The acquisition of a software product for product management and mind-mapping might seem like a strange move for a company that’s become known for its graphics processing products.
But Patrick Nichols, the CEO of Corel, says it makes perfect sense.
“CorelDRAW allows you to express your creativity with unstructured information and MindManager allows you to express your creativity with structured information,” he says. “Those two are opposite ends of the same coin when you get down to the core technologies and we see some very rich overlap opportunities between the core strategies of the both of them as they continue to progress into the future.”
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Earlier this month, Corel acquired MindManager from San Francisco-based Mindjet.
“It was a great product that’s had a very loyal base with great recurring revenue streams,” Mr. Nichols says.
He says he sees an opportunity for Corel to add some of its own expertise to the product, but there’s more to it than that.
“At the same time, we also see the opportunity to bring in some of their technology and introduce it in our core products and see if there’s more value-add that we can unlock by having a better understanding of structured information,” Mr. Nichols says. “It’s not that we’ve got a strategy specifically to start targeting and focusing in on structured data and data acquisition opportunities, it’s more that we saw a great, rich opportunity of overlap.”
Product acquisitions have played an important role for Corel in recent years.
“Corel kind of switched cultures to focus in on profitability and operational excellence and we’ve been taking the strong profits and investing it in acquisitions over the course of the last few years,” Mr. Nichols says.
He says the decision around whether to build a new product or acquire one comes down to how fast the company can get a product to market.
“Over the course of the last three to five years, we’ve maintained a good healthy balance of both,” he says. “We focus on organic growth, while at the same time finding opportunities to invest.”
He says acquisitions can help accelerate Corel’s growth and the company’s expertise can help accelerate the growth opportunity for the products the company acquires.
Being privately held has been a benefit to Corel, which was taken private in 2010, says Mr. Nichols.
“We got to let go of the public company mantra where the goal was to basically meet and beat analysts’ expectations, and analysts don’t always make the best product managers, the best investment decisions for where a company like Corel needs to go,” he says. “I think Corel is a perfect example of an organization that’s been able to operate so much better outside of the public markets.”
Going forward, Mr. Nichols says the company sees a lot of opportunities with its core products such as CorelDRAW and Paint Shop Pro.
He says there will also be a new set of products coming out over the next two years, adding the company has its eyes on more acquisitions.