September 9, 2008
Hoping to make a quick splash in the value-added reseller pool, startup Sparxent is laying out an aggressive growth strategy -- one that includes acquiring five companies by the end of the year.
Sparxent came out of stealth mode late last month with two acquisition announcements: NetworkD of Newport Beach, Calif. and Arbyte of Moscow. Financial terms of both transactions were not disclosed. Co-founder Steve DeWindt said the company is on track to close three additional deals by the end of the year. NetworkD and Arbyte represent approximately $75 million in sales, according to reports. Along with business partner Dave Taylor, DeWindt said Sparxent's platform-agnostic approach will be to consult with customers to offer business or IT solutions that are closely related to their existing environments. "Although the middle tier of the market makes up nearly half of overall IT spending, there are few dedicated IT resources focused on this segment," said DeWindt in a statement. "We feel that there is a unique opportunity to create a new business model through the marriage of consulting, solutions, integration, development, and services that are solely focused on the under-served mid-market." For example, DeWindt hopes to attract those 300-person clients who dare not call and be overwhelmed by corporate-level VARs like IBM Global Services. "Mid-market companies in the past have had to choose between traditional VARs with deep expertise in a single vendor's solution, or VARs that sell a broad variety of software but have little expertise in creating integrated solutions for the customer," the company said in a statement. As a VAR in development, DeWindt said Sparxent will rely on Web 2.0, rich client technology, and the latest provisioning of the Internet to service a wide selection of customers. DeWindt said Sparxent also has strategic partnerships with BMC, CA, Cisco, EMC, Hewlett-Packard, Juniper Networks, LANDesk, and Microsoft. However, it's the geographical aspect of Sparxent's acquisitions that the company is really counting on as a true differentiator. "By acquiring established, local IT providers around the globe and bringing them together under one umbrella, Sparxent will act as a single source for IT -- providing the broadest array of expertise and tools to the middle market," said Taylor in a statement. Initial funding for Sparxent came from vSpring Capital. DeWindt previously served as director of worldwide reseller sales at Intel; co-president of Computer 2000 AG; CEO of AmeriQuest Technologies; and co-founder of BlueRoads. Taylor was part of the original management team at LANDesk Software. As a contrast to the reseller market, InformationWeek has produced an analysis of the classic "buy or build" question for small and midsize businesses in need of software apps. Download the report here (registration required).
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