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Sasan Goodarzi, president and chief executive officer of Intuit Inc., Feb. 25, 2020.

Getty Images Sasan Goodarzi assumed the reins at Intuit Inc. in January 2019. The tax software company had only made one acquisition worth a billion dollars in its 36 year history.| Bloomberg | Getty Images

When Sasan Goodarzi took the helm at Intuit in January 2019, the tax software company had made just one billion-dollar acquisition in its 36-year history.

Goodarzi changed the entire game plan.

Intuit announced on Monday that it’s buying email marketing provider Mailchimp for $12 billion. Nine months earlier, it closed the $8.1 billion purchase of personal finance company Credit Karma. These two companies have been among the 10 most significant U.S. tech purchases in recent years.

Intuit is well-known for its TurboTax tax products and QuickBooks accounting software for small businesses. It has now grown to be a $155 million company. This has been achieved through both internal development as well as by buying smaller startups, some of which have become core products. Intuit acquired Chipsoft, the maker of TurboTax, for $225 million in 1993, and bought budget tracker Mint in 2009 for $170 million.

Intuit’s largest deal prior to Credit Karma was the $1.3 billion purchase of online banking software provider Digital Insight in 2007. The company sold off that business six years later.

Goodarzi started his career at Intuit as an executive vice president for small businesses in 2004. He stated in an interview that he was currently working on a new strategy to expand the company before becoming CEO. He presented his plan to Intuit’s board when he was taking over his role. They had an “enormous dialogue” about the future of Intuit for the next ten years.

The company came up with “five big bets” for growth, which were focused on helping people and businesses make smarter and faster decisions with more data and better information. Goodarzi indicated that Credit Karma was the No. Mailchimp ranks No.3 in the “Unlock Smart Money Decisions” category. 4. “Be at the heart of small-business growth.”

Goodarzi explained that Intuit did experiments to find out what it could do in-house as well as how fast it could launch the critical products. Intuit would need to be competitive in the market if Credit Karma or Mailchimp are not able to catch up. Customers have no time for waiting.

Goodarzi said, “It’s all about the time it takes to get on market.” With their strengths and Intuit’s assets, we can leap forward for five to ten years.

Intuit will add significant revenue from the acquisitions. Mailchimp generated over $800 millions in sales for 2020. Its automated marketing software helps businesses reach consumers via email and online channels. Credit Karma is a credit reporting service that helps consumers find credit cards, home loans and auto loans. Intuit projects revenue to increase at least 56% this fiscal year, to $1.35 Billion.

Intuit factored Credit Karma revenue into its projection for total 2022 sales of $11.05 billion to $11.2 billion, but that was before the Mailchimp purchase.

Both of these deals will be funded using a mixture of stock and cash. Mailchimp may also have new debt. Goodarzi is getting a lot of ammunition from Intuit’s stock markets performance. Since Goodarzi became CEO, the company’s market capital has grown from $50 billion to about $155 billion.

Intuit under Goodarzi

CNBC

Mailchimp conversations started about a year ago

Goodarzi said that while he hasn’t made any dramatic changes to Intuit’s corporate development team, he has ramped up the amount of time he’s spent with Anton Hanebrink, the company’s chief corporate strategy and development officer.

Goodarzi, who was looking for Mailchimp to raise outside funds, was able call Credit Karma CEO Kenneth Lin so that he could give the owners and co-founders insight into what it is like working within Intuit.

Goodarzi expressed gratitude for Lin’s contribution to the entire process.

The conversations between the two companies started around a year ago. Intuit relied upon a product partnership that the two companies pursued and Scott Cook, Intuit’s co-founder. This was in addition to the fact that Scott Cook had helped Ben Chestnut, Mailchimp CEO, in the past. Chestnut shared his gratitude to Cook for providing him with “invaluable guidance” during years.

Goodarzi stated that Intuit was the company to first express an interest in taking over Mailchimp. Mailchimp hired Frank Quattrone’s Qatalyst Partners in order to expand discussions.

Goodarzi explained that it was a highly competitive process.

Intuit anticipates that the transaction will close in the next six-months. It will bring in approximately 1,200 new employees. This is similar to Credit Karma’s addition and it will also create a new Atlanta hub, which Mailchimp shares. Intuit employed approximately 13500 people as of the end July.

Goodarzi stated that Intuit has plans to make investments in Atlanta, despite its headquarters in Mountain View in California.

Goodarzi said that Mailchimp and Credit Karma were the best solutions to its urgent problems.

“These were crucial for us to reposition our company for the future,” Goodarzi stated.

WATCH: Intuit to acquire Mailchimp for $12 billion

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