Interesting news this morning regarding Sage 500 and Sage VARS ISM and rkl eSolutions. According to a press release issued November 19, 2013 – rkl eSolutions hired several consultants and one executive from Portland Oregon based competitor ISM. About 100 customers followed these consultants which reportedly was the entire Sage 500 customer base of ISM.
Via rkl eSolutions press release:
The company has hired several new consultants recognized within the Sage community for their expertise in Sage 500 ERP (formerly Sage MAS 500) including Stuart Blumenthal, former Vice President of ISM, along with 3 consultants: Becky Keene, Donna Gallardo and Joshua Gettman. Most recently with Sage partner ISM based in Portland, these consultants joined RKL eSolutions on November 18, along with about 100 of their existing customers.
When asked if this was a planned purchase by rkl eSolutions I received a “No comment” from both rkl eSolutions Joe Noll and former ISM VP Stuart Blumenthal.
The discussion behind the scenes is that this had been in the works for a while and that some money may have changed hands at the last moment.
What’s The Total Size of The Sage 500 Installed Base ?
Based on perhaps a faulty memory I believe Sage could have 1,500 – 2,000 Sage 500 customers active on plan. This might have been at the height of the market and prior to the announcement about Sage’s plan to sunset Sage 500 at some point in the future.
Given the information about Sage sunsetting the product in the future – I’m going to assume this on-plan user count for Sage 500 could have fallen by 30%. Using the Sage 500 estimate of 1,500 possible users x 70% = 1,050 remaining possible Sage 500 customers.
The press release mentions “about 100 new customers”. Presumably these are all Sage 500 since the consultants they presumably followed are said to all have “expertise in Sage 500 ERP”. rkl eSolutions also acquired another larger Sage partner – Waterview IT in 2010 which likely added additional Sage 500 customers. All said it’s not unrealistic to think that rkl eSolutions could be in control of up to 1/2 the Sage 500 customers.
Which makes me wonder – how long before rkl eSolutions might be in a position to offer to acquire Sage 500 from Sage? Certainly they would want to do this before the installed base deteriorated further – which could realistically happen as the anticipated “sunset” date approaches. The only question here is whether Sage would sell and risk creating a competitor to their up and coming Sage ERP X3 package which competes for a similar market.