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Vinasty – the official release

This is the latest episode of the Vin Murria saga (or Vinasty as one of our readers put it – more drama than Dynasty tho without the shoulder pads) and we quote verbatim the official statement issued earlier today (Thursday) by IRIS…

“IRIS Software Group, which is now listed as one of the top business software houses (top 6) in the UK with market leading positions in the Accounting, Legal and Not For Profit sectors, has announced details of its new Group management structure, following the recent merger of IRIS and Computer Software Group.

Martin Leuw, previously CEO of IRIS, has been appointed as Group Chief Executive of the newly enlarged IRIS Software Group. Martin joined IRIS in May 2001 and has successfully built the business from £9m to well over £100m revenues, following the merger. Neal Roberts, formerly IRIS‚ CFO, becomes the Group CFO. Neal will be responsible for the new Group's Finance, Legal and HR operations in his role as Chief Financial Officer. He will be supported by Barbara Firth, previously CFO of CS Group, who takes on the newly created role of Acquisition & Integration Director.

Vin Murria, employed as Chief Executive Officer of Computer Software Group until the deal was completed on July 3rd has decided to step down in order to pursue fresh projects. Vin was instrumental in achieving the rapid growth of the CS Group business, and in the last four years of her time with CS Group helped the business grow from a £2.6m market capitalisation to, following the merger with IRIS, a combined valuation of £500m.

The enlarged Group will be divided into five Business Units to provide a dedicated customer focus and to create Centres of Excellence for both product and service:

Accounting Practice Solutions – MD, Robert Salvoni (from IRIS – no change)

Legal & Compliance – MD, Arlene Adams joins the Group on July 9th

Not for Profit & Business Solutions – MD, David England (from CS Group – no change)

Accounting & Business Solutions – MD, Stuart Dawson (from IRIS – no change)

Payroll & HR – acting MD, Martin Leuw (from IRIS – no change)

For the Group's customers, it will be very much 'business as usual'. During the coming months, the new business will take the best practices from both IRIS and CS Group to create the highest-quality product sets and market leading levels of customer service, which both organizations have built their reputations on.”

As ever, readers are free to comment on this story.

I would just add, as I noticed some people taking exception to my remarks about Vin Murria's impact upon the market: an impact doesn't necessarily have to be positive. The Chicxulub Meteor made more impact upon the dinosaurs in one minute than the previous 200 million years of evolution (I know, this will offend creationists).

22 replies on “Vinasty – the official release”

Hi Charles,
What an opportunity to dust off the old joke book.
What is the similarity between Vin Murria and the Chicxulub Meteor?
……they both changed the structure of old dinosaurs.
Having said that the Chicxulub Meteor didn’t actually kill the dinosaurs (unless it hit one of them on the head on the way down) but it did create an environment where they couldn’t survive. Perhaps your analogy was more apposite than you intended.

There is no denying that Vin Murria has changed the face of the legal IT market and in particular the PMS market. As a ‘competitor’ we welcomed Vin and the CS Group to the community on the basis that the CS Group has brought a new approach and offering to the market. Despite this we have continued to leverage our longevity and experience of the UK Legal IT Market and invested money, blood, sweat and tears in to the development of Axxia DNA which looks set to change the face of the PMS market. Our approach has been driven by our understanding of our customers requirements and the demands and requisites of the legal industry as a whole rather than that of investors.
We wish Vin well in her future ventures.

The only “new approach and offering to the market” the new group has brought to the legal market is worry for the customers of AIM, Videss and Mountain. The idea that all three PMS' will continue to be developed is ridiculous. The only way the IRIS Group will achieve the goals of its investors is by rationalising the sales, finance, support and development functions of all three organisations, and they appear to have made a start in finance. It may be that the group have not yet decided which PMS will prevail, but be sure, only one will.

Actually that's 4 PMS products as the Laserform Partnership Suite is still being actively sold and secured a couple of recent wins.

Well a few points from the inside so to speak, following the recent post about structure etc.
1. I think we can take it as read, despite the recent announcement, that it was originally meant to be a board of three i.e. two from IRIS & Vin.
2. Clearly there was a row and IRIS came out on top and Vin has gone – says something for who’s the stronger of the two in the merger.
3. From the employees perspective in Legal it doesn’t look well managed at all, one minute press releases about how wonderful the merged team of three main board directors will be, next minute corporate history is changed and guess what – no mention of Vin as M&A Director, in fact it never existed as a role and she’s off to pursue other interests!!
4. So how’s the market taking it:
– most sensible people must see it for what it is and are indeed commenting as such i.e. no company makes a statement about board roles when a merger is announced if they don’t think they will actually happen and it’s already been agreed that an individual has decided to pursue other interests. So it must have been a falling out over something be it strategy or personalities.
– IRIS’s PR got caught out completely as the story had leaked before they were ready to add the corporate spin.
– in a rather odd attempt to put things right they tried to position it as though this is what had always been intended accept nobody internally or externally believes it.
5. So where does that leave Legal then. Well as one ‘insider’ has already put it changes are happening but what’s likely? The choices appear to be:
– carry on with Vin’s strategy of separate companies but everyone realises this isn’t great news because there are 4 different development strategies, 4 different sales teams, 4 different support teams etc etc. The market is also small enough to know which companies are in the Group and which aren’t. Also it causes uncertainty for customers as they wonder which software company will come out on top.
– Integrate all of the companies into one Legal Division with one product. Not great for staff (plus users of the other products) as 4 roles for example are made into 1.
6. Employees don’t know for sure but there seems to be lots of activity in terms of everyone trying to push their product to the front – no clear winners here yet but there’s already gossip that favourites are emerging.
7. Go forward 12 months and I wonder how any people would bet on there still being 4 companies and 4 products? Given what’s happening now not many. The other question is will IRIS still go ahead with the deals that she had rumoured/made no secret of to have lined up with other vendors?

Why stop at 4? The Iris PMS for accountancy firms has the largest customer base and could well be the strategic platform for the future of the group….

Go forward a year and I bet there will still be 3 software products. LFM Partnership Suite may not survive but the others cannot possibly be pushed out in that timeframe; it takes too long to convert exisiting customers and with each supplier claiming the same sort of numbers that would be 20+ conversions a week. Most software houses would struggle to do one or two a week. IRIS can't possibly bring a product to market in that time either so conversions would be to one of the existing – AIM would be my guess, if it happens at all.

The clue is in the press release.
“the new business will take the best practices from both IRIS and CS Group to create the highest-quality product sets”
How about Videss for financials, AIM for case management, Mountain for the GUI?

Oh dear – what a mess!. In my view if Iris cannot put forward what the new benefits are of having an AIM.. Videss etc… system as apposed to what they were before the merger, and I am not talking about using smoke and mirrors here – then they should now be taken to the cleaners by the marketing departments of the independents.

Mountain for the GUI? Who you kidding?!!! Mountain is a dinosaur.

I think everyone knows that LPS doesn't have a leg to stand!
As soon as it is viable it will be cut from the product line with all sales and support staff either being retrained or made redundant.

And it is not even as if IRIS have a strong history of acquiring multiple companies in one go.
Makes one think the whole thing has turned in to vin ordinaire

I find it interesting that in May IRIS was valued at between £250 and £300 million and after the merger it is worth £500 million. Did CS Group really add £200 million?
http://www.itweek.co.uk/accountancyage/news/2189690/iris-goes-sale
Will the major software houses rumoured to be interested in IRIS in May, Microsoft, Sage and Infor, still be interested? They can all afford the £500 valuation.
It will be interesting to see if IRIS goes down the same path as TFB did after they bought CB Systems and Avenue. Each of the three companies had there own legacy and Windows based systems. TFB decided to focus on one Windows based product, Partner for Windows, and end of life the other products and gave the user base three years to move over. This gave the development and sales teams a single system to focus on but meant that lots of users re-evaluated their system requirements and moved to a different supplier.

Are you sure you didn't mean to ask: who is the IT Department at LFM?

Just wanted to add a few observations from a ‘consulting’ perspective as all of this makes interesting reading.
Firstly, whether or not TFB got it right in terms of the ‘end of life’ I guess a) as a client you knew where you stood b) as an advisor likewise so choices could be made either for or against them.
What I find difficult with all of this is it’s simply difficult to believe in any of the approaches now being taken. For those of you who turned up for any CSG briefings you will know that they were quite focused on the big picture i.e. CSG as an AIM listed company and how great that made them. There was little or no substance to a cohesive legal strategy apart from we’ll keep buying and therefore be the biggest.
There are a great many well respected individuals within the CSG legal division but there problem appears to be a lack of leadership and direction. Law firms see uncertainty, that equates to risk which leads to a gradual breakdown in key relationships. Ultimately each legal company, whether it appeals or not, historically has had its own culture and style of doing business. The worry for IRIS must be that their legal group are gradually losing theirs.
I seem to remember one key line in the CSG presentations was ‘Adding value to the legal market’ which no doubt will ring a bell with a few of you out there. Should it now read ‘Adding value to Private Equity’…? However, before anyone says it it's probably good news for the consulting industry as much as their competitors.

IRIS state that the combined group will have pro forma revenues of £100 million.
If it is now “worth” £500 million could comeone please tell me how you sell a business for 5 times it's gross revenue. I am sure there would be a queue forming very quickly.

Well we have an answer. Here is a quote from the latest CSG missive from Arlene Adams.
“The new combined group, encompassing the legal software brands of AIM Evolution, Laserform, Videss Legal Office, Mountain Software, GB Systems & Meridian Law provides you, our customers with an extensive breadth and depth of choice that no others can match. Furthermore, we are fully committed to all our existing legal product lines and have no plans to end of life any products in the IRIS legal software range.”
So there we have it. This must mean they will continue to develop all of their system to take into account LSC and SAR changes etc etc.
I wonder which of the products will be the favourite or will they remain in equal competition with each other?

Well here it is the official position from IRIS to users:
The new combined group, encompassing the legal software brands of AIM Evolution, Laserform, Videss Legal Office, Mountain Software, GB Systems & Meridian Law provides you, our customers with an extensive breadth and depth of choice that no others can match. Furthermore, we are fully committed to all our existing legal product lines and have no plans to end of life any products in the IRIS legal software range.
What to make of it? At first glance it looks like a bit of a knee jerk reaction to the criticism from users and the market generally that no real statements had been forthcoming from CSG over the last year or so.
It would appear they have no plans to 'end of life' – for this month, this year, 5 years?? Not very definitive and one which could be easily changed with new management, strategy etc. Of course it's a bit of a first for IRIS in that they have products competing in the same space so with hindsight a woolly statement may come back to haunt them.
Reading between the lines this must mean that they are all competing within the same group still and therefore leaders will emerge, resources will not be shared equally and whilst some products may not have an end of life statement issued they will quietly fall behind.
Another part of the statement reads:
We not only lead the way in R&D but also in service and support. No other company in the market can claim to have over 300 people dedicated to the legal software market.
Shouldn't this mean 300 people split between 8 competing product lines at the last count with all the politics etc associated.
If you read up on their new owners you will see that they will expect an exit in 3-5 years max at a handsome profit. Given what was paid they'll have to go some to achieve this. Generally everyone realises IRIS will be up for sale in a relatively short period all over again either because it can't afford the massive level of debt or because its owner requires the exit that it will have made clear to management over the last few months – that's little comfort for users looking at their future IT strategy.

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