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January 2015 » Posted by: Norman Graves

What Now for Ektron?

Despite showing spectacular growth during the early noughties Ektron has, in more recent years, struggled to maintain its market share as a content management system (CMS) vendor. Perhaps the recent announcement that Ektron has been bought by California-based private equity firm, Accel-KKR comes as little surprise then. The move follows the firm’s acquisition of a stake in Ektron earlier in 2014, which gave it the rights to buy the company at a later date – a right that it has now exercised. 

The acquisition also follows a period of management turmoil within Ektron, which saw the departure of Ed Rogers in 2011 and has been accompanied by flattening sales over that time – though it is not possible as an outsider to determine exactly which of these is the cause and which is the effect. 

The deal places a value on Ektron of $52 million, far below the value it was perceived to have just a few years ago. This number should also be set against Sitecore’s foray into private equity in 2011 which was rumoured to be in the region of $100 million for a minority stake in the company. It was this investment that allowed Sitecore to leverage its international distributor channel into a network of subsidiaries, to open offices in China and the Far East, and to sustain an investment into the technology and acquisitions, which has clearly left Ektron behind.

Since around 2010 CMS vendors have sought to downplay their core content management competences and to focus instead on features such as email marketing and marketing optimisation, all of which are built on top of the core content management engine. Where Sitecore emphasised their all-in-one approach, with functions such as analytics and email marketing being integrated into the CMS, Ektron adopted a ‘best of breed’ approach based on integrating third party products. Sitecore’s recent acqusition of Commerce Server only serves to emphasize the difference in approach which stems largely from economic necessity. Without the funds available to Sitecore as a result of its private equity investment, Ektron had little choice but to rely on third party offerings. More recently it has attempted to change tack somewhat by introducing a SaaS offering which adds marketing optimisation functionality to sites which are managed by any content management system with their Digital Experience Management offering.

Interestingly, in the same week that Accel-KKR acquired Ektron they made another foray into the CMS space to buy into Swedish vendor EPiServer. Many speculate that Accel-KKR are planning a merger between the two vendors but it remains to be seen what lies behind the firm’s strategy and what lies in store for the Ektron product.
 
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