Oct 06 2008

Will new Chief Construction Officer embrace ICT?

Following the publication in July of the Parliamentary Business & Enterprise Select Committee’s report Construction Matters, the UK government is now consulting industry on its proposals to appoint a Chief Construction Officer, requiring responses by the end of this month.

According to the BERR news release (2 October), this person’s duties could include:

  • Working with OGC and other organisations to promote best practice in construction procurement
  • Acting as the main point of engagement between Government and industry
  • Helping to oversee the implementation of Government policy, such as the Strategy for Sustainable Construction
  • Championing the industry’s image
  • Promoting regulatory consistency across departments
  • Helping to co-ordinate the timing of major public sector construction programmes or projects
  • Promoting innovation in the industry

At the time, I was concerned (see Construction Matters (but ICT doesn’t)), that the role of information and communications technologies (ICT) should not be overlooked in this person’s brief, having highlighted that the Select Committee’s final report barely mentioned ICT despite the efforts of Constructing Excellence to stress its potential value. I also wrote (here) about how limp the Strategy for Sustainable Construction, issued weeks earlier, was in its encouragement of ICT as an enabler of greener construction processes – in marked contrast to the Cabinet Office’s 28-page report Greening Government ICT (PDF), which talked explicitly in positive terms about ‘Thin client’ technologies and other potential ICT contributions.

Internally, UK Government (the construction industry’s biggest single client) has also been looking at improving efficiency through the Gershon Efficiency Programme, and one strand of the latest Operational Efficiency Programme (PDF) is the cross-cutting area of ‘Back office and IT’ (also mentioned in the BERR news release).

Let’s hope that this programme and Greening Government ICT, will both land in the Chief Construction Officer’s in-tray as part of the civil servant’s brief. I hope Constructing Excellence will also lobby further on the role of ICT. It has played a pivotal role in promoting the Construction Commitments, which, among other things, says “IT-based collaborative tools and communication technologies will be exploited”. Constructing Excellence is also developing a maturity assessment measure for integrated collaborative working (remember: Sir John Egan, in Accelerating Change, highlighted the role of ICT, and wanted 50% of projects to be delivered by integrated teams by 2007), and ICT-enabled collaboration is included within its ‘common processes and tools’ variable.

If you look at the Officer’s outlined duties, ICT could play a useful role in several areas. For example:

  • “promote best practice in construction procurement” – think about the efficiency savings that come from automating aspects of tendering, making information available online and reducing production of paperwork.
  • “implementation of Government policy” – from Gershon to Greening Government IT, ICT is now a cross-cutting strand within government and the Strategy for Sustainable Construction, albeit modestly, gives scope for government to encourage better ICT use across the industry at large.
  • “Championing the industry’s image” – Too often described (sometimes unfairly) as ‘technophobic’, the construction industry could at least partly transform its low-tech image by incorporating ICT more effectively into its day-to-day operations. Ditto “Promoting innovation”.

Permanent link to this article: https://extranetevolution.com/2008/10/will-new-chief-construction-officer-embrace-ict/

Oct 06 2008

Microsoft in cloud cuckoo land

I enjoyed John Naughton’s demolition of other journalists’ slavish reporting of Microsoft in yesterday’s Observer (see Slavish reporters join Microsoft in cloud cuckoo land). Some of the reporting he ridiculed as “hooey”, including Steve Ballmer’s assertion that Microsoft was somehow a ‘David’ compared to Google’s ‘Goliath’.

As reported elsewhere (eg: ZDnet), Ballmer, during his brief touchdown in London last week, announced that Microsoft would unveil its own ‘cloud operating system’ at the forthcoming developer conference, but for Naughton this latest twist in Microsoft’s grudging acceptance of web-based realities shows that “This is not a company that knows what it’s doing.” Ouch!

Permanent link to this article: https://extranetevolution.com/2008/10/microsoft-in-cloud-cuckoo-land/

Oct 05 2008

Procore

I have been having a quick look at the website of another small north American project collaboration vendor, Procore (this follows on from quick notes about Corecon, Coreworx and EADOC, among others in the past 12 months).

The website has some interesting information about the solution, but says little about the company itself beyond that it “was founded in 2003, … is privately funded by venture capital and “angel” investors [and] is located in Santa Barbara, California”. If I was buying an online service I would like to know a little more about the business, its founders, its performance, etc so that I could be reassured that it can provide a reliable solution for the duration of my project(s). Hosting is provided by Engine Yard.

The Procore solution is only available on-demand (Software-as-a-Service), and – unlike some of its US competitors who charge per-user – can be purchased on a per-project basis (to my mind, simpler to invoice and more likely to promote collaboration). The basic version is $95 per month with an enterprise version priced $295 per month. The website suggests the enterprise rate was recently reduced from $595 per month – effectively, a 50% cut. Is this just marketing, or a sign that the credit crunch has had an impact on Procore’s core market of small-scale residential builders?

Permanent link to this article: https://extranetevolution.com/2008/10/procore/

Oct 03 2008

Asite non-exec boosts shareholding

Gordon Ashworth, one-time CEO of UK-based Software-as-a-Service (SaaS) collaboration vendor Asite and now a non-executive director, has taken advantage of the company’s low share-price (down to an all-time low of 1.25p recently) to bag a further 156,250 shares at an average price of 1.41 pence. According to today’s London Stock Exchange announcement, he now holds 591,805 of the company’s ordinary shares (approximately 0.57 per cent of Asite’s issued ordinary share capital – a similar sized holding to those of CEO Tony Ryan and COO Nathan Doughty – see July posts Asite directors buy shares and More Asite director share buys).

Permanent link to this article: https://extranetevolution.com/2008/10/asite-non-exec-boosts-shareholding-1/

Oct 02 2008

Choose your “better way”

I have written about the Cabinet Office’s Show Us a Better Way competition a few times now – following its launch and then highlighting a couple of interesting ideas (Urban BIM and TfL mashup). The competition attracted around 500 entries and closed at midnight on 30 September, and we now have the chance to cast 10 votes on our favourite ideas at Show Us a Better Way (public vote), with the winner getting £20,000 to develop the solution.

Meanwhile, another ideas competition, Project 10 to the 100, has been started by Google and has an altogether bigger prize at stake – a cool $10 million! You have until 20 October to submit ideas and there will be a vote on a 100-strong shortlist in January 2009.

Permanent link to this article: https://extranetevolution.com/2008/10/choose-your-better-way/

Oct 02 2008

Business needs more SaaS

Last night I attended a meeting combining the North London branch of the British Computer Society and London Wiki Wednesday, during which there was some discussion of Software-as-a-Service (SaaS) (I also talked about Be2camp).

By coincidence, I have just come across a news item on the BCS website, Business needs more SaaS, outlining findings from a BT survey that SaaS does not feature in most businesses’ plans, despite the potential benefits. Apparently, 81 per cent of BT’s business customers did not know very much about SaaS and had not considered using it in their companies, reports silicon.com (Businesses still clueless over SaaS). BT executive Chris Lindsey says he believes SaaS has reached a tipping point: “What we’re seeing now is that it’s moving out of the innovators and early adopters to what we call the early majority.”

Permanent link to this article: https://extranetevolution.com/2008/10/business-needs-more-saas/

Sep 26 2008

The Three Es

At the beginning of the year (see 2008: SaaS will soar, SaaS will surge), I wrote about Jeff Kaplan‘s predictions for the Software-as-a-Service (SaaS) market. Amid recent financial turmoil on both sides of the Atlantic, he has again been urging people to consider SaaS in an article The Three Es That Will Drive On-Demand Services that adds ecological concerns to economic and energy cost issues. For him the “three key drivers for continued growth of the on-demand services market” are ‘The Three Es’:

  1. The turbulent economy
  2. The rise in energy costs
  3. The fragile ecology

This explicit link between SaaS and the environment is what inspired us at BIW to start the SaaStainability blog earlier this year, and it is also something I hope will be discussed at next month’s Be2camp event in London (publicised on the UK’s Building website this week here).

Update (02 October 2008): Fellow SaaS analyst Phil Wainewright also believes that, in the current financial and credit maelstrom, “now is the time to press ahead with SaaS initiatives” (read SaaS and the downturn). He continues:

“If credit remains tight, then one of the first things businesses are going to cut is capital expenditure — either because they can’t stomach the risk, or because they can’t raise the finance. The upside for SaaS vendors is that those cash-strapped businesses will find the pay-as-you-go SaaS model highly appealing — especially if it helps deliver operational cost savings at the same time. So while the credit crunch seems certain to harm the front-loaded cost model of conventional software sales, SaaS should continue to grow by picking up some of those canceled projects. …

“Some of the best-known names in the SaaS business are going to show some short-term hurt as large enterprises cut back on subscriber headcounts, especially in financial services. But if the hurt spreads into the wider economy, SaaS could become a refuge that benefits from others’ misfortunes, finding opportunities from canceled big-ticket projects and other cost constraints. Unfortunately, not all SaaS players will have enough funding to carry them through, but those with a strong enough capital base or cashflow model will be well-placed to profit.”

Permanent link to this article: https://extranetevolution.com/2008/09/the-three-es/

Sep 24 2008

Asite continues ascent

The latest interim results, covering the first six months of 2008, show that UK-based SaaS construction collaboration technology vendor Asite has continued the slow recovery it began last year (see Asite finally returns to growth). Gross revenues were up 29% to £1.067m (2007: £0.830m), and the company also inched closer to breaking-even with losses for the period reduced significantly to £0.048m (2007: £0.273m). Assuming this trend continues, Asite may finally declare a full-year profit at the year end – something I once thought was still another year away.

Much of the turnover growth was achieved in the UK market (up 30% to £0.935m from £0.717m) – a change from the last time I examined Asite’s figures, when the UAE market was boosting the company’s revenues – though it is probably too soon to see if recent uncertainty in the UK economy, and in the property sector in particular, will have had any impact.

Asite’s share price rose yesterday to 1.625p on news of the results, having twice hit an all-time low of 1.25p amid general Stock Market turmoil in the past week.

Permanent link to this article: https://extranetevolution.com/2008/09/asite-continues-ascent/

Sep 22 2008

Aconex gets private equity injection

The Australian business press (eg: Melbourne’s The Age, Australian IT, MIS Australia, Smart Company Briefing) has been busy reporting news that Australia-based SaaS-based construction collaboration technology vendor Aconex has secured a AU$107.5m (£48.8m) private equity investment (see also Aconex news release and listen to ZDnet Australia podcast). Not since the reckless days of the dot.com boom have we seen a deal of this magnitude in the construction collaboration space – the last significant transaction was Autodesk’s 2006 acquisition of Constructware for US$46m (see post).

After Aconex sought expressions of interest from a number of competing investment businesses, US-based technology investor, Francisco Partners (which describes itself as “focused exclusively on investments in technology and technology-enabled services businesses”), was selected to make an investment, but “details of the deal, said to be one of the biggest of its type, were not released”.

Francisco Partners is taking a minority equity stake in the company but Aconex co-founder Leigh Jasper (now Aconex’s CEO*) declined to reveal its size: “We’re not disclosing the exact valuation on the business but suffice to say it’s a valuation position to take a $107.5 million position without overly diluting existing shareholders,” he said. According to Smart Company, the deal was approved at a meeting of existing Aconex shareholders on Friday evening; “The company has around 100 investors, mainly high net worth individuals and families and friends of Aconex executives” (Aconex was, of course, engaged in a protracted legal dispute with some of its shareholders that was eventually settled out of court in May this year). Silicontap.com said Francisco Partners would add two people to the board of Aconex (it currently has five members).

MIS Australia meanwhile speculated that the investment valued Aconex “at between AU$215m and AU$300m”. Aconex apparently posted revenues of AU$42 million (£19.1m) in 2007-08, so, if the valuation is accurate, it rates Aconex somewhere between five and 7.5 times revenues – not far short of the 7.6 multiple achieved by SaaS web conferencing business WebEx when it was acquired by Cisco Systems last year (see also my post speculating about 4projects’ valuation after its July 2007 MBO).

Aconex chairman Martin Hosking noted that Francisco Partners had experience in “assisting technology companies to structure and prepare for initial public offerings”. However, he told MIS Australia that the company was unlikely to raise further capital through private placements; instead, it may look to an initial public offering if it needed further funding to drive growth, “However, Aconex was not looking to list anytime soon.”

Francisco Partners has $US5 billion ($A6 billion) invested through its private equity funds. Among other software businesses, Francisco Partners has previously invested in Primavera (a US-based provider of construction-related software) and Mincom (a Queensland-based software house also active in the construction and resources markets).

Aconex said that in anticipation of the funding package, it had put together a team that was evaluating acquisition opportunities in the US and Europe. Leigh Jasper told Smart Company that the recent global economic slowdown could force some competitors on to the sale block. “It’s not about getting a cheap acquisition, it’s about getting the right acquisition,” he says. He nominated South America and Eastern Europe as particular expansion targets.

Aconex was also planning investment in product development to create complementary products on the Aconex platform, a process that it said could create about 50 jobs in its Melbourne software engineering unit.

[* Until recently, Leigh Jasper and Rob Phillpot were joint managing directors of Aconex. Rob now holds the position of Director, Business Development, according to Aconex’s website.]

Update (25 September 2008): Paul Ryan, editor of Anthill Magazine, has blogged about the deal (here). Aconex Chairman Martin Hosking believes the interest shown in Aconex by several US-based private equity firms demonstrates that there is still plenty of money and appetite for Software as a Service (SaaS) companies that are not over-exposed to a single geographic segment. Global private equity firms are still eyeing later-stage, cash-flow positive companies.

Update 2 (02 October 2008): Aconex CEO Leigh Jasper has blogged about the deal in the Aconex blog (see In the News…), talking about adoption of online collaboration and strong international SaaS market growth: “A report … by International Data Corporation estimated that the overall SaaS market will grow at a compound rate of 32.0% annually”.

Permanent link to this article: https://extranetevolution.com/2008/09/aconex-gets-private-equity-injection/

Sep 22 2008

Construction Computing Awards 2008

Shortlists for online voting in 21 categories of the 2008 Construction Computing Awards (see post) have been announced, with several companies making it into the finals of multiple categories, including: Autodesk (12 categories), Causeway (eight), RedSky IT and the Content Group (six each), Bentley and Tekton (five each), and 4Projects, BIW Technologies [my employer], Graphisoft, MPS, OCE and Tekla (all four each). Cast your votes online here before 10 November.

Permanent link to this article: https://extranetevolution.com/2008/09/construction-computing-awards-2008/

Load more