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SaaS Software Company – Product Lifecycle Management Solutions for Engineers – 16 Years in Business – Recurring Revenue – Low Churn

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Website Closers® presents an industry-leading software that has successfully been in operation for 16+ years. The target is a simple-to-use, Product Lifecycle Management (PLM) software built for engineering and manufacturing firms. Engineering data management is a specialized discipline, and this company has developed a unique and secure niche in the PLM software industry.

The PLM Market

The PLM market meets in the middle of engineering computer-aided design (CAD/PDM) and manufacturing resource planning/manufacturing execution systems (MRP/MES/ERP). PLM manages a product’s technical content, controlling design release and revision in cooperation with purchasing, production, quality, marketing, and other internal operations.

The market has been dominated by a few large companies, including Oracle Agile, PTC, Aras, and Arena, along with smaller specialist products for niches like aerospace and defense, medical devices, consumer packaged goods, and fashions. The small- to mid-sized technology market, where this company operates, accepts an affordable solution that eliminates high-cost in-person sales and support teams in favor of web-based marketing and remote product support. There are few competitors in this low-cost segment, and a vast number of prospective companies that must otherwise cobble together home-grown solutions from standard office technologies.

Customer Base

The typical customer for the company is a small-to-mid-sized engineering department (or workgroup within larger enterprises) that is focused on the design of moderately complex technology-oriented products. Many of these are doubtful of both cost and security of public cloud (“SaaS”) PLM solutions, and prefer – or may be contractually required – to keep their mission-critical intellectual within their private network.

The software can be used in various industries for an extensive range of applications, including:

  • Consumer electronics
  • Industrial electronics and machinery
  • Legacy and new energy
  • Aerospace and defense products, and small aircraft
  • IT & communications systems
  • Medical devices
  • Automotive and transportation components

More than 80% of revenue is derived from recurring annual support subscriptions. Most of the remaining income is from one-off perpetual license purchases. The business boasts excellent reviews, high customer retention rates, and low maintenance and support costs. At the end of 2022, current customers’ lifetime revenue averaged over $41,000. This unique software requires significant domain knowledge to replicate, coupling exceptional margins with a strong barrier to entry.

Marketing & Scale

Lead generation comprises SEO, Microsoft paid search advertising, and paid directory listings. Little digital marketing has been done by management, providing immense scale opportunities for a buyer.

As successful as the business is, the owners have identified several additional services that could be added to the company. Some enticing prospects are product development, internationalization, and support for Mac, mobile, and cloud integration via .NET Core. Additional recurring services such as cloud hosting and server management could prove highly lucrative. Consulting services may be expanded to legacy data migration, application admin/user training, and configuration management best practices.

Operations

The business enjoys healthy revenue throughout the year. Many companies acquire new software tools in the first half of the year, while government contractors have an October annual business cycle.

The business has no long-term obligations: out-sourced resources such as phones, network, web server, payroll, etc. are month-to-month. There are no leases, inventories, capital assets, real estate, or other encumbrances.

Company Overview

Human Capital

Primary business tasks involve the following:

  • Customer support, primarily via email
  • Subscription renewals, including renewal notices, invoicing, A/R processing, and license issuance
  • Existing customer incremental sales, such as new seats and custom development
  • Website maintenance, SEO, and IT operations
  • Application development and maintenance
  • Sales activities like web demos and user training
  • Marketing and advertising.

IT infrastructure, payroll, and tax responsibilities are outsourced as necessary.

Summary

Ideally, a buyer has domain expertise in engineering configuration management practice and hands-on experience in a moderate or high-volume manufacturing environment. Other necessary skills can be hired or outsourced. Contact Website Closers today to learn more about this exciting acquisition and its immense potential in the right hands.

This Software Business is Represented by:

WebsiteClosers.com

Technology Business Brokers

WC 3022

Asking Price
$ 2,000,000
Cash Flow
$ 512,744
Gross Income
$ 542,312
Year Established
2007
800-251-1559