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MGI 360 Ratings: FastSpring in eCommerce Platform JAN 30 2017

INITIAL RATING: We are initiating coverage of Merchant of Record supplier FastSpring (legal name Brightmarket LLC) with an MGI 360 Rating of 48 and a Neutral outlook.

OPINION: We estimate revenues of around $20 Mill growing at 15% per year. Company strategy focuses exclusively on software and other digital deliverables within an SMB context. FastSpring has a very loyal following among Mac software publishers - a market company dominates. Company sells its offerings via a combination of direct, online and partner channels but the size of the channel is a barrier to a more rapid growth. While the market offers attractive growth options, the firm has been deliberate in its approach to new opportunities, focusing on managed expansion. The business is operating at above break-even. Benchmarking details are in the research note attached below.

USE CASE: FastSpring sweet spot is in facilitating online sales of digital products and services internationally for SMB software and digital services providers.

COMPANY DESCRIPTIONFastSpring 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, fullfilment, subscription management, payment processiing, taxation and compliance management. Current management team began its tenure through a private equity transaction. We estimate FastSpring headcount at around 60.

COMPETITORS: Digital River, Avangate, PayPro Global, clever bridge 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 subscription research, advisory engagements, industry studies and ratings, MGI Research helps clients identify opportunities for reducing IT costs and minimize technology risks. MGI Research analysts work closely with user organizations to create practical strategies for new technology initiatives such as mobile, virtualization, SaaS and cloud computing and make timely go/no-go IT investment decisions. For additional information, to purchase a subscription or to schedule a confidential consultation, call +1 888 801-3644 or visit www.mgiresearch.com http://www.mgiresearch.com

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