Let’s Talk Lexmark

I have to apologize that I have not been contributing to this blog recently. To be honest, besides the fact that I have been insanely busy actually selling, most recently I have been avoiding it because of the many acquisitions, rumors and bears (oh my) and I do not want to run afoul of the powers that be. I just can’t stand it anymore. It has been years since there has been this much to talk about in the ECM market and sitting on the opinion sideline is no longer an option. – Let’s Talk Lexmark  Continue reading “Let’s Talk Lexmark”

Hyland OnBase with Lexmark Perceptive Software? Say What?

4/25/17 – Update – Seems new rumors are back that Hyland may be buying the Lexmark software assets that include Perceptive and Kofax.  The rumor indicates that the purchase price will be about $1.5B.  In comparison OpenText acquired EMC’s ECD assets which included Documentum for $1.62B. 

4/30/17 – UpdateNew article with my thoughts on Kofax and other possible candidates.

My article originally published 2/22/16 is below.

Hyland OnBase with Lexmark Perceptive Software? Say What?

Rumor has it Thoma Bravo is looking to buy the Lexmark software division.  Thoma Bravo is a private equity firm that also owns a part of Hyland.  In the report it says that Thoma Bravo would be looking to merge the acquisition into Hyland.  Interesting.

First off, these are my personal opinions and not those of Big Men On Content (BMOC) as a whole, any other BMOC blogger, nor our affiliated companies past or present.  This opinion has been formulated based on my years in the industry along with what I’ve seen or heard in the news.

The ECM vendor acquisition space has been quiet and now it’s starting up again.  Xerox is spinning off BPO and EMC is part of a giant merger with Dell.  Now it’s Lexmark and Hyland?  As I stated last week, Lexmark announced it was looking to be acquired in October.  I personally thought that Lexmark would be great for Xerox, as a whole company.  Honestly, I didn’t see this coming.  So what do I think?

Caution! Slippery Conditions Ahead

I was taught some interesting lesson after the market crash of 2001.  There were a lot of candidates for acquisitions in the ECM market.  I learned a couple of key lessons.  Merging customer bases isn’t as easy as buying a competitor.  Great acquisitions are about technology and people.

Years ago, when I was doing acquisitions, I considered buying a competitor.  I quickly came to realize that you’re not immediately combining customer bases.  Customers choose their solutions based on both technology and company.   If they didn’t choose your solution the first time, it doesn’t necessarily mean that they will just happily move to your platform.  Some may even rethink their whole purchase, especially those early in deployments.  Then there is the question of what to do with the parallel platforms, because one developer can’t work on two code lines.

There’s a huge technology overlap with OnBase and Perceptive and Kofax.  OnBase as a repository is superior to Perceptive.  OnBase is mostly configuration, while Perceptive is customization.  The deployment strategy differences make this difficult.  Lexmark software also includes Kofax, which is on par with OnBase Advanced Capture and Hyland AnyDoc.  There’s really nothing new in technology here.  All this will do is leave the combined companies with two ECM platforms and three scanning platforms to integrate.

I think people are the most important part of an acquisition, because without people the technology won’t go very far.  OnBase is Miguel Zubizareta’s baby so there’s a vested interest there on the Hyland side of the house.  Meanwhile Lexmark’s Enterprise Software is led by Reynolds Bish who was CEO of Kofax.  A lot of Kofax people are driving the division.  Its two very different cultures and there’s going to be some clashes.

What if it happens?

Out of the Gartner Magic Quadrant Leaders the last two players to enter are looking to merge.  The combined company is still the smallest player, after EMC, IBM, Microsoft, OpenText, and Oracle.  But if Hyland really wanted this wouldn’t they be looking to acquire Lexmark rather than Thoma Bravo doing it for them?

As I’ve been saying a lot, Right now we will all just have to wait and see.

Xerox to Spinoff Business Process Outsourcing

After acquiring ACS back in 2010 for $6.5 billon, Xerox is changing directions and splitting off its business process outsourcing division.  It’s obvious that DocuShare will stay with Xerox.  The platform continues to hold a good position in the market.  The true outsourced scanning operations will become part of the new organization.  But what will happen to Xerox Professional Services?  And what else might happen? Continue reading “Xerox to Spinoff Business Process Outsourcing”

Proof Finding ECM Platforms is Difficult

I think most of the time, we in the industry take for granted that “everyone” knows what ECM (Enterprise Content Management) is.  If you have a document management problem, you suddenly miraculously figure out that what you really have is an ECM problem.  You then immediately discover the Gartner Magic Quadrant and you are ready to deploy.  I think that it is for this reason that there are so many vendors in the ECM space.

When I finished my first pass on Contract Management solutions for our index of ECM vendors, I found over 62 vendors.  I was amazed.  It started to show me the vast size of the small vendor space within ECM.  I wrote about this last year in “Two Guys and a Computer.”  But why is it so large?  My hypothesis is that it is hard to find the solution you need. Continue reading “Proof Finding ECM Platforms is Difficult”

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