“Acquisitions are usually seen as positive signs for those being acquired. Somehow, this one leaves a strange aftertaste with hints of turbulent times and notes of uncertainty for EPiServer. Customers and prospects in the US market may want to speak (and by “speak” I mean “really question”) to EPi about their future plans in this geography before planning on further investments in this Web CMS vendor.”
From CMSWire: Web CMS Vendor EPiServer Acquired by a Surprising Buyer (Nov 10, 2010)
It has now been a few weeks after the change in ownership for Sweden-based Web CMS vendor EPiServer and the initial critical posting by industry publication CMSWire. Typical for this industry, the news has left many customers, including several of our members, puzzled. EPiServer was bought by a European private equity firm on November 10, but was that really a bad thing?
Here’s our take from conversations with the wider community: While competitors are naturally fast to spin tales of doom, this is actually at worst a “non-event” for prospects and customers, but may well turn out to be good news.
Since the EPiServer founder sold out to investors with global ambitions back in August 2007, EPiServer has been on a rapid growth path internationally and has successfully managed the transition from founder-led to investor-led. Unlike Danish arch rival Sitecore which went big internationally much earlier, EPiServer actually did not hire their first international employee until 2006 (in Denmark) and did not set foot in the US until early 2009. Today, EPiServer has partners around the world and staff in several European locations as well as a US team with local solution architects, sales, marketing and support. Experienced integration partners may still be few and far between in certain regions, but EPiServer has certainly come a long way since the founder left the company.
Unlike most direct competitors EPiServer has effectively been using venture funding to grow the company and it is highly unlikely that the newest owner, experienced European private equity IK Investment Partners, would have bought the company without being impressed by the management team and without having a detailed plan for continued growth. Replacing family ownership and multiple venture capitalists, this new single owner, positions EPiServer well in terms of preparing for 2011 and beyond in relation to their competitors Alterian, Ektron, Kentico, Sitecore and Telerik. To customers this should mean increased investments in local sales & marketing as well as engineering.
As this unfolding story illustrates, it is difficult to conclude what actually lies ahead for EPiServer. As a prospect or customer, our advice remains:
select implementation partner carefully
negotiate license and support cost, since modules and bundles can quickly get confusing and expensive
talk to the vendor
Next steps
For an in-depth evaluation of EPiServer, I recommend the CMS Vendor Evaluations from Real Story Group.
To learn more about EPiServer or assistance with selecting the right CMS, please contact us for professional services. If you are interested in meeting with other EPiServer customers, consider joining our community or attending one of our industry events.
“As someone who’s gone through an acquisition when Autonomy bought Interwoven, I’ve learned that actions speak louder than words (and press releases) when it comes to trying to understand the future direction of the acquired company. It’s way too early to have any insight into the future of EPIServer, we won’t know much until a year from now. There is one interesting data point on the IK Investments website at http://www.ikinvest.com/templates/Page.aspx?id=2008:
“An important element of IK’s strategy is to acquire companies that are well-positioned in their local markets and to transform them into regional or pan-European market leaders through geographic expansion as well as strategic and operational improvement. IK believes that the successful execution of this strategy requires both an intimate knowledge of local markets as well as a pan-regional reach. ”
It would seem IK doesn’t have a track record in expansion outside of Europe, but then again actions will speak louder than words. To me, the acquisition is another sign that this space is on fire, as we’re seeing high double digit revenue growth from vendors across the board.
-Tom (disclosure, I work at Ektron)”
“I would echo Tom’s words having been through the Mediasurface acquisition of Immediacy – which is probably why there has been this growing FUD around the EPiServer announcements.
In general, the CMS community has been ‘socialising’ a lot more in recent years – both online and offline – so the experiences of those who have been at the mercy of the ‘money men’ in these acquisition scenarios and the after-effects of post acquisition directions and decisions have been revealed and discussed far more openly than before.
As an EPiServer customer, I’ve experienced changes in the company over the last year as they’ve been preparing the company for sale that I think have impacted negatively on the ease of doing business with them. I think it has been described well in John Goode’s recent post about the ‘profit imperative’ http://johngoode.com/company-for-sale where milking what you can out of the license model takes precedence over improving user experience.
My real hope for the EPiServer team now is that they don’t start having the types of ‘product management’ meetings with their new owners that happened after the Mediasurface acquisition of Immediacy where all the focus was on maximising license revenue from the existing product and customer base and the long standing pain-points and usability issues in the product set continued to be ignored.
Right now, we have the complete contrast to this approach illustrated by the development and release of Drupal 7 – where the absolute focus of the development community has been on getting the product right which has resulted in delay after delay in it being released. The ‘profit imperative’ means that commercial developers simply can’t operate like that but sadly it also means that these products tend to degrade over time rather than continue to improve at their core.”