Kimble Applications (Kimble) has announced a new funding round led by Accel-KKR. The funds raised were “significant” according to Sean Hoban, CEO Kimble Applications. Hoban went on to comment that the amount is: “more than sufficient additional working capital to deliver a step change in market presence, sales and customer success capacity, and product engineering bandwidth.”
So how large an investment has Accel-KKR taken, Hoban added: “They have taken a substantial share but not a majority share.”
Kimble last raised funds in 2015 (according to Crunchbase) and Hoban revealed that key existing shareholders renewed their investment at the same price. Hoban added that it was “a great endorsement when you consider that this includes Stephen Kelly (Sage CEO) and Steve Garnett (long-time member of Salesforce exec team).”
Kimble has a close relationship with Sage, its software integrates both with Sage People for HRM and Sage Financials (Sage Live as was), applications that are both on the Salesforce platform.
Accel-KKR point of view
This is not the first investment that Accel-KKR has made in the ERP market. They also have an investment in Kerridge Commercial Systems (KCS), another UK based ERP that is expanding in the US. KCS has taken a different approach to Kimble, expanding primarily through acquisition in recent years.
This might be the reason why when ET asked Kimble if they talked to Kerridge. Hoban answered: “We spoke to a number of the AKKR portfolio firms as part of our due diligence, but this did not include Kerridge.”
Kimbles approach is different, its growth has been organic, often through referral. It has one of the leading PSA solutions in the market. A fact recognised by G2 Crowd who placed it as a leader in the sector and noted they had the highest customer satisfaction score. Greg Williams, Managing Director at Accel-KKR and now a Non-Executive Director of Kimble commented: “Kimble is an innovative, fast-growing leader in the PSA software space. With best in class feature functionality and a history of high customer satisfaction, we believe the company is poised for continued success over the next several years.”
Accel-KKR has a second non-exec position on the board which will be taken by Maurice Hernandez. Based in London, he also sits on the KCS board and his experience should help both companies as they move forward. KCS have offices in more countries than Kimble, although their target markets are different. Hernandez commented: “We are looking forward to working with the team at Kimble to continue to build on its current momentum, help drive additional innovation and further expand its footprint in Europe, North America and new geographies.”
ET asked Hoban whether Kimble will look to expand to other geographies? Hoban replied: “Yes, but the main focus will continue to be North America, which is now our leading market. We are highly competitive in our chosen geographies (and there is a lot of PSA refreshes i.e. replaces going on) so we think there is plenty of room for continued rapid growth without getting spread too thin geographically.”
The inference one would draw is that Kimble are likely to add a Canadian office soon too. They may also look to open an office in Germany, where they have a small but growing customer base. Why did Kimble look to Accel-KKR? ET asked Hoban if there were other interested parties? He answered: “Yes, there were. We chose AKKR because of the cultural fit and their experience of working with European firms looking to scale in the US markets, and because they are a top PE firm which gives buyers and customers more confidence.”
The investment will also help fund product enhancements. Hoban explained further saying: “…we will use the additional engineering resources to ensure we stay ahead in augmented intelligence, project accounting, project management and resourcing – you will see this clearly when we announce our new release in May. We are also continuing to enhance our integration architecture, which is especially important for our increasingly large customers, including loading more pre-configured interfacing and functional components into our “config library” (only we have such a thing).”
What does this mean
Kimble is a major success story for the European based Salesforce ecosystem. It has grown through delivering best practice solutions to its client base in professional services companies. It already has some significant customers including Iron Mountain, Tribal, Fairsail (now Sage People) and Kainos.
Kimble is about to cross its own chasm as it looks to scale up its business. How quickly it chooses to do so is unclear. Hoban commented: “For nearly seven years, we have been quietly building a loyal customer base, proving that our vertical specialization leveraged with the breadth of Salesforce ISV ecosystem is a tremendous combination. Having a founding team of former consultants means that, compared to the competition, we have a better understanding of our customers’ business needs: balancing resource demand and supply, disciplined commercial project management, and financial predictability. We’re thrilled to have a prestigious partner like Accel-KKR to help broaden our reputation and bring our product to more organizations and new industries across the globe.”
The Kimble approach goes against the norm of rapid growth of cloud companies looking to scale quickly. It doesn’t just allow companies to download the software and have a go. It brings a best practice and change consultancy alongside its software. One of its challenges ahead might be finding the right talent to enable that growth. However, its product is a recognized leader in the space. It may look to grow a partner ecosystem from amongst some of its existing clients who have bought into not just the software but fully understand now live the best practices that flow from it.