Yesterday, the UK-based Sage Group said it had agreed to sell 7 of their non-core products, virtually divesting themselves of their North American operations. Notable divestitures in the CRM space are:
- ACT! (a contact and customer management solution for small businesses) and SalesLogix ( a CRM solution aimed at the midmarket, that Forrester ranks as a leader in the midmarket CRM WAVE), to Swiftpage
- Sage Nonprofit solutions (a suite of solutions for fund accounting, donor and fundraising management, grant management software) to the Silicon-Valley based, private equity firm, Accel-KKR.
What does this divestiture mean?
- Sage has previously publically identified what products are core and non-core to their business. Divesting of non-core, and perhaps underperforming products allows the company to better focus existing resources in a highly competitive solution space.
- The Swiftpage acquisition is a natural acquisition, as Switpage has been a development partner of Sage’s, and has already built robust integrations between product suites.The acquired Sage products are complementary to Switpage’s email and social media marketing products and will allow Switpage to deliver a comprehensive digital marketing solutions to their prospects. However, Swiftpage will have its work cut out for itself to bring a differentiated value proposition to a very competitive market.
- The Accel-KKR acquisition is also easy to rationalize. Accel-KKR brings operational best practice management to midmarket software compaies in order to turn them around and/or to accelerate their growth. Accel-KKR already has knowledge of the CRM space with their acquisition of Kana Software (a customer service soultion) and Lagan (a government CRM solution).
These sales will allow Sage to better focus on their core products of Sage CRM and Sage ERP which are both aimed at small-to midmarket companies who want integrated back and front office capabilities, and who want a single view of customer and product data across the organization.Sage says that their roadmap investments will include deeper integration within their product suite, and a fleshing out of their cloud and mobile strategies in order to make them more competitive.