QuantiQ has acquired the Dynamics business of Profile Enterprise Solutions in a move which CEO Stuart Fenton claims will bolster the firm's recurring revenue.
The deal will see 40 Microsoft Dynamics partners move over to QuantiQ, and Fenton said he wouldn't be surprised to see similar deals in the market because of the rate at which Microsoft is innovating with Dynamics.
"With Dynamics moving to a fully SaaS (software-as-a-service) application you are now selling a product that is evolving," Fenton (pictured) said. "The platform is updated each month and twice a year it goes through major updates.
"It rewards partners with much deeper skills and more scale to support the client, but I have never seen this relentless pace of development from Microsoft in the nearly 30 years I have been in the IT industry and I think the smaller firms are going to struggle to keep up.
"At Profile the owner recognised they were under scale and couldn't achieve the success they wanted, so they started talking to us about how they can extricate themselves from the business. I think those trends will continue."
Fenton said that QuantiQ is currently operating at a run rate of around £20m, adding that he expects the acquired business to have made a tangible contribution to QuantiQ, via recurring revenue, in around three years.
He also said that QuantiQ will continue to eye up acquisitions of this nature, but added that the firm has tended to opt against full acquisitions.
"We have primarily been focused on organic growth and that is our goal," Fenton explained.
"That is our number-one focus but with acquisitions we take an opportunistic approach.
"If an opportunity comes up that is similar to what we have just done, we will take that approach, but we are not looking at big strategic acquisitions just yet.
"We have considered them in the past but each time we discover that the businesses aren't worth what they want to be paid."
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