Max Ertl and Jim Roberts of DocuWare discuss the company’s 2019 performance, the Ricoh acquisition, and DocuWare’s cloud-based document management offering.
Last year was a year of change at DocuWare as well as a successful one. It started in January with a new executive management team in place followed by an announcement in early July that it had been acquired by Ricoh. It ended with one of DocuWare’s best years ever as it achieved 54.8 million euro in total revenue, an overall growth of 17% over 2018. Much of this growth was attributed to its cloud offering, which grew 71% year over year and now accounts for 13.4 million euros of DocuWare’s 2019 revenues.
Because most of DocuWare’s sales here in the U.S. are driven through the independent dealer channel, we jumped at the opportunity to interview Max Ertl, president, sales and marketing and Jim Roberts, president, about the company’s 2019 performance, its cloud offering, and the Ricoh acquisition. These are edited excerpts from that conversation.
Max Ertl Jim Roberts
CR: What were the drivers behind DocuWare’s excellent performance in 2019?
Roberts: Ultimately, an accumulation of a lot of efforts to get better at executing our strategy. There wasn’t one single thing you could point to that say, “Hey, we did this in ’19, and this changed everything” because we’ve been making investments in the same areas now for many years. We’ve been investing to increase our partner channel for quite a few years and seeing nice results. We invested in our cloud infrastructure and are now seeing a large acceleration in market access due to the cloud.
Ertl: We are at the right place with the right product at the right time in the right channel. The strategy to develop a public cloud offering, which has the same features and functions and is more than competitive with every on-premise document management system was big. The second was building a strong sales channel not only in DocuWare but also with our partner community. Some of our partners have been with us for 20 years. We told partners for many years, “Invest in knowhow and invest in training, because our time will come.” We have great employees, a great sales organization, and a great marketing organization.
CR: What’s been the biggest change with the new leadership at DocuWare and how instrumental have you been in driving DocuWare’s 2019 results?
Roberts: The mantra of our new leadership all along has been to continue to execute our existing strategy. It hasn’t been like new leadership caused a wave of change in the organization. If anything, I think it feels like a natural progression and a continuation of the DocuWare DNA, maybe with an emphasis on improving our core execution.
CR: Let’s talk more about your cloud offering, which has been a huge driver for growth. Why do you think that is?
Roberts: Cloud makes document management and workflow automation solutions accessible to a greater percentage of the marketplace. It’s an easier entry point from a price perspective, but it also hits on what most of the market wants with mobility and security. The foresight to have invested in the cloud in years past is paying off now, as we’re seeing an acceleration in adoption in the SMB space.
CR: I want to go back to when you were talking about growth on and in SMB space and how those folks are more open to a cloud solution. What percentage of placements are coming from SMBs and is that moving upwards versus say enterprise customers?
Ertl: I don’t have a specific number to share with you. Broadly we’ve always been able to sell DocuWare into the entire market, whether they’re small, medium or large, or even enterprise-type accounts. The largest share of our business has always been within SMB. What we are seeing through new customer acceleration is that the adoption rate in SMB is picking up.
CR: Security is an important element of any kind of cloud offering, are you leveraging that with customers?
Roberts: Absolutely. Customers are generally happy to find out that we have a secure cloud infrastructure. The awareness that they could choose cloud over on-premise, and offload the costs and labor associated with the IT infrastructure, is music to a lot of companies’ ears.
CR: One of the biggest news stories of the year in our industry in 2019, was Ricoh acquiring DocuWare. Has that changed things?
Roberts: Well, it is early days and there hasn’t been a significant change to what we do day to day at DocuWare. What we do is integral to Ricoh’s strategy. Our business was set up as an independent operating company within the Ricoh family. As a result, we intend to keep growing DocuWare in the method that we’ve been for years, which is to sell through our partner ecosystem and continue to expand that way.
CR: Any concerns from partners who are not aligned with Ricoh about that relationship?
Roberts: We continue to reinforce the message that we continue business as usual just like we have in the past. It’s our desire to maintain all our partner relationships just as they have been.
CR: Any thoughts as how you’re going to top 2019 in 2020?
Roberts: It’s our goal to continue to do just as we have in the past, executing our plan to create further reach, expanding our partner network, and strengthening many of our existing relationships within the channel.
CR: Are there any questions I didn’t ask that you wish I did?
Ertl: Where should dealers invest and why? Then I can say, invest in digitalization and document management. I always say, we do not only offer products, we offer something close to a franchise. We don’t give [partners] the product and say, “Good luck,” we give them sales support, sales enablement tools, and marketing support. For many we help them change from a product-selling company into a solution-selling company. It’s not free. They have to invest in resources. They must be willing to change some of their processes. If they are willing to go in this direction, then they cannot find a better partner than DocuWare.
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