Adaptiva has reported record revenue for the year 2021. It saw a 24% increase in annual recurring revenue (ARR). The revenue boost comes as the company announced it had transitioned all customers from perpetual licences to term subscriptions. It is good news for the company as it can now plan forward with a solid revenue stream.
The company has also announced the appointment of two new senior executives, Kristian Kalsing as Chief Product Officer (CPO) and Jeff Bergstrom as Chief Financial Officer (CFO).
Deepak Kumar, CEO, Adaptiva, said, “I’m very proud of the entire team at Adaptiva as we revamped much of our go-to-market strategy, doubled our workforce and continued to achieve incredible business results despite the many headwinds in productivity that persist in our communities.
“With a multiplied workforce, new industry leaders to serve our employees, and a new year ahead – I’ve never been more excited about Adaptiva’s future than I am now.”
Adaptiva set for further growth
Moving customers from a one-off perpetual licence fee to a term subscription makes sense. It ensures the company can budget for new products and know there is subscription revenue to support it. It also allows the company to position the cost of the product to attract a much larger customer base.
To support those new customers, Adaptiva has also launched a brand strategy. At the heart of that is a new website. The website will make it easier for customers to find information on Adaptiva’s products.
There are also two new appointments to the senior management team Kristian Kalsing, CPO and Jeff Bergstromboth, CFO. Both come with a vast array of experience, including working together at Winshuttle, a company now owned by Precisely. Both left shortly after that acquisition, and it is interesting that they are now both at Adaptiva.
Kalsing will be looking to revamp and expand Adaptiva’s product portfolio. We won’t know whether that will be through internal development or acquisition for some time.
With record revenues, will there be money for a war chest? That decision will no doubt fall to Bergstromboth. He saw Winshuttle through multiple exits from private equity deals. Will he now look to raise money to help Adaptiva grow in the short term? He certainly has the credibility that investors want to see. Perhaps he will go further and prepare Adaptiva for an early IPO? That is almost certainly a mid-term goal but would be dependent on the company having multiple years of record growth.
Enterprise Times: What does this mean?
The move to a term subscription model makes sense for a software company. It evens out the highs and lows of cash flow from product development to maintenance. It makes the product more affordable for customers and delivers a reliable revenue stream that investors like to see. All of this is shown in the record revenue that Adaptiva has announced. How much that is, we don’t know because as a private company, it doesn’t have to publish those numbers.
It is not just revenue that looks rosy. The company has also added two very experienced senior executives to its management team. Both have experience in growing companies, and both have worked together. That means they already have a working relationship that should enable them to make a difference quickly.
The only question now is, where does Adaptiva go from here? It has said it expects to see new products soon so that will cheer customers. Whether those will be developed in-house or come from acquisition, we will have to wait and see.
