Private Equity-Owned D-Tools Acquires Portal; Does This Deal Make Sense for Integrators?

On Tuesday, Commercial Integrator reported that D-Tools has acquired Portal.io in a deal for which the terms were not revealed. Although the story called the deal a merger, it almost certainly was an acquisition by D-Tools, the larger of the two companies. D-Tools is majority-owned by Greybull Stewardship, a private equity company headquartered in Jackson, Wyoming. It also recently received a $12 million investment from StellarIQ, another private equity company led by John Heyman, former CEO of SnapOne.

Learn more about D-Tools acquiring Portal…

I read the company’s formal announcement with interest because, frankly, I’m always a little skeptical of acquisitions like this. Long-time Strata-gee readers will recall that multiple studies of acquisitions show that they most often fail…by a wide margin. Depending on which study you choose, anywhere from 7-to-9 out of every 10 acquisitions fail to increase shareholder value.

And I’ll admit it, this acquisition is especially suspicious to me. First, some of the details of this story… While D-Tools is acquiring Portal.io, they say that the two companies will operate independently. G Paul Hess, current head of D-Tools will continue as CEO of what is – clearly to me – the main or dominant company. As for Portal, founder and CEO Kirk Chisholm will become Chief Product Officer “…for product vision and strategy across the portfolio.” In other words, Chisholm is responsible for the product strategy for both brands.

Both Brands Operate in Different Industry Segments

Also from Portal, Josh Willits, current COO of the company, will become “head of Portal.” Funny they don’t give a formal title, such as the CEO title, but it would seem appropriate as the step up from his current COO position. Mainly, Willits’ role is to “…[continue] to lead the Portal business unit.”

The formal announcement acknowledges that both brands operate in completely separate segments of the market. For D-Tools: “D-Tools notes it has been an anchor platform for the integration industry. It earned its position by building the breadth and scale integration businesses need to bring structure, accuracy and control to their operations, across sales, system design, engineering, project management and procurement.”

D-Tools Goes High, Portal Goes Low

And, for Portal: “Portal.io has spent 15 years understanding how dealers sell and turning that insight into software they love to use. That focus has produced an intuitive proposal and catalog experience, robust customer support and a loyal customer base for the company.”

This suggests that the company views D-Tools as the high-end solution for multi-location, professionally run, large-scale integration operations. At the same time, it appears to view Portal as more targeted to the mainstream, smaller integration businesses.

Completely Different Approaches

I think it is very true that these are two very different operations. Not only do they serve completely different industry segments, but they also have completely different product offerings, style of operations, and approach to the market. They are more like distant old college buddies reconnecting to hang out, while one is single and the other is married.

To me, this seems like strange bedfellows. I have spoken to multiple dealers for both brands over the years and the difference is stark. I have even spoken with Portal dealers who were previously D-Tools users.

Both Camps Have Dedicated Fans

What dealers tell me is that while D-Tools is more feature-rich, sophisticated, and operationally layered, it is also more complicated, requires substantially more onboarding time for team members, and isn’t always intuitive, often resulting in multiple calls to support. Portal, on the other hand, is designed by an integrator for integrators…totally intuitive, simple, quick steps that get the integrator from concept to proposal in minutes…literally minutes.

Both camps have their dedicated fans…fans whose reasons for supporting the platform they have chosen are strongly held and practically diametrically opposed to those of the other camp. I do not see synergy.

To Succeed, Acquisitions Must Be Transformative

For acquisitions to have a chance to succeed, they need to be transformative. In a transformation, everything changes for both camps. A seemingly mystical alchemy leads to something entirely new being created from the acquisition…a 1+1=3, or the whole is greater than the sum of the parts. Transformation is not just simply gluing two disparate companies together in the hopes that something good will happen…maybe.

In this instance, for example, should Chisholm, as Chief Product Officer of D-Tools (the real parent company here), attempt to merge elements of each product “side” with the other, the likely result is that they will lose users, perhaps many users. That’s not transformative; it’s destructive of the core elements that drew integrators to one camp or the other in the first place.

The Justification Rings Hollow

Perhaps this is why the company’s arguments in this announcement that seek to explain or justify the acquisition, to me, feel anemic, ring hollow, or are even misguided.

“The merger brings together the largest network of integrators in the industry, running from single-operator shops to enterprise teams with hundreds of users,” the announcement boldly brags. Then it adds, “This scale gives the combined company a broader and more representative view of how integrators work, where they struggle and what they need from software, creating a stronger foundation for what it builds next.”

Those statements, near the top of the announcement, give me a clue to what the company’s real goal was in this acquisition. Neither of them describes a user benefit. Rather, both describe a D-Tools wishful-dreaming benefit.

The Most Likely Real Reason for This Acquisition: Private Equity’s Pursuit of Scale

I think that the most likely real motivation for this acquisition is the pursuit of scale – a strong and burning desire of all private equity companies. Remember, D-Tools is majority-owned by Greybull Stewardship, a private equity company that targets small businesses ($5-50 million in revenues, with under $5 million EBITDA) that “do not have access to financial capital or know-how required to scale.”¹

Greybull first took majority ownership of D-Tools back in 2016. That’s right, ten years ago. Greybull says it believes in investing in companies for the long-term. In my experience, many PE companies say this, but what they really mean is a period of about 3-5 years. I suspect that Greybull is looking for an exit – perhaps trapped in its D-Tools investment that had fallen into a low- or no-growth pattern.

Perhaps Why John Heyman and StellarIQ was Brought In

Perhaps that is why StellarIQ and John Heyman were brought in. StellarIQ made a $12 million investment in D-Tools exactly one year ago in August 2025. StellarIQ proudly proclaims on its website its participation in “multiple $1 billion business ventures.”

“Our founders bring operational expertise from successful exits at Radiant Systems, Blue Cube, and Snap One, where they transformed technology companies through strategic innovation and investing expertise.”²

Let me note for the record that SnapOne never had a positive net income under Heyman’s stewardship. However, building a profitable business may not have been the goal. Rather, scaling the business to make it attractive to sell may have been the goal. And if so, that was successful, as SnapOne was ultimately sold to Resideo Technologies and is now run by the newly independent ADI Global Distribution.

StellarIQ Brings Infusion of Fresh Capital, AI Technology, and Experience in Selling Companies

By bringing StellarIQ into D-Tools, Greybull gets a financial partner to share the load. But more than that, StellarIQ is said to have its own AI technology that it can bring to its portfolio companies. In today’s world, that AI component may be a more powerful selling factor – convincing companies or investors to partner with them – than its capital. And of course, Heyman brings his background of scaling technology companies to be sold to the table as well.

Perhaps what’s troubling me is that Hess’ pitch on why this deal makes sense (to him) – i.e., we sell to a broader group of integrators – feels very SnapOne-ish. And it comes one year after Heyman (former SnapOne CEO) joins Hess (former SnapOne executive). SnapOne sought to serve all elements of the integrators’ needs, sort of a one-stop shop. Now D-Tools serves to sell to more integrators by buying another SaaS company.

Anticompetitive Action Leads to Fewer Options for Integrators

D-Tools buys out a competitor and owns more of the segment. It is anticompetitive, reduces integrator options, and gives D-Tools greater market power…including greater pricing power. In the long run, it could lead to costing integrators more. with fewer options to turn to.

If I’m right, then this acquisition of Portal by D-Tools tactic is driving towards an exit – likely by either going public or being acquired by another private equity company. While that will undoubtedly be good news to the company’s current investors, where does that leave integrators?

We’ll have to cross that bridge when we come to it.

Two Integrators Say They Like the News

In the announcement, the company provided quotes from two integrators. The first was Everett Katzen of Springboard Automation, who said, “Bringing the Portal and D-Tools teams together gets me excited about what they will be able to build next for dealers.”

Second was Aaron Cowden of Fusion AV, who added, “Seeing these two teams come together under one roof is the best of both worlds for our business.”

READERS – What do you think? Do you see this as a troubling development? Or are you excited? Let me know by commenting in the “Leave a Reply” box below the story.

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FOOT NOTES

1. Greybull Stewardship website ↩︎
2. StellarIQ website ↩︎