Under New CEO, HelpSystems Snaps Up Rival Halcyon
January 12, 2015 Alex Woodie
New HelpSystems CEO Chris Heim didn’t waste any time making his first big move last week when the company announced the acquisition of Halcyon Software, its closest natural competitor in systems management. The acquisition and the hiring of Heim–a one-time programmer with an eye for product development–kicked off a new era for HelpSystems following the retirement of former CEO Janet Dryer, who has been with the company for 30 years.
HelpSystems looks a lot different today than when Dryer took over the top job at Help/Systems (it had a slash in its name until recently) 16 years ago. At that time, the company had a single line of products–the Robot family of systems management tools for what was then called the AS/400 and now is the Power Systems running IBM i. Back then, the company was based in the suburbs of Minneapolis, Minnesota, had about 90 employees, and enjoyed sales of about $20 million. It wasn’t the biggest dog in what was then a significantly larger OS/400 playground, but the company and its products were well-respected and its customers were satisfied. Life was good.
Under Dryer, the Midwestern company with the robotic mascot expanded its frame several times over, and in doing so became an industry leader. With funding from equity capital partners, the company pulled off a string of acquisitions, starting with the 2006 purchase of Advanced Systems Concepts. What followed was a flurry of acquisitions: PowerTech, Bytware, and a European partner in 2008; a product from Innovatum in 2011; CCSS, Safestone, and Intermapper in 2012; Dartware and the ShowCase products from IBM in 2013; and fellow Minneapolis firms RJS Software and Coglin Mill in 2014.
All told, HelpSystems made 13 acquisitions under Dryer’s watch (not counting Halcyon) and revenues grew to more than $110 million. With nearly 300 employees spread out across various offices, the company became arguably the biggest IBM i-focused software company not selling ERP applications, and became a force to be reckoned with in business intelligence and security, too.
In an interview with The Four Hundred, Heim declared his number one priority as maintaining Dryer’s legacy. “First and foremost, we don’t want to screw things up,” he says. “This is a successful company already and we want to retain the core values of taking care of employees and taking care of customers and providing world class service.”
Heim lauded the work Dryer and her team did growing HelpSystems’ revenue five-fold without hurting its reputation. “They’ve done a wonderful job acquiring companies and growing the organization and creating a great culture here that keeps people around,” he says. “She’s done a masterful job.”
Asked what his imprint on the company will be, Heim pointed to his background as a programmer and his experience developing products. “We hope to be able to accelerate some things like making our products work better together,” he says. “We want to push the envelope a little bit on the product side, and given my background versus Janet’s, hopefully we can do that and create products that better meet our customers’ needs in the future.”
Respect for the IBM i
Heim cut his teeth on enterprise software at Data Collection Systems (now Highjump Software), a developer of PC-based supply chain execution software headquartered in the Minneapolis area. “I touched every operating discipline of the company and was around for a really nice growth trajectory as we took it from $8 million to $80 million,” he says. “We had great customer satisfaction, which is something I’m a deep believer in, and we did some innovative things with products.”
It was at Highjump that Heim got his first taste of the AS/400 and learned how to program in RPG. “We did supply chain execution, logistics software, but most of our customers were manufacturing companies running the IBM i, for all kinds of different manufacturing packages,” he says. “We developed a lot of expertise both in interfacing to the IBM i and helping the customers with incorporating our data into theirs, etc.”
Heim was the CEO at Highjump for the last 10 years of his 20-year stay, and left to join communications software provider Amcom Software, another Twin Cities company that grew to about $55 million before being acquired last year by a company called Spok. At Amcom, Heim again ran into the IBM i platform, which was used by a good number of Amcom’s customers in the hospitality, gaming, and government markets.
Heim recognizes the importance of the IBM i platform to HelpSystems’ business, as well as to the businesses of its customers. “I have great appreciation for the platform given that most of our customs were on it at Highjump,” he says. “I’ve always been impressed with the security around the platform, the rock-solid reliability, the availability of great applications. I think there’s a fundamental appreciation for how good that platform is.”
Naturally, the company’s product development and acquisition roadmaps will feature IBM i in a prominent manner. But that’s not to say HelpSystems won’t move forward on other platforms.
“We’re very committed to the IBM i space,” says Heim. “What we’re also doing is listening to our customers in the IBM i space. Theirs is a multi-platform world now. We’re definitely not confining our search to IBM i. We want to be there for our customers as they embrace other platforms as well, as part of our overall strategy. Our commitment is unwavering for the IBM i but we understand that a lot of our customers today have a heterogeneous environment, and we want to meet their needs across all environments.”
Most recently, Heim was CEO of Axium Software, a Portland, Oregon-based company that provides accounting software for architects and engineers. The weekly commute for the self-described Minnesota farm boy was rough, and Heim was eager to go back to the city he has called home since 1986.
Heim brings with him his longtime CFO from Axium and Amcom, Dan Mayleben, who is the new CFO at HelpSystems, replacing Mark Ties, who became the COO. Jim Cassens remains president of the cross-platform solutions for the company, while Dryer retains the chairmanship.
“It’s a nice combination of an outside perspective with Dan and myself combined with Jim Cassens, who’s been here a long time, and Mark Ties,” Heim says. “We kind of have a nice balance between knowledge of the company so we don’t screw it up, along with some outside perspective. We think that’s a good combination.”
While Dryer has handed day-to-day control over to Heim, she will remain just a phone call away. “I have not hesitated to reach out,” he says. “I hear from Janet every day.”
Dryer says she’s grateful for the years she spent at HelpSystems. “I look forward to watching the company continue to deliver high-quality IT management software, provide exceptional customer service, and generously give back to our community. I am so proud of what we’ve built and know I am leaving HelpSystems in good hands,” she says in a statement.
The addition of Halcyon Software to HelpSystems strengthens the stable of systems management tools it offers, both on the IBM i operating system as well as on other platforms. Terms of the deal were not disclosed.
Halcyon battled HelpSystems for years, and developed a strong business catering to the IBM i management needs of managed service providers (MSPs), which HelpSystems will look to continue.
For Halcyon CEO Lorraine Cousins, the time was right for the deal. “Our leadership team recognizes that the Halcyon portfolio can continue to be strengthened to meet the needs of our enterprise customers, partners, and growing managed service provider network with the resources and support of an organization like HelpSystems,” she says in a statement.
Halcyon competed directly with HelpSystems for job scheduling and backup software, and had several automation suites devoted to monitoring and managing the execution and performance of applications a variety of servers, including IBM i, Windows, Linux, and AIX. Recently Halcyon had recently expanded into the security and document management space, two areas where HelpSystems has already made significant investments. It will be interesting to see how the expansive Halcyon product lineup continues under the HelpSystems banner, and what moves HelpSystems will make next under its new product-oriented CEO.