Accela accelerating its growth

Automation software company is diversifying to provide governments with wider array of products and services

Accela Inc., an automation software company whose offerings include permitting,

land management and building applications, is diversifying to provide local

governments with a wider array of products and services.

The company's new offerings include an emergency response system and

a soon-to-be released disease surveillance software, top corporate officials

said.

During the past three years, San Francisco-based Accela has been involved

in several mergers and acquisitions of similar companies, including Kiva

and Tidemark Solutions. It also has put more resources and personnel into

research and development (R&D) and support services, said Robert P.

Lee, Accela's president and chief executive officer.

Already, company officials

said they are the market leaders in what has been a fragmented sector with

little investment in developing better and more scalable products, whether

integrated into a city's system or hosted elsewhere.

"We think of the top 200 cities out there, roughly 60 percent of those

have purchased an off-the-shelf system like what we offer," said Maury Blackman,

Accela's marketing and business development vice president. "The other 40

percent have some system that we classify as a legacy system or custom written

on their own. Of those cities that have purchased an off-the-shelf system,

75 percent of those are from one of the products that are now under the

Accela umbrella."

In the company's most recent fiscal year, Lee said sales grew by 50

percent, which he characterized as "organic growth only," not merger growth.

"We're plowing every dollar of sales increased back into R&D and

support services and growing the company very quickly. We hope to grow more

than 50 percent this year," he sa

Such growth has enabled the company

to provide a new business model that would look toward integrating disparate

systems within a municipality, not just offering software for a particular

application. But growth also has helped diversify its product line.

One example is an emergency response system, currently operational in

Glendale, Calif., that building inspectors can use following a disaster.

Lee said inspectors could input information about building conditions and

cost estimates. The software would tabulate results, integrate the data

into a geographic information system and display a color-coded map of streets,

lots and buildings, he said.

"This is working off of our normal building inspection database because

the same wireless device ... that an inspector would use to do an emergency

assessment are the ones you take out there and do a regular building inspection,"

Lee said. "So therefore the systems are very nicely integrated together."

Accela also plans to unveil an early warning health alert system that

would use software to analyze data — from various health organizations,

including hospitals, clinics, doctors' offices and public health groups

— to determine whether a disease outbreak has occurred. Lee said the company's

working with a major customer on implementing the system, but declined to

identify the city.

The company is also looking toward developing interoperable standards.

"What we want to do is create a standard where systems can talk to each

other," Lee said. "What we're doing is defining a version of [Extensible

Markup Language) we call GovXML, and in addition to using it ourselves and

implementing it ourselves, we are going to offer this as a standard to the

standards body."

With Accela having more than a three-quarters market share in off-the-shelf

automation software, Lee said developing and implementing such standards

would go "a long way to that being a predominant standard in the industry."

"Right now there are no serious standards being considered. The market

is so fragmented it's very difficult to get a standard going," he said.

"Yet we all know that in any industry segment, standards play a key role

in expanding the market opportunity within a sector."

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