Third-Party ERP Maintenance Firms Report Record-Setting Revenues
August 14, 2012 Alex Woodie
Spinnaker Support, which provides third-party maintenance of Oracle JD Edwards and SAP ERP systems, says that its revenues for the first half of 2012 were 44 percent higher than they were for the first half of 2011. Its sales bookings were 48 percent higher at the halfway mark of 2012 than they were last year. And the number of customer transactions it has finalized is up 55 percent from last year. The closely held company only provided percentages, not actual figures.
Much of the up tick in Spinnaker’s numbers can be attributed to its acquisition of Versytec this March. Versytec was one of the first firms to provide third-party maintenance to JD Edwards shops when it entered the market in 2004, and had several dozens of JD Edwards customers, including a good number of World (RPG-based) shops.
Following the Versytec acquisition, the Denver, Colorado, company claimed to have more than 160 JD Edwards customers around the world. In May, it launched its SAP maintenance business, with three customers already on board.
Meanwhile, Rimini Street also had a great second quarter. The Las Vegas, Nevada, company, which provides support for its clients’ JD Edwards, SAP, PeopleSoft, Oracle E Business Suite, and Oracle database implementations, says it second quarter revenue totaled $10.5 million, a 30 percent increase over last year’s second quarter, and a new record for the company.
Rimini says it set record highs in several financial categories, including quarterly revenue, new client invoicing, sales bookings and sales bookings backlog. The company says it completed transactions totaling nearly $53 million in sales bookings, and increased new client invoicing during the quarter by 46 percent, to $5.4 million. Its sales bookings backlog (or the projected amount of sales it has under contract) is more than $470 million.
Neither Spinnaker nor Rimini are public companies, so the information they provide is limited, and of limited value. However, Rimini–which is considerably larger than Spinnaker and claims 500 customers, including 58 Fortune 500 companies and 14 Global 100 companies–has been very open about its intentions to file an initial public offering (IPO) of stock. Spinnaker, perhaps, is positioning itself to make a similar move, in case a Rimini IPO is wildly successful. Besides, customers need to have choices, even in the third-party maintenance market.