News Analysis: Acumatica Raises $10M In Series C Funding, Aims For 1B In Revenue By 2023

R "Ray" Wang

Principal Analyst and Founder
Constellation Research

R “Ray” Wang is the CEO of Silicon Valley-based Constellation Research Inc. He co-hosts DisrupTV, a weekly enterprise tech and leadership webcast that averages 50,000 views per episode and blogs at www.raywang.org. His ground-breaking best-selling book on digital transformation, Disrupting Digital Business, was published by Harvard Business Review Press in 2015. Ray's new book about Digital Giants and the future of business, titled, Everybody Wants to Rule The World was released in July 2021. Wang is well-quoted and frequently interviewed by media outlets such as the Wall Street Journal, Fox Business, CNBC, Yahoo Finance, Cheddar, and Bloomberg. Short Bio R “Ray” Wang (pronounced WAHNG) is the Founder, Chairman, and Principal Analyst of Silicon Valley-based Constellation Research Inc. He…...

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New Funding Round Fuels Road Map And Geographic Expansion

On November 18th, privately held Acumatica announced Series C funding from Runa Capital and Almaz Capital.  The  Kirkland, WA based Acumatica, has been quietly providing its partners a customizable, cloud-based ERP and CRM development platform for the SMB market.  Acumatica’s previous rounds were funded by Visma (a KKR company) and Almaz Capital (backed by Cisco).  The announcement is significant because Acumatica intends to:

• Expand its partner base into new markets. Acumatica currently has offices in Washington DC, Singapore, and Moscow.  Through affiliates, resellers, and partners,  Acumatica is present in the US, Canada, Mexico, UK, Nordics, The Netherlands, Africa, Middle East, India, and Southeast Asia.  Sales come exclusively from partners.  Thus, the company intends to recruit more partners for high growth markets such as Asia and Latin America.  European expansion will focus on a replacement ERP market of aging systems
  
  Point of View (POV): Early success with Acumatica has come from the ease of use and functional footprint that accelerates a partner’s ability to take a solution to market.  However, future growth will require the leadership team to increase its investment in brand awareness and partner enablement.  Expect key hires in partner sales, support, and R&D.  Given the limited number of qualified partners in the market, Acumatica will have to convince partners from competitors to switch.  Early indications show this market traction.  In fact, since August 2013, Acumatica has added 50 partners, bringing the total to 270.

• Invest into new product offerings. The current offering supports a choice of deployment options including on-premises, hybrid, and cloud. Key functionality includes a financial management, project accounting, distribution management, customer management, and development tools for partners.  The core partner offering is Acumatica Studio, an ISV and OEM development platform.  The platform allows for visual, functional, and database customizations.  Partners can also utilize dashboards, integrated reporting engines, and report designers to create customized dashboards for customers.  An early set of content management tools include a business wiki, file management, and website management capabilities.
  
  (POV): From attending the 2013 partner summit, customers can expect greater investment in the mobile platform including native support for various platforms.  Other areas include expanded Office 365 integration, portal improvements, advanced workflow for ERP and CRM, and early HCM functionality such as payroll and workforce management.  Success will also require Acumatica to orchestrate how verticals and micro-verticals enter the marketplace.

The Bottom Line: SMB Customers Have A New Option To Consider For ERP And CRM

Founded in 2007, Acumatica has grown from the grass roots by delivering a solid product.  Today constant innovation of the core platform and careful curation of specialized partners in industries and geographies for last mile delivery has been one pillar of success.  The future requires strong funding to continue growth into new markets, product innovation, and brand awareness.

Continual funding is one proof point that Acumatica is building a solid foundation for growth and demonstrating not only partner traction, but also market success.  While both Almaz Capital and Runa Capital are specialized in helping entrepreneurs and start ups succeed, the next milestone that matters will come from the number of customers live on Acumatica.  Given the constant need for more specialized solutions in the SMB space, this task may not be too daunting in the quest for 1B in revenue by 2023.

However, the real benefit of this funding is market choice.  Acumatica’s success is good for customers and prospects.  The market now has a viable option in a rapidly consolidating SMB and enterprise software market.

Your POV:

Are you looking at ERP and CRM replacement? Do you need specialized requirements for your industry?  How are you doing this today? Add your comments to the blog or reach me via email: R (at) ConstellationR (dot) com or R (at) SoftwareInsider (dot) com.

Please let us know if you need help with vendor selection efforts.  Here’s how we can assist:

• Vendor selection
• Implementation partner selection
• Connecting with other pioneers
• Sharing best practices
• Designing a next gen apps strategy
• Providing contract negotiations and software licensing support
• Demystifying software licensing

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Reprints

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Disclosure

Although we work closely with many mega software vendors, we want you to trust us. For the full disclosure policy, stay tuned for the full client list on the Constellation Research website.

* Not responsible for any factual errors or omissions.  However, happy to correct any errors upon email receipt.

Copyright © 2001 – 2013 R Wang and Insider Associates, LLC All rights reserved.
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Salesforce1 - What You Need to Know Now webinar recording

Today we presented the webinar, "Salesforce1 - What You Need to Know Now". Please find the webinar recording below. The deck for this webinar is also available for download here. Additional resources below.

With so much hype swirling around Salesforce1, it's difficult to filter out the noise and get the information you really need to make the best decisions in regards to this development. Constellation Research, the original disruptive technology analysis firm, tamed the buzz and cut through the hype to deliver the critical information you need to know about Salesforce1.

Highlights:

• Implications - customer experience, apps, collaboration, Internet of Things
• Is Salesforce1 a platform? - Analysts debate
• Salesforce Chatter
• The "Inclusion Layer" - new technologies enable effective MDM, a reason to not categorize Salesforce1 as a platform?
• Recommendations - how to take advantage of Salesforce1

Download the deck

Speakers:

• Elizabeth Herrell
• Holger Mueller
• Alan Lepofsky
• J. Bruce Daley
• R "Ray" Wang
• Joseph A. di Paolantonio

Resources:

• “Inclusion Layer Products Enter the Market: New Class of Software Promises to Create Better Apps and Reduce Maintenance”

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• Salesforce.com introduces Salesforce Identity
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• Salesforce 1 Touch Service Enables Products Not People to Report Problems.
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Matrix Commerce: Tackling the Evolving Ecommerce Ecosystem

Good news--the Connected Enterprise recordings are out! I'll highlight one new recording from Constellation's Connected Enterprise every day. Don't miss out on all the technology adoption tips, disruptive business models, actionable recommendations, and inspiration.

First up: Matrix Commerce Visionaries.

The Visionaries series features well established practicioners and thought leaders operating within the realm of Constellation's business research themes.

In this video, three executives discuss Matrix Commerce and how their companies are tackling the rapidly changing commerce ecosystem.

Panelists:
Andy Lloyd, General Manager, Commerce, Netsuite
Jason Maynard, Managing Director, Software Analyst, Wells Fargo
Mike Ni, CMO, Avangate

Matrix commerce (TM) is the fusing of demand signals and supply chains in an increasingly complex world of buyers seeking frictionless buying experiences.  Friction in this new world originates from new regulatory requirements such as sustainability, taxation, and privacy.  
As the world revolves around the buyer, channels, demand signals, supply chains, payment options, enablers, and big data will converge to create what Constellation coined in 2011 as Matrix Commerce.  Matrix Commerce spans across disciplines as people, process, and technologies continue to transform today's commerce models. More about Matrix Commerce https://www.constellationr.com/content/matrix-commerce

Join us at Constellation's Connected Enterprise 2013 #CCE2014 October 29, 2014 - October 31, 2014 at the Ritz-Carlton, Half Moon Bay. Learn more and submit your request here: https://www.constellationr.com/content/connected-enterprise

Getting Social with Siebel #1: Supporting Real World Scenarios

Constellation Research

J. Bruce Daley is a former vice president and principal analyst at Constellation Research, Inc.  , Title: Big Ideas Age Before Beauty Before there can be a wholesale conversion to the Cloud legacy applications must be converted. This will take decades and not every vendor has taken this obstacle into account when projecting growth. Professional Services Firms Need a Recurring Revenue Model The services business has a lot of advantages but one big disadvantage in that you are always going out of business. Some organizations are using the Cloud to offer clients new ways to spend money than just time-and-materials or fixed price projects. ...

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Jim Moran Joins North Bridge Growth Equity

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J. Bruce Daley is a former vice president and principal analyst at Constellation Research, Inc.  , Title: Big Ideas Age Before Beauty Before there can be a wholesale conversion to the Cloud legacy applications must be converted. This will take decades and not every vendor has taken this obstacle into account when projecting growth. Professional Services Firms Need a Recurring Revenue Model The services business has a lot of advantages but one big disadvantage in that you are always going out of business. Some organizations are using the Cloud to offer clients new ways to spend money than just time-and-materials or fixed price projects. ...

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Jim Moran, who sold his company edocs to Siebel Systems in 2005 ,  has joined North Bridge Growth Equity as General Partner.   North Bridge Growth Equity has two funds with more than $1.1 billion of capital having just closed its second fund in October with over $580 million in commitments.

In this role he will be responsible for sourcing and vetting deals.  At edocs Moran was a Co-founder and Executive Vice President.

Before joining North Bridge, Moran was the CEO of Covergence, a developer of software-based session border controllers. In 2009 he orchestrated the acquisition of the company by Acme Packet, now part of Oracle generating a 6x return for North Bridge.  Additionally, Moran was an early investor, board member & Chief Operating Officer of Virtusa (NASDAQ:VRTU). Earlier in his career, Jim played a key role in Checkfree Corporation’s early growth driving revenues from approximately $25 million to over $250 million and a successful IPO in 1996.

Supply Chain Management in the Era of Social Business

President, Computer Economics and Strativa, Inc.
Computer Economics and Strativa, Inc.

Frank Scavo is skilled at formulating and communicating IT strategy, developing the business case for new systems, and facilitating the selection of enterprise systems, such as ERP, CRM, and supply chain management. He is also an expert in benchmarking IT spending and staffing levels for end-user IT organizations. Frank was one of the first tech bloggers, beginning in 2002 with his launch of the Enterprise System Spectator providing independent analysis of issues and trends in enterprise applications software and the strengths, weaknesses, advantages, and disadvantages of the vendors that provide them. Frank has been quoted as an IT expert in numerous business and industry publications such as the New York Times, Wall Street Journal, Computerworld, CIO Magazine, ZDnet, eWeek, Datamation,…...

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Applications of social networking are easy to see in the business-to-consumer space, in functions, such as sales, marketing, and customer service. But is there also a role for social tools in heavy back-office B2B processes? At first glance, the applications may not be apparent. But when the word “collaboration” is substituted for “social,” we can see that B2B organizations made use of these technologies long before the word “social” came into vogue. Think Lotus Notes, for example.

Nevertheless, the opportunities for social business are growing, and nowhere do I see a greater need than in supply chain management, specifically planning systems.

Most supply chain planning (SCP) systems today are not social. Rather, they are oriented around the job of an individual planner, who works with user interface that strongly resembles an Excel spreadsheet. Rows show demand and supply, with columns indicating time periods, left to right, marching into the future. Highlighting is used to indicate periods where there are shortages of resources, whether material, capacity, or other elements of production. Exception messages alert the planner to take action. Except for better graphics, the user experience is not much different from that of MRP systems that I worked with and taught in the 1970s and 80s.

What’s Wrong with Spreadsheets?

The spreadsheet paradigm has survived for decades because it does have its strengths. First, it is familiar to anyone trained in principles of supply chain management. Second, it allows a lot of information to be conveyed on a single page.

The issue comes in the “take action” part of the planner’s job, especially when an action affects other participants in the supply chain, such as customers, suppliers, or sub-contractors. For example, a planner may be trying to resolve an issue with a late order. Taking action in this case might mean paying premium freight to expedite a supplier order, rescheduling production, shorting another customer, scheduling overtime, or any number of exceptional actions. The problem is that such decisions can rarely be made by a single individual. They require collaboration and approval by various other players inside and outside the organization. At this point, the planner turns from the SCP system and picks up the telephone, sends an email, or convenes a meeting.

Traditional SCP systems are good for identifying the problem, and they are good for recording the decision. But they are not good as a platform for collaboration to discuss the problem and to make a decision. Supply chain collaboration is not simply a matter of “getting approval.” These are content-rich collaborations, often requiring analysis of what-if scenarios and tradeoffs between competing metrics and objectives.

In other words, today’s SCP systems are systems of transactions, not “systems of engagement” (to use the term coined by Geoffrey Moore).

What Does Social SCP Look Like?

I got a little insight into what the next generation of SCP systems might look like, when I attended the Kinaxis user conference last month in Scottsdale, AZ.

By way of background, Kinaxis provides a supply chain planning system, dubbed Rapid Response. The company was founded in the early 1990s and has been through several name changes, most recently from Webplan to Kinaxis in 2005. Kinaxis was developing in-memory software long before in-memory became an industry buzzword. The firm also moved to a cloud delivery model in the late 1990s, around the same time that Salesforce.com and NetSuite were starting out. Kinaxis has been successful selling into large companies with complex supply chains and competes directly against SAP, Oracle, as well as other best-of-breed specialists that vie for this market.


During the half day of analyst briefings, Kinaxis executives put up some screen shots of a new user interface that the company is considering. Although they did not use the word “social” to describe their objectives, I immediately saw the embedded social aspects of the new user interface.

• Automatic team selection. In a large organization, it is not always readily apparent who needs to be involved in a certain supply chain decision. Knowing who should be involved on the customer and supplier side can be even more difficult. The prototype role-based dashboard automatically tells the planner or other user who needs to be involved—inside and outside the organization—in deciding each proposed action.
   
• Business intelligence in context. For each supply chain decision needed, the demo UI allows each participant to see the impact of the proposed action on the business and on other people. So, there’s no need to leave the application to look up relevant information. In this way, the system promotes cross-functional alignment and consensus.
   
• System of engagement. The new UI does more than just record the transaction. It captures team voting, comments, and assumptions, which are traditionally done outside the formal system. 
   
• Cross-device access. No more waiting until you get back to your desk. The new UI automatically reformats itself across desktop, tablet, and smart phone displays, allowing access anywhere, any time. Going beyond the Apple/Google operating systems that many vendors support, Kinaxis also supports Blackberry and Microsoft mobile platforms.
   
• Light gamification. When the team arrives at a decision for a given case, the alternative scenarios fall off the display, like sticky notes falling from a whiteboard, and the word “Closed” is stamped on the case—a little visual reward for resolving the case. Though I didn’t see it in the demonstration, I can envision a leader board for each functional group, showing number of cases resolved and other metrics that the organization deems important.

Embedded Collaboration vs. a General Purpose Tool

To be fair, Kinaxis is not the first to seek application of social business principles to the supply chain. However, most attempts thus far have involved general purpose tools, such as Microsoft’s Sharepoint or Yammer, or Salesforce.com’s Chatter to capture collaboration among trading partners. There has also been talk about the use of social media sites such as Twitter to monitor or rapidly communicate events that may affect availability of material, for example. But these just scratch the surface of what is possible.

But, using a general purpose social tool requires the planner to use one system for planning and another for collaboration, with little or no connection between them. So, when supply chain professionals are in the planning system, they can’t collaborate, and when they are in the collaboration system, they can’t plan.

In contrast, the social business capability being considered by Kinaxis is not some general purpose activity feed layered on top of the application. Rather, it is embedded in the application itself. The automated team selection solves a real problem in large complex supply chains. The discussion thread is natively embedded as part of the application and is focused on specific decisions to be made. There are no side discussions about pet cats or who’s bringing what to the company picnic. If those things are important, let them be relegated to Chatter or Yammer and keep the SCP discussion focused on taking supply chain actions.

The prototype coming out of the lab at Kinaxis gives a clear view of what is possible in in putting social business constructs into supply chain planning. It helps that Kinaxis has built a complete SCP solution from top to bottom as a single system, as opposed to building it up from acquired components. With a single in-memory system, Kinaxis can more readily provide all the information at the same time to all participants. There is no cascading of plans sequentially from one level to another: all levels are planned concurrently.

Does this mean that SCP vendors need to give up the spreadsheet paradigm? Not at all. My advice would be for vendors to continue to use the spreadsheet user interface. As I noted, it does have its benefits. But the “social SCP” paradigm needs to be introduced alongside the spreadsheet. In this way, long-time SCP users can continue to work with the interface they have grown up with, and at the same time, be introduced to a different paradigm. User interface changes can be quite unnerving for long-time system users. A parallel approach will make the transition easier.

You can watch the full video of the prototype user interface by clicking the graphic below (free registration required).
 

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Cisco, Dell, HP, IBM, and Oracle– Who is capable of a business turnaround?

Founder, capioIT
calitolIT

Phil is the founder of capioIT, a research analyst firm focussed on driving change in the analyst and research market through innovation and collaboration, with a strong focus on IT services and BPO strategies in the Asia/Pacific region. He has 17 years' experience in corporate strategy, consulting and market intelligence, gained in a diverse range of organisations and industries. Prior to founding capioIT, he established the Australian and Services business units at Springboard Research. Prior to Springboard Research, Phil was responsible for driving analyst firm IDC's research in the services marketplace across the Asia/Pacific region. During his 6 years at IDC, Phil led a large multi-national team of analysts across a range of IT related services with a particular focus on IT…...

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The speed of transformation of technology buying as organisations globally embrace the cloud, change their device buying in the shift to mobility and the “Business” has a greater say in technology expenditure has been incredibly profound and underestimated by all and sundry.

As a result of this, key providers in the market are under considerable pressure. A quick review of the quarterly numbers of the five largest data center and hardware infrastructure providers highlights the pressure that these firms are under. The pressure is not just for one quarter. For most, particularly those selling commoditised server or personal devices, this pressure has been constricting for multiple quarters.

In the last reported quarter for Cisco, Dell, HP, IBM and Oracle, results were very mixed. The following challenges were reported upon

• Cisco – A flat FY14 Q1, with a decline forecast in Q2 of 8-10%
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Clearly these are difficult numbers and across a range of technology areas from consumer devices to storage. What it highlights is that there is massive need for a turnaround at these organisations. Some will look to asset disposal, (IBM as the prime case), Dell has changed its ownership structure and Cisco has had to take a Mea (maxima) Culpa on its strategy in markets such as China to attempt to stem challenges.

The clear question is who of these five vendors is best placed to turnaround the business. Of course all want to, need to and will do everything to transform. As anyone who has faced it knows, massive business transformation is difficult to do in public or private. It takes massive amounts of executive bandwidth, patience which is not always available and a lot of pressure on employee morale as jobs are cut and benefits pruned.

Cisco and Oracle may struggle with the turnaround because; to be frank it is not something they have had to do often before. Oracle is the United States of companies. It is a group of tightly delineated firms connected from east to west with a common President, but with as much variance and independence as New York to Alabama in terms of culture and alignment (think Peoplesoft to Sun, to RightNow). It is perhaps comforted by the fact that the Infrastructure and hardware business is not the core of what Oracle provides customers.

Dell has chosen to turnaround in private. This of course has many strengths and weaknesses. Personally I am a fan of firms being able to transform in a private ownership model, but I do not believe that Dell has yet shifted enough from selling products to selling solutions.

My money is on IBM and to a lesser extent HP. Whilst both are far from flawless, they have been on major transformations before. HP absorption of Compaq was largely successful and had a number of turnaround elements. Clearly IBM had a near death experience before reinvention as a software and IT services firm in the 1990’s. It has the strategy through analytics, and “smarter” services to shift towards, it just needs to make the tough decisions to transform. These decisions will be made across the board. It is no guarantee of success, far from it, but given the massive challenges faced, it can have some confidence that it has seen this pressure off before.

Clearly 2014 is critical. We will have a good idea in 12 months as to who has transformed most successfully and who runs the risk of irrelevance and obsolescence.

Ash Donaldson – Predicting Irrational Decisions

Gavin Heaton

Founder
Disruptors Co

Gavin is the Founder of Disruptors Co, one of Australia’s leading independent strategy and innovation companies. Gavin advises firms on strategy, marketing, product development and innovation. He is also a member of the Orbits program, the influencer network of award winning analyst and advisory firm, Constellation Research. Gavin advises boards and leadership on innovation strategy, marketing, data-driven product development and corporate venturing. Gavin is on the board of Vibewire, a youth-led social enterprise based in Sydney, Australia and on the Technology Advisory Group for Good2Give – the workplace giving platform. ...

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I don’t know about you, but I am completely logical. Focused. Directed. I am completely in charge of my own decisions and behaviour.

Or so I thought.

A couple of weeks ago, I caught up with Ash Donaldson, caffeine aficionado and behavioural design guru. We got talking about mobile app design and human behaviour and within seconds, my head was swimming. He was connecting dots that once swirled around my head like stars in the night sky. With a few quick examples, he explained how – through design – we can predict someone’s decisions.

And if you are interested in understanding how this might work in practice, take a look at Ash’s webinar on Slideshare. It’s 10 minutes that may just change the way you plan your marketing. And it may just change the way you think about your own choices that you think you make.