No one has either the skills or the experience to do it all single handed, commented Eric Mouilleron, European managing director of Valtech SA the Paris, France based consulting group that says it’s busy partnering with bigger players and buying smaller specialist software shops.
Last month Valtech acquired the 40-strong Dallas, US based software project management house of Expede and now, following its flotation this month on the Paris Bourse Noveau Marche that raised an estimated FFr 40.03m ($6.48m), Mouilleron has drawn up a shopping list for European acquisitions. There are currently eight companies in northern Europe that I will be looking at in the next two weeks, he told us, we’re looking for consulting and managerial talent primarily.
The company has also just moved itself close to Informix Corp and its recently formed i.Informix division to provide the database supplier with systems integration and web hosting know-how for web site deployment. As well as an expected $500,000 in revenue, the deal will bring us a larger share of and greater visibility in the e-commerce market, said Mouilleron. The i.Sell&Trade package is designed to manage high-volume e-commerce transactions over the web. Valtech’s value-add is its reputation, having designed and delivered over 200 large-scale e-commerce
implementations.
Founded in 1993, Valtech initially focused on object modeling. In 1994 the company made a strategic commitment to CORBA (common object request broker architecture) and in 1995 took on Java, and has since been designated an Object Reality Center under Sun’s Authorized Java Center program.
The technology that Valtech deals in tends to be unproven and the company has to
overcome some considerable wariness among prospective clients. Whether it
wins a bid or not, Mouilleron views any new business in the market as a positive sign. The more projects that go ahead, the more our potential market increases as the reputation of the technology grows, he explained. Judging by Valtech’s client list the company is managing to hold its own. British Telecom, Barclays, Merrill Lynch, JP Morgan, Peugeot-Citroen and Air France rank among Valtech customers. And the company reports that in 1998 around 80% of its revenue derived from repeat business.
Revenue for 1998 was reported as FFr 98.3m ($16m) with a target of FFr 163m ($26.6m) set for 1999. Its reported five-year average growth stood at 114% by year-end 1998. Operating margin for year-end 1998 stood at 7% but Mouilleron warns that this may fall to around 5% for 1999 following-on from the cost of integrating acquired companies.
With 120 consultants globally 90 of whom are based in Europe, the company is growing in terms of professional services staff at a rate of 60% per year. Turnover is low at 6%. We retain staff by taking on challenging projects. We also have an employee stock option scheme that means employees have a real stake in the future of the company, Mouilleron reported.
Its service offerings are divided into the three main groupings of enterprise-planning services, software project delivery services and skills transfer services. Its enterprise planning strategies unit includes migration planning for legacy systems, software reuse planning that aims to progressively cut development time, and legacy system integration that assesses the viability of legacy system reuse. Project delivery services are broken into two phases of planning and development. In the planning
phase Valtech offers services that include function requirement definition, technical architecture specification, project scheduling and budgeting. For its development phase Valtech offers services including project management, management consulting, analysis and design and design/code reviews.
Valtech’s skills transfer services offers training in Java, intranet, security, CORBA, UML and C++. These services are delivered on-site if required. Training contributed around 40% of Valtech’s business in 1998 training over 8,000 people in advanced systems engineering.
