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I’m writing this post on my way back from one of my increasingly frequent trips to a country I now consider to be my second home – Brazil. And as you asked, yes, it’s BA, the first airline – and perhaps the only airline (and if so, let’s hope it remains the only airline) to believe that what business class passengers most want in life is to fly backwards. Anyway, at Sao Paulo airport I picked up a copy of Exame, one of the leading business magazines here. It was a special edition – their annual rankings and reviews of the 1,000 leading companies in Brazil. And they gave their prestigious Company of the Year award to Totvs, albeit only 419th in Exame’s rankings.
Now, the ERP cognoscenti among you will undoubtedly know that besides being Brazil’s largest indigenous software firm, Totvs (pronounced the Latin way i.e. ‘totus’) also claims to be the sixth largest ERP player in the world. This is on the basis of worldwide revenues of R$1.3b (R$ = Reais, of which there are currently about two to the US dollar and just over three to the pound). Even with its SME focus, Totvs owns the Brazilian ERP market, commanding 53% share; SAP comes in around 23%, and Oracle less than 7%. Sage, (mistakenly identified as an American company by Exame), which recently acquired a controlling share in one of the country’s leading accounting software firms, Folhamatic (see here), is among the also-rans in Brazil, with revenues probably around R$200m.
The Totvs story is a very good read and I’ll leave it for another time – perhaps if (and that’s a most unlikely if) Totvs decides its next international target is the UK. Totvs already operates in 23 countries but Brazil is the only one in which it leads the market. I am assuming that Totvs’ entry into almost all its other markets is on the basis of ‘follow the client’. I say that because its attempts to go after the large enterprise market in its own right in both Portugal and Mexico ended up losing them money in those countries. Because of this, Totvs CEO and co-founder, Laercio Cosentino, has reportedly ditched plans to enter India and Australia. However, Totvs opened an office in Silicon Valley last December and has recruited managers from Yahoo and eBay to help with product development, notably in the social media area.
Totvs is ten times the size it was ten years ago – a combination of organic and acquisitive growth. Cosentino now wants to double revenues by 2016, which he believes would position Totvs as the third largest ERP player globally. Nobody can accuse Brazilians of being short on ambition!
Eligible TechMarketView subscription service clients will be able to read my latest observations on the Brazilian IT services market very soon in the next edition of BrazilViews.
