SSII indépendantes en Europe: sont elles vouées à rester des "lifestyle companies"? ou devenir des acteurs de niches?

Après avoir prévu le besoin de la consolidation de SSII généralistes en 2007, et ayant fait un roll-up de 18 PME technologiques entre la France et le Maroc, avec une focalisation précise sur l'offshoring et la delocalisation, je me demande s'il y a toujours un espace de développement de SSII indépendantes en Europe.

Toutes les SSII indépendantes que j'ai vues étaient marginalement bénéficiaires (1-5%) ou étaient dans une fuite en avant sur leur cash flow. Certes être entre 10 et 100 millions d'euros n'est pas une mince affaire mais les majors continuent de descendre de plus en plus vers le bas de la chaîne de valeur.

De plus, des arrivants comme Salesforce.com avec leur business modèle ouvert est clairement un attrait majeur pour les PME généralement clientes de ces SSII indépendantes.

Un vrai problème se pose donc pour leur pérennité ou même leur ouverture du capital: qui intéresseraient-elles? Ni les fonds, ni les stratégiques. Peut être sont elles vouées à rester des "lifestyle companies", c'est à dire la pour subventionner le style de vie de leurs fondateurs, sans pour autant avoir un avenir de croissance.

Concentration du secteur Logiciels & Services : comment le marché se consolide ?

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When a Healthy Smaller Company acquires a Troubled Larger Company

When a Healthy Smaller Company acquires a Troubled Larger Company, it is described in my business as "landing a mechanically-troubled F-18 fighter jet on stamp-sized ocean-carrier in darkness".

Here is the board of the smaller company, unchallenged, rubber-stamping profits year-after-year, stable management team, nice customers, committed suppliers, who decides that the opportunity of acquiring the troubled regional leader is a once-in-a-lifetime opportunity. It sure is! it is also, in my view, the once-in-a-lifetime opportunity to throw the baby with the bathwater, if not done properly.

"I thank you all for having a strike today"

The everyday work and drama of restructuring a business, whether it is as a result of a merger, a rollup, an integration or simply to rescue a business, can be pretty amazing, in good and bad.

You do find yourself frequently communicating to various stakeholders trying to inspire them to take action in the right direction. Erik actually spent the time to catalog the best phrases that came out from his gut. Funny as hell!

In my recent 18-company rollup across multiple cultures, I uttered many of these phrases, probably a few that would be censored, as sometimes certain cultures only react, instead of "act".

Smooth handover in Private Equity rollups is the name of the Game

When doing a rollup, it is often said that capital efficiency should come from financial engineering. So when Rachid Sefrioui started his 18 company rollup in IT Services and Offshoring, the name of the game was half-cash, half-earnout.

The notion of an earnout is when you give the seller the other half of his price when the operating and financial goals are met in the subsequent 3 years. Of course what comes with that is that the seller has to stay in operations to achieve those objectives and get the rest of his payment.

And that is where problems arise...

Indeed as a new acquirer you want to take over customer relationships, employee relationships and supplier/partner relationships. But the seller who is still running the company does not want to let go. Understandably. He feels the buyer has not paid up yet. But more realistically because he wants to keep those relationships as exclusive to him as possible so that when the buyer finishes paying, the seller can walk away with "his" customer relationships, "his" trusted employees, and "his" suppliers/partners.

This happens everytime because of the emotional structure of founders. They fundamentally believe that "The company is me".

Having lived through this scenario many times over, it becomes an art to smoothly accomplish the handover of these business-critical relationships to new managers the acquirer puts in place. If the handover is not smooth, or rather becomes a wrigling of those relationships, now winner comes out. The company ecosystem becomes polluted with hear-say, relationships are asked to choose "them vs. me", and eventually clans build up inside the company. This environment immediately affect company performance, and may take another 3 years to rebuild after a brutal separation with the founder and his cronies is consummated.

Smooth handover over time is the name of the game in rollups. Be patient. Take a few punches. Stomach a few bad apples. But in the end, it will make the acquisition price worth it, inside the initial 3 years of the earnout.