting ways for people to learn about their origins,” Japhet said in the announcement this week.

“In Francisco Partners we see a true partner for our journey ahead, not only demonstrated by the trust they are placing in our company through this acquisition, but in their desire for us to remain true to our vision by continuing along our path and helping us do what we do best – putting our users first and giving them life-enriching, and sometimes life-changing, experiences. This move will enable us to reach new heights, invest more resources in creating greater value for our users and to reach a larger audience. We’re incredibly excited for this next chapter in our company’s evolution,” he added.

Eran Gorev, Francisco Partners’ president of Israel and senior operating partner said that “by leveraging our operational expertise, market resources, and strong industry networks, we believe Francisco Partners is uniquely positioned to help MyHeritage accelerate its vision for growth.”

“We are deeply impressed by the incredible achievements and relentless determination of Gilad, a visionary leader in genealogy who has grown the company from a start-up to a profitable global market leader,” he added. Gorev will join the MyHeritage board of directors upon the closing of the transaction.

Matt Spetzler, co-head of Europe and partner at Francisco Partners, who will also join the MyHeritage board said the company was “an ideal investment for Francisco Partners.”

“The company has proven itself to be an innovation powerhouse through its robust subscription business, unique positioning, advanced technology portfolio, and international focus that has enabled it to build a superior user experience,” Spetzler said.