Danish CMS vendor Composite has reported a loss of almost EUR 1 million in their latest annual report, down from a tiny profit of EUR 4,000 last year. Revenue increased 5 % from a year earlier to EUR 1,8 million.
Composite cites high development costs, structural changes and a new office in the Netherlands as the main reasons for the loss. According to the annual report, Composite broke a few accounting laws and has accumulated quite some debt during the year, including EUR 450,000 to banks. Unfortunately, Composite was also hit by fraud by a former employee and stock holder. Composite is a small vendor with 22 employees.
Another interesting development is their relaunched website, which is now in English-only. Even though Composite does not break down revenue by countries, I suspect that a significant majority of their revenue is still from Denmark. This is much like another local and better known vendor, Sitecore, which also has abandoned the Danish language, although to be fair Sitecore are more international both in terms of ambitions and presence. Interestingly, Composite’s rebranded website has 5 news stories from April, but no mention of the recent earnings.
In Denmark, Composite competes mainly with Dynamicweb for customers with small to medium sites. In comparison, Dynamicweb barely broke even in their latest annual report based on EUR 8 million in revenue, substantially more than Composite.
If you are considering buying software from Composite, talking to other customers is naturally a good idea. Based on the annual report, I also strongly recommend that you request additional details on their financial health. It does seem like the company is in a crisis and this might help you get a better deal, but you might also want to consider your options carefully.
Will Composite be able to recover from the crisis? As always, it is you the customer that ultimately decides.
UPDATE May 1st 2009: The initial posting could be interpreted as saying that “fraud by a former employee and stock holder” was one of the contributing factors to the loss. To clarify: The annual report does not state that the fraud is related to the loss.
Michael Seifert May 1st, 2009 13:44
Thank you for mentioning Sitecore in your blog post about the unfortunate fate of Composite. We’re always pleased to be mentioned. When stating that Sitecore “has abandoned the Danish language”, however, that is not accurate, and I would therefore like to point out some “funny peculiar” facts about the history of Sitecore. From Sitecore’s start in 2002 until 2008 we just had an English-only website. Since 2009 we now finally cater for the Danish market as well as other local markets. To name a few: our offices in Denmark, The Netherlands, Sweden boast small, regional, websites in local language to support the efforts of our offices and partners. You can enjoy the Sitecore Denmark site at http://www.sitecore.net/en/dk.aspx?nav=t
We do not scorn our Danish heritage – in fact we’re proud of it. Our market share in Denmark is growing constantly. Sitecore’s strategy, which allegedly has made us into the fastest-growing WCMS provider in the world (if you know of any vendor that has more than 100% growth rates, we’d love to hear who it is), is to address a global market aided by strong local partner channels. This has always been our ambition and explains why the history of Sitecore is so peculiar that we had English only until 2008 and just got our Danish site up and running in 2009.
As always, if you have questions or if you’re unclear about any information you wish to publish, please don’t hesitate to contact us.
Janus Boye May 1st, 2009 13:44
Thank you for the link and great to see that you are using your own product in multiple languages.
BTW: Nice URL
Kim Elsass May 1st, 2009 13:44
Speaking of multiple languages, we actually have a nice Gilbane whitepaper on “Multilingual Communications as a Business Imperative”. You can get it here http://www.sitecore.net/Products/Resources/whitepapers/Gilbane-Multilingual_Strategy.aspx