Sage Acquires Intaact

Most people in Europe would not have heard of Intacct as they have marketed their product solely in North America, but we have been aware of them for many years due to our association with Sage 300 (formerly Accpac).

A number of Accpac business partners in the US started picking up Intacct and this resulted in a few of the Accpac third party developers also starting to develop applications for Intacct.

Intacct is a fully cloud (web) ERP system for the mid-market.  The financial modules are strong but lacking in localisation for countries outside the US and Canada.  In our view the distribution modules are not as strong but they do have a good projects and services module.

Sage paid $850 million for Intacct who have annual revenues of $96m and 11,000 customers.  It is a huge price, about $75k per customer that is only bringing in $9k per year but the value is in the product and extending it to other countries, making it a strategic “pillar” for Sage.

We think that this is a very good thing for Sage users.  Up to this point the future for mid-range customers was not clear and future is important.  ERP is the circuitry of a business and its difficult and expensive to change but it needs to be kept up to date.  Before this the future for a Sage “X00” user was a slow road to the web with hybrid screens and portals running alongside the trusted old client server application.  Then there was also the puzzling “Sage Live” cloud system being developed in Ireland which would be heavily featured in annual summits in flashy demos but seemed to be a wonder child from a different family.  No-one spoke about a plan to migrate to Sage Live or mapped out a future where the X00 system would converge with Live.  And if you looked at Live from the promotional material  there was very in the way of functionality beyond the basic general ledger.

Intact should be good news for Sage users and with such a competent system in Intacct and a very high investment price and visibility, at last we should see the strategy for the remaining X00 applications.

By James Morgan, Director of Tascoli