The rise of on-demand CRM has been on our magazine’s radar for quite awhile now. Tier1 Research, a division of The 451 Group, recently found the on-demand CRM market will catapult through 2010 with a compound annual growth rate (CAGR) of 41 percent compared to a predicted 6.2 percent CAGR for on-premises CRM.
Then there’s Austin, Texas–based nGenera, an on-demand vendor that hadn’t been on our radar before exploding onto the scene with its May acquisition of customer interaction solutions provider Talisma. Zachary McGeary, associate analyst at JupiterResearch, says that the Talisma acquisition is important, but only one chapter to the story. “This doesn’t paint the whole picture of what this company is trying to do [and] the strategy it envisions,” he says. “NGenera is continuing to grow to become a more complete on-demand, end-to-end offering for organizations.”
It’s evident that nGenera executives have a clear company vision—a 10-point manifesto on its Web site makes the case for a complete on-demand enterprise suite. A quick glance at the company’s own timeline shows a fast yet steady stream of acquisitions—and $70 million venture capital raised—since its inception as BSG Alliance (the company changed its name to nGenera Corp. in April) in January 2007.
McGeary says that nGenera’s method of building up its on-demand suite of applications mainly through acquisitions differs from the typical path, which generally involves more of an emphasis on product development. He stresses that this is neither an advantage nor a disadvantage, but nGenera is going about its acquisitions in the right way. “The company is always thinking ahead and seems to be moving at the right pace,” he adds. “When you integrate products into a complete offering there is a time frame in which that needs to be completed. If nGenera was to acquire all these solutions [simultaneously], it would have no resources to bring them into the fold all at once.”
When nGenera does pull it all together, traditional on-premises vendors might have to sit up and take notice. “The applications—and technology ecosystem—[that] companies have to maintain their businesses often consist of solutions from myriad vendors for which integration can be rather difficult, tedious, and expensive,” McGeary says. “Some of the application software may be hosted, but it is still on premises and rather messy. What nGenera foresees as the future is providing a complete on-demand [pre-integrated] suite of applications, and it is building around this vision.... I don’t think it’s unrealistic by any means.”
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