The relationship between system integrators and venture capitalists ought to be ongoing and fruitful, according to a report in Computer Systems News, but the two camps rarely meet. Although there is a plethora of skilled but underfunded system integrators and many a venture capitalist with monies at the ready, the latter can’t differentiate between various integrators, and the tecchies find it difficult to recruit effective long-term managers. Also, integrators are not alone in regarding venture capital as suspect, wary of the day when the sugar daddies come to collect. However the US trade quotes several venture firms that insist they are not antipathetic to system integrators, but they do look for several things before investing. The first is a coherent business strategy that consists of more than technical skill alone. Secondly, the range of skills should be broad, including an understanding of open systems, the integration of applications and network topology. Perhaps the main obstacle is the return sought by venture capitalists. Systems integration is characterised by low gross margins and low capitalisation, and few integrators have reached desired revenue levels, although mergers may provide the necessary boost.
