Having got a taste for acquisition and bedding in the new business, come mid-2012 we started looking at further opportunities and identified a couple of potential companies to acquire.
With the Cadconsult merger Cadimage had seen its business expand into the Mechanical CAD Business as Andrew was the New Zealand dealer for Solid Edge. We were still carrying on the development of Cadimage Tools, so we decided to look at options to compliment these two businesses.
In the Mechanical Engineering Space, we acquired an Australia business and invested heavily to try to replicate some of the success we had with ArchiCAD. However, after trying several things and spending a not insignificant amount of money we decided we needed to divest so we managed to split the business and divest it in a couple of pieces.
The second acquisition was, thankfully, more successful.
Encina was a UK based ArchiCAD developer established by Ralph Wessel. Ralph was previously a customer of ours with Walker Co in New Zealand. Some of the first visualisation projects I did was with Ralph for the Force Entertainment Centre in Auckland, and then an Office Development in the Auckland Viaduct, which was our first animation produced at TV quality.
Ralph is an architect and developer having studied both at Auckland University. He was also one of the developers we used on the Lockwood Project.
Ralph and his family moved to the UK in 2001 and established Encina a few years later.
I had kept in contact with Ralph over the years, mostly catching up at the ArchiCAD University help in Nottingham. Encina was undertaking development projects for ArchiCAD customers (mostly via GRAPHISOFT UK) and had a couple of ArchiCAD Tools that they sold online.
I visited Ralph around September 2012 and began discussions and following concluding the purchase of Encina we established Cadimage UK in early 2013.
People have asked why we bought two businesses especially when one of the acquisitions didnâ€™t work out and needed to be divested again. In the first instance we pursued two opportunities on the basis that we might be successful with one. In our case both were successful and maybe we should have been more thorough in our due diligence and might have been able to foresee what might happen. But that is only easy to say in hindsight and when we were in the middle of the situation, I believe I would make similar decisions again.
Do I see having to divest the business within 24 months a failure? On one hand we lost a lot of money, but we attempted something, it didnâ€™t come off, so we exited quickly. And again, I learnt a lot throughout the process. Some businesses would have kept trying to make it work for another 6 months and then another. I think being decisive about stopping something that doesnâ€™t work is as important (or more) then starting something.