Docville 2016 – June 6th 2016 – Brussels, Belgium

Yesterday I had the pleasure of attending Michael Ziegler’s Docville 2016 event here in Brussels. I attended this same event 2 years ago and was pleasantly surprised at the size and quality of the attendance. Not your “normal” trade/vendor event, Michael focuses heavily on networking, collaboration in roundtable sessions on tough topics and issues and attracts over 100 of Europe’s best and brightest ECM ISV’s and channel partners.

The event was themed around the challenges and opportunities of digital transformation and how the ECM community should respond and engage to the changes in market dynamics brought about by Cloud, SaaS and Mobile innovations.

I was fortunate the share the keynote session with Michael (request a copy of presentation here) and then attended a number of the roundtable sessions – as the day drew to a close the session leaders reported back to all the attendees their findings and conclusions…..and that is where I got to thinking about how you can create an early morning caffeine-like kick start to an industry that has been around since the mid 80’s and despite surviving and thriving during prior technology transitions just looks a bit tired and hung over… so here is my Double Espresso for the European ECM Community…

Digital Transformation has been underway for years already, companies like Box and Dropbox have already ridden the wave of Cloud based File Sync & Share for digital content, Kodak disappeared under the waves to be replaced by the new Goddess of photographic images – Instagram! The journey has been underway for some time but frankly some of the attendees at this event seemed like they hadn’t even been given a map yet and some looked pretty lost in my opinion.

The narrative used by the ECM community to explain why it is relevant in this digital transformation landscape is still pretty weak and needs a major upgrade – even the term “Enterprise Content Management” which was dropped by most customers a few years ago remains central to the discussion when frankly it should be consigned to a discussion of heritage and history not vision and innovation. Slack, one of the new leaders in the world of digital transformation and content collaboration has spent more in two years on marketing their solutions that are content and task centric than probably IBM/FileNet and EMC/Documentum put together!

The pace of change in our digitally content challenged sector is simply too slow – in Silicon Valley the pace is relentless, fueled by VC investments and private equity funding, the lights burn bright into the night and Stanford grads create new ideas, build a product, deploy it on the AppStore and then trash it and move onto the next opportunity in a matter of weeks. I am not saying this is the best way to innovate but certainly seems like Europe is lagging in terms of vision and the investment needed to move the ECM solutions market to the next level.

Take a simple challenge like defining the use cases for capturing images on a mobile device and moving them into the document recognition and classification steps of a workflow process – aka Mobile Capture. I sat through 2 round tables where frankly the thinking hadn’t moved on much from 3 years ago where an auto accident claims demo using mobile capture was show cased at Kofax’s user event in Las Vegas – surely with all the challenges in digital transformation and capturing information effectively at or near the point of its origination there must be 100’s of potential uses case to be solved – what about just looking at healthcare, at home health diagnosis, medication prescriptions etc?

For me the missing element here falls into two related camps. Firstly, ECM vendors interested in driving digital transformation need to engage more proactively with new potential customers and not just keep rolling back into existing clients who have invested millions $ in massive ECM infrastructures – let the support guys look after the big implementation but sales and marketing guys need to be looking for new use cases, new solutions opportunities, talking to prospective customer who don’t care about “ECM” but do care about managing digital content inside and outside their businesses using mobile devices and slick, smart processes. Speaking to the same people will get you the same answer – go speak to some new people and you’ll get a different and potentially better answer that will help fuel your growth.

Secondly, I would focus every single ounce/gram of effort on exploring the Customer Experience Management space for solutions and opportunities that need a strong digital content capability. Organizations will always find it hard to control the flow of information coming into their business from their customers, even with mobile apps pre-packaged to accept certain types of data and information customers are still going to take a photo of a document, a car accident, their prescription, their dog(!) and send it in as proof of something or other. Forrester have done some great research in this space over the years and continue to do so – I would start but gaining as much knowledge and expertise about CxM type problems and opportunities and then go sell solutions that solve those problems.

Basically it’s time to wake up, get a big, strong pot of coffee and start to think hard about where the growth and opportunity is for this great ECM community and market…. It’s either that or go back to bed and pull the covers over your head and make out nothing changed!

MC

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If you are the owner of a small software business, I’m sure that you have paid particular attention as the news hits of another peer company selling at a very high valuation in relation to their revenue and profit. And after you roll your eyes or shake your head with envy, you quickly do the math on the potential sale price for your business at the same multipliers. Following that is the brief daydream about what that sale would mean for you, your family and other stake-holders. And of course, that luxury purchase you have always denied yourself that would also be enabled by the sale.

You probably wouldn’t be human, if you didn’t take part in this ritual. But alas, the daydream is brief and you are quickly brought back to reality. And reality might include asking the question, once again, of what your company is currently worth and what would warrant a higher valuation. The easy answer, as always, is sustainable revenue growth and related profit. And of course those are worthy goals for all enterprises, but there are other factors that could be worth exploring.

Some thoughtful brainstorming about what would earn (yes, I said earn) your company a higher valuation multiplier would be the most constructive and possibly lucrative thing to do. So, let’s consider four steps, or questions, that we could ask and explore the answers that might lead to a breakthrough value creation strategy for your business:

1. What are the companies that would likely benefit most by owning your business and what are their strategic initiatives? If you find some commonality here, the plan might include moving your company in a direction where it could add more value to the achievement of the business goals of your possible suitors.

2. What is driving growth in your industry and how is your business positioned to leverage those drivers? So, for example, Cloud and SaaS are big growth drivers in many segments of the software industry. And smaller software companies whose expertise and offerings would enable larger companies to move more quickly into Cloud and SaaS, would surely garner higher valuations in today’s market.

3. What would possible suitors not like about your business? To truthfully answer this question might require a qualified third party analysis. But such an effort might reveal some relatively easy fixes that could make your business more compelling and valuable to possible acquisition partners in a short period of time.

4. What would a potential buyers perception be of the health and growth of your business if they simply visited your web site? Many companies who have an acquisition strategy start their evaluation process with simple steps like reviewing your web site and how you talk about solutions and customers, looking at your social media presence and how others talk about you, and assessing your financial viability via tools like Crunchbase. An agreed set of messaging that is consistently executed across all these platforms means a potential buyer gets the message you would want them to hear – loud and clear.

So, the next time a peer company sells at a high valuation, let’s raise a glass in congratulations to the owners of that business. Then think about the questions they may have asked themselves on the valuation front a year or two ago and the actions they likely took to earn a higher valuation. Finally, and most importantly, let’s then role up our sleeves and get to work on our valuation. And of course, it is okay to also spend a minute dreaming about that luxury purchase we will make when we are the ones making the news of another high valuation sale.