Monday, January 12, 2009

2009 starts well for Sinequa

The financial crisis became an economic crisis affecting all industries and companies. In this context, I am satisfied by the good results of Sinequa and conforted that we took the right management and business decisions.

Sinequa has been recognized for the second year in a row as one of the top three French software vendors with the highest annual growth rate (we were first in 2007 and are third in 2008 of the AFDEL EuroSoftware 100 ranking). After a reorganization of the company (recrutment of a VP of alliances, reorganization of a slightly oversized management team, externalization of some of the research team whose work seemed to far away from our core business and customer needs) and thanks to our tight budget control, we should be EBITDA positive for the fifth consecutive year. And we continue to experience strong growth. Very encouraging, our indirect sales are starting to represent more and more volume and the public sector (unaffected by the crisis) represents a stable 25% of revenue. For example, one administration generated 500 K€ of revenue last year and was brought by a partner, just as a recent new signature (an English financial institution).

Controlled by its management and strongly supported by its financial VC partner X-Ange (backed by the French Post), Sinequa just received additional financial backing by OSEO and a large French Bank. All together, the available cash we can count on represents a year of revenue, this is more than sufficient for a profitable company. Beyond this financial security, we have been offered financial funding to support strategic development initiatives ... we remain very conservative on this possibility though.

On the product side, our new offering easily manages a billion corporate documents. Features tailored to the professional environment and its ease of deployment, provide the high end industrial solution for enterprises, beyond a simple search engine, a solution for collective intelligence (I will comment on it in another post). Some of our customers also deploy the research modules in video, sound and images. I am very pleased that our vision (connectivity, security, scalability, relevancy and the enterprise 2.0) meets the needs of customers. This is our main goal, which drives us and our evolution, and I am not afraid to say it is our obsession, our 'raison d'etre'. And for new customers just to speak only of France, the deployments at Saint Gobain, Sagem Communication, in SFR or Atos Origin, Le Figaro or at Courrier International or L'Equipe TV ... appear to be highly satisfactory.

I was also pleased to note in the December 2008 article in Wired magazine devoted to Ray Ozzie, the replacement of Bill Gates at Microsoft, that he put in place at Microsoft a way of working that we practice at Sinequa (i.e. small teams, a large open space, white boards everywhere...). 2009 will certainly be an eventful year for the economy, for the software industry and for search engine vendors. One of 10 forecasts for 2009 from the analyst firm IDC is a "re-invention of access to information and analysis will accelerate in 2009 driven by the fiasco of the financial industry, the increase of data ...". IDC believes that major players like EMC, Google, HP, IBM, ... will buy companies like ... Sinequa (IDC cites several others, including our fellow French Exalead who matched our revenue figures with strong growth last year while continuing to post losses of around € 5 million annually). I think not, I think this year is not conducive to mergers and acquisitions of quality. I believe that those who are well positioned and managed with modesty like Sinequa will continue their development, while unprofitable start-ups generating a lot of noise but little financial results, will face a tough period during the economic crisis and it will be difficult for them to negotiate their rescue by leading industrialists who are too busy with their own passage through the economic crisis.

Link to download the IDC article:

Link to article in French:

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