Access Group is launching its cloud platform, aCloud, and the first multi tenant applications to run on it today. Its strategy is to add SaaS applications to its on premise portfolio rather than pursue a switchover to the technology and business model.
It is focussing on integration with its on premise applications (rather than competing alternatives) and the first wave of SaaS applications target specific processes such as document, and invoice capture and processing, expense management and a supplier portal. Further applications for the platform will be delivered via in-house development and acquisitions. CEO Chris Bayne says there is little call from the c5000-strong midmarket customer base for SaaS provision of core business and financial management functions like ledgers but there is growing demand for hosting for these types of functions and SaaS for the more commodity or peripheral types of functions. There is an appetite for different consumption models (and potentially hosting as an intermediate move to SaaS) so that it what the company is tapping into.
While aCloud is not particularly innovative from an industry perspective (Microsoft offers on demand additions to on premise ERP; NetSuite and SAP provide integrated on demand ERP suites with access to on premise functions; at the moment only Access can write applications for the cloud platform currently) it is a breakthrough for the company. Vendors need cloud capability to be credible and there are some nice touches. As well as integration, aCloud offers a collaboration and notification engine that makes these features native parts of the SaaS applications, aCloud-aware service packs will enable existing on premise applications to connect to aCloud, and the company will offer a pre-configured scanner/SaaS combo to address document and invoice capture and processing – neatly tying a manual process into a digital and SaaS environment. It is hard to see aCloud competing with the many alternatives on the market for some time yet but it will offer existing on premise-centric customers a cloud option.
As for Access it is keeping its software and revenues firmly on premise for the foreseeable future and is targeting to generate just 10% of its revenue from SaaS in three years – in the form of incremental revenue. The company closed last year with revenue of £33m, which represented c14% organic growth. It has a £40m target for the current year and four months in says the trajectory is good. It is also targeting 20% EBITDA – even with the cloud move. Access has progressed well since its MBO and investment by Lyceum (see Lyceum gets access to Access) and is keen not to unsettle the financial boat. It will also be keen to avoid the losses associated with the SaaS model. But it needs to take care that it does not make the same mistake as Sage by moving too slowly (see here).