It took 80-20 Software almost a year to raise funds for its global take-off. But when it finally did, part of the money came from an unlikely investor.
Teaming up with Allen & Buckeridge, a successful young gun of the Australian venture capitalist arena, was none other than US microprocessor giant Intel. Together they invested in what they believe will be one of the most successful comings of age in the global IT market -- the two-year-old 80-20 Software.
"The deal substantiates two of A&B's founding principles. Firstly, that Australia is a competitive source of world class software development and secondly, the need to be integrated into the global market through the US market with the help of value-adding VCs and strategic partners," Roger Allen, director at Allen & Buckeridge, said.
After setting up headquarters in the Silicon Valley, the Melbourne-based developer of Document Management Extensions (DSE) for Microsoft Exchange will use the funding to leverage its assault on one of the fastest-growing money-making segments in the industry -- enterprise document management.
Largely untapped, the market is predicted to grow from $350-400 million to $2.1 billion within the next couple of years. Frank Stranges, chairman and CEO of 80-20 Software, believes that thanks to the fund injection his company could own around 25 per cent of that market by 2001. "The investment by A&B and Intel will help us to establish direct presence in each of the world's largest markets in order to consolidate our international position," he said.
To do that, 80-20 Software will set up offices in North America, Europe and Southeast Asia, and then use the funding to expand its R&D facilities that will remain in Australia.
But if figures are anything to go by, they are already well within the reach of their goals. Since launching the Microsoft Exchange-based technology in March last year, 80-20 Software has won some 300 clients in places as far as the Middle East and Russia, selling around 75,000 DME licences worldwide.
Stranges claims all of 80-20 Software's sales were hitherto done through its network of resellers worldwide and, even though the company also plans to build its own sales, marketing and support network in the US, it will continue to sell through its channels.
"This [investment] will bring us closer to our customers and to the distributor, reseller and developer network that will continue to serve [our clientele] worldwide," he said.