May 15, 2006
PLM and cPDm Update
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Jack Horgan - Contributing Editor

by Jack Horgan - Contributing Editor
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In February 2005 Agile announced it has acquired Cimmetry Systems, Incorporated of Montreal, Canada for approximately $41.5 million in cash. Founded in 1988, Cimmetry Systems is a provider of collaborative visualization solutions including AutoVue, with well over 9,500 customers worldwide across several industries including manufacturing, electronics, AEC and industrial markets. Cimmetry solutions support over 450 native formats

Agile markets and sells primarily through a direct sales force. They have local sales offices in the United States and in Austria, Canada, China, Germany, Japan, Taiwan, Switzerland and the United Kingdom.

Agile claims over 10,000 customers including Arthrocare, Ball Aerospace, Bally Gaming, B/E Aerospace, Conexant, CooperVision, Digirad, Draeger Medical, Eastman Kodak, Foxlink, GN Resound, W.L. Gore, Grandstream Networks, Harman, Herbalife, Hewlett Packard, Intier, Logitech, Metaldyne, NEC Computers, NACCO, nVIDIA, Overland Storage, Phoenix, Plexus, Powerwave, Siemens, Spirent, Synthon, Synthes,
Texas Instruments and V-ZUG.

Agile offers products for:

Product Collaboration Product Governance & Compliance
Engineering Collaboration Product Data Management
Product Portfolio Management Customer Needs Management
Product Cost Management Configuration Management
Product Quality Management MRO
Table Agile Product Offerings

It will be interesting to see how Agile performs as the last remaining major independent cPDm vendor.


In 1983 MatrixOne began as Adra Systems, a mechanical CAD/CAM firm offering a workstation clone of CADAM, a popular mainframe system being sold by IBM. Adra subsequently acquired PDM technology developed internally by a large end user. When introduced by Adra to the general market, this PDM technology sported a novel user interface well ahead of then-available commercial PDM products like Sherpa and Metaphase. The first commercial version of Adra's business collaboration software shipped in November 1993.

Adra management renamed the company MatrixOne in October 1997 and in May 1998 sold off its legacy CAD business. In June 1999 MatrixOne introduced the eMatrix product line. In March 2000 the company completed a successful initial public offering with net proceeds of $132 million.

Over the last five years MatrixOne has lost a cumulative total of $89 million. The firm had a dramatic climb but stalled in 2002 and has only recently recovered.

  2001 2002 2003 2004 2005
SW License 78,294 45,289 38,006 38,747 47,300
Service 61,144 73,660 67,015 70,830 76,754
Tot Rev 139,438 118,949 105,021 109,577 124,054
YoY Delta 87.8% -14.7% -11.7% 4.3% 13.2%
NI 4,467 (33,024) (28,202) (12,406) (20,321)
Table MatrixOne 5 Year Financial Performance

Software license revenue for the last three fiscal years has averaged about 36% of total revenue while service (maintenance, professional services and training) accounted for the remaining 64%. Maintenance and professional services each accounted for accounted for about 49% of total services revenue.

In F2005 North America accounted for about 55% of total revenue, Europe 33% and AP 12%. In terms of industry segments aerospace/defense accounted for 12% of total revenue, automotive 23%, consumer products 6%, high Technology 49% and industrial 10%. The firm has 488 employees, 54 active partners and 850 customers.

The Matrix10 offering is a comprehensive and flexible PLM environment that consists of four components: the Matrix PLM Platform, Business Process Applications, Enterprise Integration offerings, and MatrixOne Accelerators. The Matrix PLM Platform serves as the foundation for the Matrix10 PLM environment and includes the MatrixOne PLM Modeling Studio. The Business Process Applications allow companies to improve the way they collaborate with internal and external teams. The Enterprise Integration offerings enable data sharing between the Matrix10 PLM environment and third-party enterprise applications and tools, including MCAD, ERP and EDA systems. The Accelerator offerings bundle
Business Process Applications with specific industry language and terminology, data models and schema, pre- defined work processes and reports, and role-based user interfaces to speed deployment and ease user adoption.

MatrixOne heavily leverages partnerships with System Integrators such as Accenture, CGEY, Bearing Point, and Fujitsu. IBM Global Services is also a partner. On October 22, 2003 MatrixOne announced an OEM agreement with Cadence, a leading EDA vendor. Under this exclusive agreement, Cadence will embed MatrixOne technology into advanced PLM solutions that will be marketed and supported directly by Cadence.

In June 2004 MatrixOne acquired Synchronicity Software, Inc. for consideration valued at approximately $18 million in stock and cash. Synchronicity is a leading provider in electronic design management, team collaboration and IP reuse solutions for the global electronics industry. At the time Synchronicity had more than 120 electronics industry customers, including 13 of the top 15 semiconductor companies. The company was private and had raised $31.5 million. In addition to venture capital investors Intel Capital, Cadence Design Systems and Synopsys were strategic investors. In its last fiscal year Synchronicity generate $12 million in revenue with a 60/40 split between software licensing
and maintenance/service. The user base was around 25,000 seats. The purchase price was 1.5 times revenue but less than the cumulative outside investment.


I previous interviewed Dennis Harmon, now CEO of Zenasis Technologies, who had been CEO of Synchronicity. The following is an excerpt from that interview.
Would you give us a more expanded view of what Synchronicity was up to?

Synchronicity was basically building a product to help design engineers communicate and share information in real time over the Internet. What we built from a product perspective was the ability for companies with large geographically dispersed design teams to effectively work together in an environment where the location of the data was transparent to the users. For example, Intel was one of our largest customers and actually an investor in the company. They used Synchronicity technology and are not created by one group in one building. You'll get cores from different companies. You'll get IP from different companies. You will have design teams dispersed throughout the world working 24
hours a day on chip design. Our technology basically underlayed the EDA environment and provided a means for EDA data to be shared in an effective and efficient manner.
Who was Synchronicity's competition?

Strangely enough there was very little competition from a commercial perspective. The real competition for Synchronicity was internally developed solutions - people putting together scripts, PERL scripts, PDS and various other forms of configuration management tools. Of course the challenge was that it kind of fell apart as soon as you introduce an external partner, for example if you wanted to work with the ARM core team inside your design team. We were probably the only commercial solution and in fact Synchronicity is still the only commercial solution focused on semiconductor design. The uniqueness of that is that we understood all of the EDA data models, i.e. Cadence data
base and Synopsys data base. We natively handled very complex data bases. There were some other small companies that did parts of what we did but not in the way we did it.
I am sure you know that the three major high end mechanical CAD vendors (Dassault Systemes with Catia, Unigraphics and PTC with Pro/E) generate significant revenue from PDM (Product Data Management) products and services. There are also MatrixOne and Agile who are focused on PDM and have revenues in excess of $100 million. How come there is no parallel in the EDA industry?

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-- Jack Horgan, Contributing Editor.


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