Menu
People vs Product - A tale of two Aussie mergers

People vs Product - A tale of two Aussie mergers

Despite an infinite amount of reasons behind why businesses pursue merger talks, it essentially always boils down to two considerations.

People and product. With the decision to merge driven by a desire to grow and develop in the market, for channel partners, both factors can deliver on this objective.

Because people provide scope and scale, while products provide capabilities.

Product

As a Sydney-based partner, Sable37 has bet the farm on Microsoft Dynamics 365.

The software and services provider operates primarily in the home building and retail sectors,
but continues to maintain interest in developing tailored software based on Dynamics across both distribution and food industries.

In short, the cloud specialists are sourcing additional capabilities to build out its industry-specific offerings.

“We really care about intellectual property (IP),” Sable37 global managing director Martin Wildsmith said. “There’s no value in being just generic, you have to have IP.

“Customers want to deal with partners that know specific industries and that can add value to a project beyond basic software.”

Enter Payfields.

As an Australian-born independent service provider (ISV), Payfields has developed a solution for payroll which sits on the Dynamics platform.

“My Sales Manager had worked with Payfields before on a large industry-based project so we knew this would make for a perfect fit,” Wildsmith explained.

For its part, Payfields had been actively seeking an organisation to be acquired by or merge with, meaning the entire merger process was completed within three weeks, from an initial meeting to deal clinching handshake.

From a Payfields perspective, the business achieved instant scale through its offering, alongside a new home to further develop the platform.

Likewise, the benefits also flowed in the direction of Sable37, with the company acquiring an additional product that could be rolled into its existing offering, allowing for up sell customer opportunities.

“The merger was more about the fact that they wanted to partner with someone that could get them traction and customers but did not have a clear path to take,” Wildsmith said.

“It was so hard for them to go to the whole channel and work out who they could work with, so I think they struggled with that and we just thought it was an ideal opportunity.”

Martin Wildsmith - Global Managing Director, Sable37
Martin Wildsmith - Global Managing Director, Sable37

Going forward, Wildsmith revealed plans to invest further in Payfields IP, allowing the business to launch its own resale channel, adding further value to the partnership as a result.

“We are having great success because I think it’s exactly what people buy in the cloud,” he added.

“They don’t want generic accounting services, they want a solution. They want to have somebody that is delivering more and more IP for them in the long run because they want to innovate for their customers.”

For Wildsmith, consumers have become “incredibly well educated and incredibly demanding” of information and better connection to the companies they are buying from, including Sable37’s own customer base.

“The businesses that want to supply that are now scrambling because they do not have the infrastructure to do it,” he observed. “So, they are now going out and buying best of breed apps to get up fast, or they are re-platforming to go on a platform which does that.”

Regardless of the route to improving customer experience however, companies are looking to digital, and specifically cloud, as a facilitator.

“I have some customers which are very committed to the vision of digitisation and disruption,” he added.

Growing in the right way

Wildsmith said the decision to engage with a customer is based largely on the potential of the vertical’s appetite for such solutions. In short, if Sable37 does not see enough potential in an industry, there is little impetus for investment in a bespoke solution.

“I think you have to have some clarity around what you want to be good at,” he advised. “Our vision is to be world class at a small number of things, you can’t just be Australia good or New Zealand good, you have got to be world class.”

Wildsmith likened the partner experience in this sense to the entry of retail giant, Amazon, into the Australian market.

Because if local players do not have a world-class offering, they will simply be eaten by a global player that has mastered the industry in another country or region.

“We have picked a finite number of industries and have been clear that these are the ones we will invest in,” he added. “We are rolling out the same approach in other countries and are continuing to try and pull all of our IP together.

“In a retail context, this will also allow us to then deploy, enhance and expand that solution with all of those customers.”

The best example of this is Sable 37’s Home Builder One product, designed specifically for the home building industry.

Currently, it’s now attacking the US market due to the maturity of the solution and the greater opportunity for growth in North America.

“Often people stumble into things,” Wildsmith added. “Every now and then someone will go into a dark room, come up with an idea and launch it, but that is rare.


Follow Us

Join the ARN newsletter!

Error: Please check your email address.
Show Comments