Analyst: Jay Layman
While growing its business and customers in segments such as manufacturing, distribution and retail, open source ERP vendor xTuple is building a new mobile version for its ERP, CRM, and business accounting software and features.
While growing its business and customers in segments such as manufacturing, distribution and retail, open source ERP vendor xTuple is building a new mobile version for its ERP, CRM, and business accounting software and features. The company continues to serve midmarket enterprises and smaller organizations as an alternative to traditional, larger, and typically more expensive ERP and business software options. However, xTuple is equally focused on a forward-looking opportunity in providing its ERP, CRM and accounting software on mobile devices, particularly for its traditional midmarket users.
The 451 Take
Its foundation in open source business software, the midmarket and channel partners, puts xTuple in a unique position to take advantage of the mobile device revolution, which means smartphones and tablets for midsize enterprises and the 'rest of the market.' The work by xTuple to extend its full ERP, CRM and accounting capabilities to a mobile client fits right into the trend of mobile and devops, which pulls additional stakeholders and data into enterprise software and business processes. The trend of mobile and devops is also having enough impact to be the focus of a coming special 451 Research report scheduled for Q2.
Open source ERP software vendor xTuple has grown its business and customers. It reports sales up 35% year to year in 2011 and more than 300 paying customers. With a successful channel play that now includes more than 50 partners and 25 language translations, xTuple is growing its sales and marketing efforts to more aggressively embrace the need for ERP, CRM and other business software in midmarket enterprises. Geographically, the company has mostly direct customers in North America and Latin America, while it relies on local partners in a variety of other locales around the globe. It currently has about 27 employees, and expects to grow to around 40 by the end of the year.
What is perhaps more interesting than its continued traction is xTuple's latest direction to develop a mobile client that provides the same ERP and accounting capabilities as its other offerings. Although it previously worked intensively with the open source Qt framework, xTuple has since moved away from the framework following Nokia's departure from Qt support, in favor of Microsoft technology and strategy. The end of Qt as xTuple's next-generation mobile framework has meant an accelerated R&D effort within the company to produce an alternative.
Using the open source SproutCore framework, which works well with node.js and HTML5 applications, xTuple has produced a data-intensive mobile client. The xTuple mobile client compiles on each individual mobile OS to make the application look native. The mobile browser software is also fully integrated and compliant with the company's other ERP software, including a PostgreSQL database and SproutCore-based UI. The single-codebase mobile client is described by xTuple as an enterprise-class application that goes beyond a marginal subset of functionality or rewrite to provide all of the CRM and accounting capabilities as xTuple's on-premises or cloud software. In addition, the mobile ERP software is even more modular than its traditional counterpart, allowing users to turn on only certain features, such as accounts receivable or other specific information. Much of the work on the new xTuple software has been in providing an integrated ERP system for traditional and mobile interfaces. The work has also involved some key customers and beta users, which are among those that have been demanding a mobile client. By the end of the first quarter of this year, xTuple plans to release an alpha version of the mobile xTuple client.
The company's core open source ERP software also continues to evolve, with expansion beyond manufacturing, where the company has been strong for some time, to verticals such as distribution and retail. The current xTuple 3.8 release includes incremental enhancements and features. Several customers also use xTuple's Web Portal product, a customer-facing portal with an xTuple backend and integrated Drupal CMS. In its next update to 4.0, xTuple plans to offer a free cloud version, as well as its commercial version, differentiated primarily by access to data, the company says. The commercial version, where xTuple makes most of its revenue via license sales, will feature unlimited backups and unlimited data access. The cloud is described by xTuple as just another option, with about 20 customers running its ERP software in the cloud. Traditional hosting and managed services providers are among key channel partners. xTuple, which counts U-Haul among its major customers and implementers of its software, says it is getting more inquiries from larger companies, although it is still strongest in the midmarket with customers that have 100-plus employees, where the transactive ERP system can support concurrent use.
Competition
xTuple continues to focus on a market sweet spot that includes smaller organizations and divisions on the low end, and midmarket enterprises on the high-end; thus pitting it against other SMB and midmarket options, as well as enterprise players. At its lower end, xTuple competes for customers moving beyond QuickBooks from Intuit or Dynamics from Microsoft. Larger competitors include SAP, Infor and Epicor Software. xTuple also claims to benefit from the market exit by Compiere, another open source player, acquired by Consona in June 2010. Still, other open source ERP vendors remain competitors, with European players such as Openbravo and OpenERP expanding into the US and elsewhere.
Reprinted with permission from 451 Research