The largest Ukrainian information-system designer Softline and international investment company SigmaBleyzer have recently become partners. The companies cooperate on an equal footing, namely SigmaBleyzer has invested over a million US dollars in Softline
INVESTOR TURNS INTO A PARTNER
The largest Ukrainian information-system designer Softline and international investment company SigmaBleyzer have recently become partners. The companies cooperate on an equal footing, namely SigmaBleyzer has invested over a million US dollars in Softline acquiring a half of the total shares in this software company.
Softline has already been on the domestic information technologies market for 5 years. The key directions of the company’s business are reengineering and development of highly sophisticated information systems for large and medium-size enterprises and organizations; management consulting and information consulting; development and installation of production management systems that automate organization of in-house resource flows and technological stages, make use of financial instruments, managerial accounting, etc.; development of software complexes; and information systems’ project integration. The company thinks Megapolis system to be its main achievement. This system is a complex of instruments for design, development, application, and maintenance of sophisticated information systems in the trimeric client-server architecture.
Softline has been working exclusively with domestic clients until recently.
Now, the management of the company thinks that it has all the required prerequisites for further growth. Thus, it initiated cooperation with the investment fund.
It is understandable that this step will drastically change the company’s structure and the scope of business. First of all, such changes will have to do with the company’s launching foreign markets and will lead to qualitative development of the current technologies and products in accordance with foreign customers’ requirements (for example, development of the second version of Megapolis system is already on the agenda), as well as to generation of promotion strategy for company’s products on foreign markets, and to introduction of new foreign hi-tech achievements into the company’s technological process.
The part of SigmaBleyzer investment fund is to facilitate Ukrainian company’s smooth and organic entering into the structure of foreign market for information technologies.
In turn, the project is also a step up for the investor in development of its business. Over the four past years, SigmaBleyzer has been managing assets of the fund family of the Ukrainian Development Fund (UDF) and working with investors, who have at least USD 100 million in their authorized capitals. SigmaBleyzer has brought such worldwide-known companies as Merrill Lynch, SBC Warbung, Goldman Sachs, and ING Barings to the Ukrainian market. SigmaBleyzer and the UDF have invested in Ukrainian companies over USD 70 mln. during this period. The investor now becomes a business partner.
Chairman of the board of SigmaBleyzer Michael Bleyzer noted that Softline was selected, first of all, owing to its high intellectual potential and fundamentally new production organization compared to similar foreign and domestic companies.
Michael Bleyzer believes that the key point here is that most foreign companies established 10 to 15 years ago cannot develop quickly enough today and fail to fully respond to market demands owing to their unhandiness, rather high costs of internal adjustments, and technological conservatism.
On their part, Softline managers have figured out that foreign designers of corporate management systems are unable to adapt to the Ukrainian market conditions. On the one hand, foreign products are significantly mor expensive than those of domestic origin, on the other, they do not completely satisfy the requirements put forward by Ukrainian manufacturers. Thus, the business partners agree that new IT companies always have an advantage over the old-timers on the market. New companies do not have any uncontrolled inertial inclinations and, thus, can meet demands of new clients with more success.
In addition, one of the key criteria in SigmaBleyzer’s selection of a business partner was the level of development. Michael Bleyzer noted that all the companies of this profile usually undergo roughly three stages of development. During the first stage, they sell individual products. On the second stage, they develop and sell software packages based on rather approximate forecasts for their application. Finally, during the third stage, these producers sell software along with a team of workers, who are further responsible for installation and introduction.
Now this approach has been completely changed and the direction of progress has been altered. Before anything is sold, any proficient company engaged in development of production management systems starts working with the client. Firstly, the client’s needs and requirements are clarified, schemes of prospective modelling of his business are developed, and an array of possible solutions to the client’s most urgent problems is worked out.
After the business has been simulated and all the data have been calculated, a draft software solution is worked out and discussed with the client. It is only after the company has worked out a specific project, when it starts to work with the client on execution of the project. However, in order to efficiently bring to life this business approach, the company has to have enough basic developments and a wide instrumental range. According to SigmaBleyzer’s estimates, Softline has the required intellectual technological potential for operation on this level.
As the cooperation continues, SigmaBleyzer plans to gradually establish a network of Softline product promoters; negotiate
with potential customers; render permanent technical support to sales; and finally, conduct marketing research depending on
company’s products’ success on foreign markets. In spite of the far-reaching plans, the business partners assure the
company's Ukrainian clients that their interests are not going to be neglected. On the contrary, Softline's entering the world
market, as well as its integration into international production of information technologies, will award domestic consumers
with foreign achievements in this sphere.