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Don't get me wrong, it's nice to see Xero has yet another payroll partner, Sage continues to enhance its existing product line and Wave is doing more in the mobile arena. However, it seemed it was the partner-related activities that warrant the most analysis, so here's my take:
News: Microsoft Dynamics general manager, partner sales Rich Wickham confirmed this week that Microsoft is definitely interested in establishing a business process outsourcing(BPO) program for accounting and CPA firms, to help expand the use of cloud versions of Dynamics NAV and GP.
My Take: I could be really pithy and say that Microsoft decided it didn't want NetSuite and Intacct to have all the fun, but that would also be an oversimplification. It would, however, not be very far from the truth, as the afforementioned cloud accounting and ERP vendors are actively pursuing CPA firms to utilize their products for BPO work. Wickham also recognized that there are more opportunites for their cloudified NAV and GP products to help serve small to midsized business clients that CPA firms have. He also admitted that AX had been getting a lot of attention lately and didn't want the investments made in GP and NAV to go unnoticed, but more than that it appears Microsoft wants its comparatively lower end products to have a greater potential market.
BPO work and cloud accounting products seem to be at least piquing the interest of accounting firms of varying sizes. Many of them have been doing it for quite some time, but admittedly with on premesis systems like Peachtree(sorry, Sage 50), QuickBooks and even GP. There's not a whole lot of ease of collaboration when that happens, as the parties involved are not often on the same version or have to deal with files rather than working in the same program at the same time, as with the cloud products. But I digress.
The point is, while Microsoft does not officially have a BPO program behind NAV or GP, or any of its other products, they are not ones to do anything in a small way. As such, I'm thinking they're waiting to have several solid case studies of accounting firms who have had success utilizing cloudified GP and NAV before shouting from the rooftops that they do indeed have a BPO program behind these products and accountants and CPAs everywhere need to come clamboring. We shall see, but very interesting to say the least.
News: Sage's top Canadian reseller BAASS Business Solutions officially entered the U.S. market with the purchase of Chicago-based Sage partner Axis Global Partners.
My Take: So for one, this is the largest Sage partner merger this year and will create an approximately $18 million, which will likely rank BAASS among the Top 20 accounding and ERP VARs in the country. Aside from size, BAASS gets a U.S. presense, which it never really had before, and a leg up in the Caribbean and Latin American market thanks to Axis which has been doing a fair amount of business in those areas from its Miami office. BAASS and Axis go back to the Accpac days, so both firms know each other well and will likely compliment with services. Axis also brings BAASS some serious Sage CRM clients and expertise, as well as a NetSuite practice since Axis signed on as a partner last year. In addition, founding Axis partner Manny Buigas becomes head of BAASS's U.S. operation. Overall, not a bad deal all around and I certainly expect more from the Sage and Microsoft families, for sure.
News: Top Sage partner Net@Work establishes a nonprofit practice through the purchase of Huckstep & Associates, one of Sage's most succcessful nonprofit product partners.
My Take: Some people really didn't see this one coming, including myself but on the surface it is the classic case of a smaller VAR --albeit a specialize one--with limited growth options. Huckstep has deep roots in the nonprofit community that go back nearly 20 years, implementing and advising on HR and accounting systems for nonprofit and governement organizations. Net@Work, while it has nonprofit clients, cannot make that claim and nor can many resellers. Co-president Alex Solomon himself even said that while his firm has been "dabbling" in nonprofit accounting system work, "you don't just dabble in nonprofit" simply because it takes specific knowledge of the launguage and expertice of this business sector. The irony of the deal is that Net@Work has not (yet) represented a non-Sage product, other than its own. But, because Sage sold off its Nonprofit Solutions line to Accel-KKR back in February. The products have yet to be renamed, but are not expected to keep the Sage brand for sure. Huckstep, while small (about half a dozen staff or so) does bring on about 350 nonprofit and public sector agencies. Also, founder Jeannie Huckstep now becomes Net@Work's nonprofit practice director so the net-net is everyone keeps their job and gets more resources to do it better. Again, a very good deal all around.
Next week is a pretty busy week for me. On Sunday I'll be headed down to the Information Technology Alliance's Spring Collaborative meeting so expect some reporting from there. Then Wednesday and Thursday the NY Accounting Technology Show is in town. Not expecting a whole lot of news from there, though I know a couple of organizations that will have some significant announcements so stay tuned.