By: Mark McGregor, Research Director, Bloor Research (Moved)
Published: 24th November 2011
Copyright Bloor Research © 2011
It was interesting to see that TIBCO's acquisition of Nimbus generated so many negative comments in the analyst and blog community. Some suggested it was a strange acquisition, while others suggested it was a "Fire Sale". Perhaps I stand alone in thinking that it was a clever move by both parties.
Nimbus has acquired something of a reputation among their competitors for closing sales where others did not even know that there was a requirement! In part this is down to the difference of the Nimbus sales model. The management team at Nimbus almost all came from major consulting firms and, as such, have great connections at the CXO level. Over the years Nimbus very cleverly worked that network and focussed on real business engagement with business leaders, resulting in them being able to open doors, make a pitch and then close the door before others knew anything about it.
Many other vendors talk about selling to the business, but invariably still end up talking to the IT side. Nimbus has always talked about and executed a strategy that focussed purely on senior business leaders.
By extension, this means that TIBCO has acquired a team of senior staff who can now start to take TIBCO and the TIBCO offerings in at the very top of organisations, something that others will struggle to do.
Then we come to the issue of a "Fire Sale" with a reputed price paid of in excess of $42m dollars against probable revenues around $15m. Then a 3 times revenue price seems pretty high for a burning platform and instead looks like a pretty good deal for the Nimbus shareholders. I can think of a number of vendors who can only dream of trying to exit at this ratio. Indeed I understand that TIBCO were considering a number of players in the space before settling on Nimbus.
The Nimbus approach is very different from others in the BPA space to which they are often associated. They are not a modelling vendor in the true sense, but do fill a gap which other BPA vendors have done a poor job with over the years - that of operationalizing the maps and models. Nimbus has always focussed on the last piece of the puzzle, making required information readily available to those who need it, in ways that they can use and act on. (As a footnote, Nimbus were the first vendor in the BPA/BPM space to deliver a native app solution for IOS devices).
This focus on the consumer of the information is something that other vendors need to be more active with. It is not simply about making maps and models available but providing help, guidance and intelligent information at the point of need,
The fact that TIBCO will be maintaining Nimbus as a separate group means that existing Nimbus customers can continue to enjoy the relationships they have built up, while knowing that the company has the security of strong financial backing behind them. Beyond that, the team at Nimbus have already started to integrate other TIBCO technology into the Control product. Detailed plans have not yet been announced, but it seems as though with products like Spotfire and tibbr available to them that the analytic and social networking capabilities will be far in excess of what others in the BPA sector can offer.
As with any acquisition it will take time to fully play out, but the impression is that this is a clever move for both parties, with significant upside for customers of both companies. I do, however, wonder whether TIBCO might still consider acquiring another vendor in the BPA space, one who has a much stronger modelling component. Neither Nimbus or TIBCO are especially strong there, but adding the Nimbus offering to a full fledged BPA tool would provide a far more valuable offering to users. Indeed, I would suspect that with an integrated offering there would be significant opportunity to sell Control into the existing modelling user base, replacing what has historically been poor back end publishing capability.
One area that will be interesting to see is how Nimbus make use of the TIBCO process execution engines. This could be used in 3 ways.
Of these the most likely is the second scenario, where Nimbus could add greatest value by adding as the container for process applications e.g. expense handling, vacation requests or change management. This would leave the company to stay focussed on the consumers of technology and the business managers around them - rather than to mix it with the normal BPMS type players.
In conclusion, Nimbus customers should feel comfortable that there is greater financial certainty to support their purchase decision, along with faster access to technology that will enable even greater leverage from their investment to date. Meanwhile, TIBCO customers may wish to take a look at how adding Nimbus Control could help them ensure that the right information is available in an easy use format for their business users.
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