UPDATED -- PODCAST ATTACHED BELOW
CCH announced today that they have acquired TaxWise.
Here's the press release: Download cch_acquires_taxwise.pdf
Read that again --- it's NOT the news from last month when we reported here that CCH had acquired ATX. This is NEW news!!!
When Kevin Robert, CEO of Wolters Kluwer's CCH, makes a move, he makes a MOVE --- 45 days ago CCH had almost no footprint in the small and very small firm market. With their ProSystem Fx line firmly entrenched in the Top 100 firms (minus the Big 4, most of whom are GoSystem Tax RS customers) Robert obviously sees the other end of the market as a ripe spot for growth. While arch-nemesis Thomson embraces a "we can build it internally better and cheaper" philosophy, the Wolters Kluwer folks are decidedly in the other camp. Nancy McKinstry, Robert's boss and CEO and Chairman of the Executive Board, commented to me last year that she does NOT subscribe to the "if it's a good idea then we'd have thought of it" philosophy and that they (CCH) would acquire best of breed products wherever and whenever possible. And the guilders started flowing .....
First it was the old CPA Software unit from Sage. The Pensacola group, founded by Mark Fenimore and sold to Best, er Sage, in 2003, was acquired in early 2006. A few months later it was the miserably-named, but incredibly well-designed BOCDIP product which ultimately won them a 2006 Innovation in Tax & Accounting Technology Award from The CPA Technology Advisor. Then, on August 1st they announced the ATX deal. Finally, (dare I say "finally" in a sentence about Robert? After all, when I asked him if he slept he quipped "only occasionally and I'm learning to do it fast!") today (and it's a holiday --- a point of irony certainly not missed here!) they announce the TaxWise deal. All told they've tripled their user base from under 25,000 users to well over 75,000 in about six weeks! That puts them solidly in # 2 position behind Intuit's 100,000+ ProSeries and Lacerte users. Their new base is larger than the remaining competition IN TOTAL! (Thomson at ~22,000 between UltraTax and Go System Tax RS; Drake at just over 20,000; OrrTax at ~12,000; and TaxWorks and a few other regionals each with well under 5,000 users.
I spent the day with Robert and his executive team two weeks ago (to the day) and was again impressed with their depth of knowledge regarding the practice of public accounting. I was also (again) impressed with their commitment and reported hard work and expanding and refining that knowledge. I'm sure Robert was more than a little bit uncomfortable when I asked him directly "Are you going to buy TaxWise, too?". I didn't expect an answer as I know full well he couldn't, but I did want him to know we were watching and studying the strategy.
At the conclusion of that meeting I was asked for my opinion --- I shared that I was thrilled to see CCH entering the 'real-world" of public accounting. The world of 10 or fewer people in an office --- the world where write-up, payroll, and tax bank products make up the bulk of fees. The world where SQL based servers, deployed in a Citrix farm and offering audit and review products are absolutely foreign. The world where 90% of the practices are!
Welcome to my world, Kevin Robert --- we're NOT just small versions of big firms! Keep listening, learn, and implement fast. And remember, 85% of us have revenues less than $500K so keep our prices LOW!!
gll
Here is an interview with Kevin Robert, CEO of Wolters Kluwer's CCH and Bill Anderson, CEO of TaxWise about their announcement.
MP3 File