Intuit Offers to Buy Entellium Assets
December 1, 2008 by Jimson Lee · Leave a Comment
Is Intuit, the makers of QuickBooks and QuickTax, about to enter the hosted CRM market?
It appears so, as Intuit is in the works to purchase Entellium, the company where the CEO and CFO were charged with wire fraud. Their competitors used this opportunity to steal Entellium’s customers!
That’s how fierce and competitive the CRM and SaaS marketplace is today. Recurring revenue is where it’s at.
On a fire sale, anyone is lucky to get 10 cents on the dollar. In a SaaS environment, the Datacenter hardware depreciates faster than Usain Bolt. So it must be Intellectual Property and customer base they really want.
Here is a partial article from TechFlash.com.
Financial software giant Intuit has entered into an agreement to gobble up the assets of Entellium, the troubled Seattle Internet startup whose former CEO is in federal prison awaiting trial on wire fraud charges.
The deal has not been formally approved, but Intuit spokeswoman Diane Carlini confirmed Sunday night in an interview with TechFlash that the company is pursuing an asset purchase. “We have made an offer for certain assets,” said Carlini. She did not have any details on the purchase price, though one source who spoke to TechFlash put the figure at about $8 million.
That is well below the more than $40 million that Entellium raised from top venture firms such as Ignition Partners, Intel Capital and Sigma Partners.
The asset sale is the latest twist in the ongoing saga of Entellium, which has imploded in the past two months after top executives Parrish Jones and Paul Johnston were arrested on wire fraud charges for inflating revenues over a number of years.
In an interview Friday, acting Entellium CEO Charles Miller declined to comment on speculation that the company would be sold or file for bankruptcy. However, he indicated that news was coming, telling this reporter to check back later this week.
The asset purchase could add fuel to Intuit’s attempts to compete in the hosted customer relationship management sector against the likes of Salesforce.com and Microsoft. Intuit made a push into that arena in September with the launch of a new offering that complemented its QuickBooks financial accounting product. (Ironically, financial accounting has become a hot button issue in the Entellium case since we reported that audits were never completed at the company.)
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About Jimson Lee
Jimson is a freelance industry analyst, with over 25 years experience in the IT industry. Prior to joining CRMHelpDeskSoftware, he spent 4 years as a Senior Consultant at Sierra Systems Group, part of Golden Gate Capital, a leading private equity firm with $9 billion in capital under management. Jimson currently resides in Rome, Italy.
