Wednesday, July 27, 2005

BroadVision acquired

How nuts were people during the Web boom? Well, I found a Wired Magazine article from June 2000 that listed BroadVision with a market cap of $6.7 billion. And I'm not even sure that was the height of the Web boom. You probably saw the company was recently sold for $45 million. What happened?

Monday, July 18, 2005

"Like a Rocket"

This article is kind of fun to read. It's from the Spet. 17, 1997 issue of DIR, about six months before I took it over. I looked it up after I heard that Captiva was closing its Waltham, MA, offices - which represented the headquarters of recognition specialist Symbus. I believe this was Reynolds' Bish first forms processing-related M&A activity.

This article discusses the FormWare/Symbus merger. Recognition industry guru Arthur Gingrande actually co-founded Symbus but doesn't receive any credit in this particular piece. We do get great stuff however, like Jim Woodruff of Wheb Systems estimating the potential of the forms processing market to be $5 billion. And Reynolds with the great "The market is going to take off like a rocket." There's also something in here from Dan Elam about saying everyone is going to sell out or go public in two years.

Anyhow, it's some pretty fun reading - just please nobody go pulling out any of my old columns...

Cheers.

RG
FROM DIR - Spect. 17, 1997

CONSOLIDA TION BOOSTS FORM PROCESSING GROWTH Recent Deals Only A Start, Analysts Predict

The desire to pool resources and wrest greater market share has led to a spate of mergers and acquisitions in the document capture market. The business dealings of the past month such as the one that created FormWare Corp. through the merger of Park City, Utah-based TextWare Corp. and Symbus Technology Inc. of Waltham, Mass. - are only a start.
"We're on the threshold of the industry starting to congeal," says Herb Schantz, president of Sterling, Va.-based HLS Consulting. "Good little guys are going to bond together to form good big guys."
Analysts and vendors believe there is huge market potential for software that collects data from scanned forms and delivers it to another application.
Creating user-friendly applications is the key, vendors say. Consolidation will give smaller vendors the financial muscle to develop easy-to-use products. "Virtually all the independent market either have plans to be bought or go public within 24 months," says Dan Richmond, Va.-based analyst with IMERGE Consulting."

Small Players, Big Market
Jim Woodruff, vice president of marketing at Wheb Systems, estimates the potential market for forms processing software is $10 billion, even though systems being sold today equal about 5 percent of that - or $500 million.
Such predictions cause TextWare President Reynolds Bish to declare, "The market is about to take off like a rocket."
But Schantz advises the market won't grow without continued consolidation. Merging allows companies to assign engineers to more diverse projects, which results in greater product offerings and the ability to purse more vertical markets.
Look for continued consolidation among companies selling products such as scanners, optical character recognition engines, preprocessing or postprocessing software. Even small system integrators will be active, Schantz says.
For instance, in addition to the TextWare/Symbus merger, the Sterling, Va.-based Star Technologies last month bought the assets and products of the Potomac, Md.-based postprocessing software developer Intrafed (DIR, August 6, p. 8). Last week, Xionics Document Technologies [XION] of Burlington, Mass., bought Seaport Imaging of San Jose, Calif.
"It is a huge market with dozens of players competing in regional markets, Schantz says. "If nothing is happening in a region in a year, [the regional companies] almost dry up."

Matching Strengths
"The combined company has greater resources - people, products and capital - to better execute its business plan and respond to the needs of the marketplace," Bish says. "Historically, forms processing is a lot of little companies and no one has been able to get large enough to get 'critical mass.'"
For example, by expanding its number of executives, a company's officers can focus on areas of expertise. Similarly, the company has doubled its software development arm.
"At TextWare we always focused on providing usable applications as opposed to providing tool kits or technology that requires integration services. Symbus focused on technology," Bish says. "Their technology with our usability focus - you end up with powerful and competitive products in the marketplace."

Of the TextWare/Symbus teaming, Elam notes, "Textware has only recently emerged as a strong enough player to challenge for significant market share, so Symbus will help bolster them ... for more complex systems."
"In a year or so, [TextWare] is probably the only company that has a
realistic chance of going public and doing well," he adds.
The heads of the small companies also are anxious to see a return on their
years of effort, Elam says.
With the exception of a few larger vendors that sell shrink-wrapped, prepackaged systems, most companies bring in less than $10 million a year in revenues, he says.
"Most of these are entrepreneurial companies with guys ready to get their money out," Elam says. Also, larger companies can draw more attention to a brand name - which in turn can give vendors more leverage with system integrators, he says.

Simple Solutions
To grow, companies must focus on creating systems that are easy to install and use.
There are few differences in the performance of recognition
technologies, Bish says. The competitive advantage now lies in added value a firm packages with the recognition technology.
"Forms processing still requires a great deal of customization on an installationto-installation basis," Bish says.
"Over time, we need to not only make the technology more affordable, but focus on making it easier to use, reducing the need for customization. [The market] is not to that point yet."

Focusing On Benefits
Woodruff suggests growing the forms processing market is largely a matter
of promoting the practical benefits of the technology.
"The imaging market is way too technology-centric," he says. Vendors need to go from talking about how many characters a minute their products handle to describing how much money customers can save by using the software. "I expect packaged products to prevail over component approaches," he adds.
A consolidation trend would be good for the forms processing market, Woodruff says. Although he considers San Diego-based Wheb Systems a large business, he agrees many of the players are small. While, bigger companies would attract big clients, a Citibank-sized company would have a hard time doing business with a small, regional operation, he says. Major players will focus on different types of users by creating industry-specific products for markets.
(Reynolds Bish, TextWare, 801/645-9600, http://www.textware.com; Dan Elam, IMERGE Consulting, 804/342-7400; Mary Beth Poggi, Unterberg Harris, 212/5728078; Herb Schantz, HLS Consulting, 703/444-7037; Jim Woodruff, Wheb Systems, 619/586-7885, http://whebsys.com.) 8






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Thursday, July 14, 2005

Enterprise Input Management

Captiva’s Digital Mailroom application was probably the first example of the company’s future direction. At the company’s recent Capture ’05 conference, the maturing and growing input management vendor further detailed its efforts at becoming an enterprise aplication players. More on this in our next issue, which should be out early next week.

For subscription info, please contact me at ralphg@documentimagingreport.com

Thx,
RG

Thursday, July 07, 2005

SourceCorp

Hope your Independance day celebrations went well. Just saw this piece of news regarding SourceCorp. A bit disturbing as SourceCorp is one of the few pure-imaging service bureau roll-ups from the late 1990s that has had some success. Granted, there have been a few bumps, but nothing like those encountered by competitors ImageMax and Lason. And right now a lot of people are trying to get into the business that SourceCorp is in. Of course, this might mean that somebody big wants to buy them, which may be the reason why all this posturing is going on. Anyways, here's hoping they can pull through this without too much of a mess.

Cheers.

RG