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Cloud Infrastructure

E-commerce with Magento, B2C web with Drupal, PHP services, these are winning strategies in 2011 and 2012!

Frédéric Lasnier
Frédéric Lasnier
Chief Executive Officer

On account of liquididy stringency we are all facing in Europe, companies encounter greater difficulties in finding financing means for their big infrastructure and R&D projects. As the greatest IT services consumers under normal circumstances, banks are the first to lower their ambitions related to new projects in order to save their famous equity. In this high risk aversion context, the loans granted to companies will be curtailed as well.Venture capital was already showing signs of weakening during the first semester, prior to this summer’s crisis deepening. Undoubtedly, there were early warning signs of a trend that is not likely to change before the end of 2012.Being a strategy enthusiast and investor via Pentalabbs (company incubator), I asked investment funds a few questions concerning their own perspective during this difficult period. They have all reinforced my understanding from the media. They will primarily invest in e-commerce, and, more cautiously, in B2C web services. The majority of them keep away from B2B and the idea of spending money on financing hefty software R&D operations seems terrifying. Under the circumstances, software publishers, except for the firmly Cloud based-ones, are likely to encounter financing difficulties.The conversations I had with two major investment funds and a leading investment banker in Paris, whom I met at a fund-raising event at Audencia, sustain the strategy our IT outsourcing company has pursued for several years. First, we focused entirely on software publishing, which has been technology funds’ darling for a long time; then, we happily embarked on the M2M adventure, and, more recently, we provided web services (social networks in particular) and e-commerce solutions. The latter two sectors account for 70% of our profit growth in 2011. M2M has practically doubled its preponderance this year (!), at a time when the banking sector has registered a drop of 35% and when the telecommunication field has remained stable.We are all aware of the fact that, with its forecast organic growth of about 22% in 2011, Pentalog registers its worst performance in the last 5 years, but I can say that this performance could have been even lower should we not have strengthened our position in these areas and their specialized technology. In 2011, we have earned 4 major e-commerce and social network budgets, amounting to an annualized total of €2.5M. Actually, there are many reasons to be satisfied with the pursued strategy if we add the M2M profits (€1M, but from existing clients).Naturally, PHP technology requests have boomed in 2011. The demand for these expertise services exceeds by far Microsoft.net and matches Java demand for the first time in history! But we have also made progress in expertise knowledge, with know-how in the video field (in Drupal), commercial animation (in Magento), SEO constraints, and social networks (Drupal and mobile). In these business sectors, we are acknowledged as consultants and experienced contractors. Moreover, we are currently considering the proposal of two professional cloud, e-commerce and social networks offers based on Magento and Drupal for the software layers and on specialized consultants for the service layer.We are counting on the converging cloud computing, mobility, e-commerce and social network expertise directions to ensure a reliable growth engine for Pentalog in 2012.

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