When salesforce.com invested in FinancialForce a few years ago, there was keen interest in how this would help the company grow. There’s never been much clarity around those numbers since the parent company of FinancialForce, Unit4, doesn’t break out the individual numbers of operating divisions. That is a bit clearer now since in its last reporting period, Unit4 gave the following information:
FinancialForce.com, the cloud applications company, today announced record results for calendar year 2012. Within one year, FinancialForce.com increased annual revenue run rate by more than 90 percent, from 9 million in 2011 to 17 million in 2012, significantly expanding their customer base in Accounting, Professional Services, Billing and Media. Additionally, the number of customers using both Accounting and Professional Services Automation (PSA) grew by 120%. Finally, 2012 also saw the expansion of FinancialForce.com’s enterprise customer base as average contract value rose by a significant percentage.
90% of the company’s growth is due to larger deal sizes.The company also expanded its staff globally by 60%, across the United States, United Kingdom and Spain. As cloud spending continues to be a top priority for CFOs and CIOs, FinancialForce.com is poised for aggressive growth again in 2013 and projects more than 100 new hires across the globe to keep up with its rate of growth.
Update – apparently it was an incorrect statement in the Financial Force statement about 90% of growth coming from larger deal sizes. Something to do with misinterpreted statistics.
The mid market is one that is very underserved by cloud accounting/financial vendors – NetSuite used to play in this space but is rapidly moving up the food chain leaving FinancialForce and Intacct to scrap over the mid sized customer base. These results are indication that there is an appetite in the marketplace for midsized organization to move to the cloud It’s also interesting to see that even FinancialForce is seeing a move to larger organizations as larger deal-sizes become more prevalent.
As expected, FinancialForce is enjoying the network effects of having customers using both financial and professional services automation products – and I’d expect this trend to continue – I’d also expect the company to add additional services that further increase the network effects of discrete, but closely integrated solutions.
Congrats to FF. Those numbers are higher than many were expecting I’m sure. It gives them some credibility to build an ecosystem around their product which can take them to the next level.
Thanks for the kind words, Ben. And great comment, Dan. We are, indeed, building our ecosystem as we enable our customers to extend and integrate our apps even more easily, and as we enable a community of prospects, users, developers, and more to share, learn, and contribute.
This year will bring us closer to our customers, our customers closer to each other, and them closer to their customers and vendors in ways never before possible.
Great things in 2013!
David – if it ever comes up we’ve built an integration from FinancialForce PSA -> Xero.com Integration. I can see room for lots of other addon’s in the FF space
We are starting to see the emergence of this ecosystem around FinancialForce – here’s a list of some of these “FF Ready Apps” – http://www.financialforce.com/platform-solutions/partner-integrations/financialforce-ready-apps/ . We are slso seeing a growing community of implementation partners.
You are indeed correct in pointing out the need for a greater choice of cloud based solutions in the mid-market. Another problem in the mid-market is just the cost of existing solutions – traditional or cloud. Companies that outgrow entry level offerings like Quickbooks, Xero, Peachtree that cost $2-3k per year, face the daunting challenge of moving to a mid-market system at prices north of $50k per year with $100k+ not being unusual. So there is a huge gap in the lower mid-market with respect to affordability. My company Versaccounts is targeting mid-market businesses that fall into this gap – too big for entry level, too small for traditional mid-market. We offer a pure multi-tenant cloud ERP solution for a flat fee of $12k per year. Unlimited users and all the functionality including Financials, Project Accounting, Inventory Management, Purchase-to-pay, Order-to-cash, BI and more. Still building out our Early Adopter Customer base with General Release targeted for early year, but even now we see a good appetite for solutions targeting this segment.