MGI Research

Tuesday, Mar 31st

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MGI 360 Ratings - FastSpring in E-Commerce Platforms

MGI 360 Ratings LogoSUMMARY: We are increasing the MGI 360 Rating of Fastspring in the Commerce and Payment Platforms (CPP) market from 48 to 52 and maintain a Neutral outlook. 

OPINION: Product score improved from 8.80 to 9.30. There have been meaningful additions to the management team and the score in this area improved from 10.60 to 10.69. The channels score is up from 9.89 to 9.97. Strategy rating jumped from 10.36 to 12.57 reflecting crisper positioning of the business. Finance score improved from 8.05 to 9.78 as Fastspring gained improved financial stability under new ownership. We estimate net revenues of around $40 Mill growing at 40% per year and operating at just above break-even. In 2018 private equity firm Accel-KKR acquired majority control of Fastspring. The PE transaction in our view brought fresh management and renewed focus on process, operational discipline and a European presence. Reference checks indicate a customer base that exhibits increased satisfaction with the level of service. 

USE CASE: Software, gaming, digital goods and services companies with B2C orientation and revenue streams from $1Mil to $10Mil, looking to grow internationally.

COMPANY DESCRIPTION: FastSpring provides an online eCommerce platform that helps small and medium size publishers of software and other digital goods and services monetize their offerings on a global scale. The company all-in-one monetization-as-a-service offering includes components for payment processing, invoicing, fulfillment, subscription management, payment processing, taxation and compliance management. Current management team began its tenure through a 2018 private equity transaction. We estimate FastSpring headcount at just over 100, with 10 based in the recently established Amsterdam office.

COMPETITORS: 2Checkout, BlueSnap, cleverbridge, Digital River, Nexway, PayPro Global, Stripe and best of breed Agile Monetization tool suppliers.

ABOUT MGI 360 RATINGS

MGI 360 Ratings is a comprehensive system for evaluating technology companies. IT organizations use MGI 360 to track suppliers, assess purchasing risks and identify promising new vendors. Vendors utilize MGI 360 to track their markets and evaluate partners. Institutional investors use MGI 360 for independent assessment of tech companies. MGI 360 ratings help lower costs, save time, reduce risks, and identify new opportunities.

The MGI 360 ratings are on a scale from 0 to 100 and reflect company opinions of MGI analysts in five key areas on a scale of 0 to 20:

  • PRODUCT: How strong is the product competitive position
  • MANAGEMENT: How competent and experienced is the management team
  • CHANNELS: Does the company have a sales capability and channels needed to bring products to market?
  • STRATEGY: Does the company have a realistic view of the opportunity and a compelling strategy for success?
  • FINANCE: Is the company growing and profitable

Each of these key criteria is subdivided into numerous sub-categories. In total, over 149 criteria are combined to generate an MGI 360 rating in each specific market space. Companies can have one or more MGI 360 rating - one for each market. MGI 360 ratings are revised as important developments occur. While the MGI 360 rating process is comprehensive, this scoring system is not meant to be a predictor of company solvency, liquidity, absence of accounting fraud or stock performance. Access to MGI 360 Ratings is by subscription.

ABOUT MGI RESEARCH

MGI Research is an independent industry research and advisory firm focused on disruptive trends in the technology industry. Through ratings, industry benchmarks, best practices groups, subscription research, market forecasts, advisory engagements, industry studies and conferences, MGI Research helps clients identify opportunities for reducing IT costs and minimize technology risks. MGI Research analysts work closely with business and technology organizations to help make timely go/no-go IT investment decisions, optimize vendor relationships, and create practical strategies for new initiatives in agile billing, payments management, order management, CPQ, contract lifecycle management and other elements of agile monetization platform (AMP).

For additional information, to purchase a subscription or to schedule a confidential consultation, call +1 888-801-3644 or visit www.mgiresearch.com 

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