M&A: Sustainable Building Specialist BrainBox AI Acquires Turntide Technologies' Automation Division

BrainBox AI, which develops cloud-based, autonomous technology to make commercial buildings smarter, greener and more energy efficient, has acquired the Automation Division of Turntide Technologies. Financial terms of the deal were not disclosed.

This is M&A deal number 205 that Sustainable Tech Partner has covered so far in 2024. See all M&A deals involving sustainability, climate tech and green IT services listed here.

BrainBox AI, founded in 2017, is based in Montreal, Quebec, Canada. The company, led by CEO Sam Ramadori (pictured, top of page) had 172 employees listed on LinkedIn as of May 29, 2024. The firm develops autonomous building technology to improve the performance of HVAC (heating, ventilation and air conditioning) systems.

BrainBox AI's technology can reduce customers' total energy costs up to 25% in less than three months, with low to no CAPEX needed from property owners, the company asserts.

BrainBox AI works with technology partners and systems integrators to support customers in such sectors as hotels, commercial retail, grocery stores, airports and more. For example,  Will Solutions and BrainBox AI are partnering in Quebec and Ontario, Canada to promote artificial intelligence (AI) for HVAC systems across sustainable communities.

This is BrainBox AI's second acquisition in the past 12 months or so. In May 2023, the company raised $20 million and acquired a multi-site retail (MSR) energy management system integrator.

Why Did Turntide Sell Automation Business? Some Clues...

Turntide's automation business spans more than 1,900 connected buildings across North America and Europe. Key customers include Fortune 500 retail and banking companies, according to the M&A announcement. We don't know how much revenue the automation business unit generates.

The overall Turntide company develops sustainability technologies that drive down energy consumption and operating costs in buildings, agriculture and electric transport. Turntide raised $80 million and achieved unicorn (a $1 billion+ valuation) status during the height of venture capital investing in the first half of 2022. The company's total funding to date at that time was $485 million.

Still, the unicorn glory was short-lived. Amid rising interest rates and VC priorities shifting from growth to profits, Turntide layoffs arrived in the second half of 2022. Founder and former CEO Ryan Morris departed in October 2023. Mark Cox has been Turntide'is interim CEO since that time, according to his LinkedIn page.

Executive Perspectives: Why BrainBox AI Acquired Turntide's Automation Division

Fast forward to May 2024. Turntide is now selling a piece of its business -- the Automation unit -- to Brainbox AI. It sounds like Turntide will now focus its remaining businesses on electric motors, power electronics and electrification solutions for industrial, off-highway and commercial applications.

In a prepared statement about the deal, BrainBox AI CEO Sam Ramadori said: “Our latest acquisition sets an important tone for the industry. It marks a significant inflection point where two climate tech innovators, align over their shared mission to fight global climate change. Growth is a critical driver for success. As Turntide Technologies fulfills its business objectives, we recognize the synergy that this opportunity creates to accommodate their vision and ours. We hope to be able to support their mission to revolutionize the smart motor business with their cutting-edge technology and remain supportive of their future work as we both pursue this incredibly important mission.”

Added Turntide Technologies Interim CEO Mark Cox: “Following a successful transaction, the Automation division is poised to make an even greater impact in the market as part of BrainBox AI’s growing array of solutions for the built environment.” 

Smart Buildings and Carbon Reduction: Market Forecasts

Demand for smart building solutions that reduce carbon emissions appears steady to strong, depending on which market forecast you potentially believe. For instance:

• The global building automation and control system market will reach $168.8 billion by 2031, up from $87.3 billion in 2022, Transparency Market Research forecast. That's a compound annual growth rate (CAGR) of 7.9%, the firm said.
• Spending on building management systems is expected to reach $19.25 billion in 2023, up from $6.65 billion in 2016. That's a 16.7% compound annual growth rate (CAGR) during the forecast period, according to MarketsAndMarkets. 

The U.S. government also is assisting the market. For instance, the federal government plans to spend $250 million to help federal agencies implement net-zero building projects.