As Good As It Gets: The 2014 Solution Provider 500
The Great Recession ended five years ago this month. Maybe it hasn't always felt like the tough times were over. But it's a good assumption that this past year has probably been as good a year as the IT industry has had in a while. It's no longer just about survival. It's about growth. Which brings us to this year's Solution Provider 500 list, CRN's annual ranking of the largest solution providers by revenue in North America.
Many members of this year's class have not only survived, but thrived, growing their businesses by expanding into new service areas such as cloud computing and adding new technologies such as converged infrastructure and big data analytics to their portfolios.
That growth is reflected in the total revenue generated by all 500 solution providers: $326.9 billion. That's up nearly 5 percent from last year's $311.5 billion.
St. Louis-based Perficient has been growing about 20 percent a year recently with acquisitions accounting for about three-quarters of that growth and organic growth adding another 5 to 7 points. This year, the company moved up to No. 66 on the Solution Provider 500 from No. 79 in 2013.
[Related: 2014 Solution Provider 500 Index ]
But President and CEO Jeff Davis makes clear the company isn't making acquisitions just to tack on revenue growth.
"It's really about skill sets," he said, noting that Perficient makes acquisitions to bring in new capabilities. Process management consulting, for example, now accounts for 15 percent to 20 percent of the company's revenue.
Some solution providers are just fortunate—or savvy—enough to be in the right market with the right skills at the right time. Take Accuvant, which has focused solely on IT security and partners with security vendors such as Bit9 and FireEye. As more companies adopt cloud and mobile computing, the demand grows for services to secure what once remained safely within a company's firewall, said CFO and Operations Vice President David Roshak.
The Denver-based solution provider's managed security services business is growing fastest, but its advisory services in such areas as risk management and compliance are also in high demand.
This year, the company reached No. 48 on the Solution Provider 500, up from No. 60 last year.
"The growth has been pretty consistent," said Roshak, noting that Accuvant's revenue has grown about 40 percent a year over the past five years.
And kudos to immixGroup, which surged up the Solution Provider list to No. 37 this year from No. 51 despite selling into what may be the most difficult (or at least unpredictable) market—government.
"Most partners in this space have had a pretty tough year," said President and CEO Art Richer, pointing to last year's federal government shutdown, sequestration and shrinking government budgets, and political uncertainty. "I've been in this business for 33 years and I have never seen this kind of environment."
And yet the McLean, Va.-based solution provider just wrapped up a fiscal year with growth of 8 percent to 9 percent. Richer attributed much of that success to the company's expertise in cybersecurity, cloud computing, mobility and big data analytics.
As with every year, there is some churn as new companies make the list and others slip down the rankings. This year's list has 62 newcomers (see below)—a sign of stability, perhaps, given that in 2011 there were more than 200 new companies on the list. Two of those newcomers, ManTech and EarthLink, are in the top 50. And 34 companies on this year's list cracked the $1 billion sales threshold, one fewer than last year.
2014 Solution Provider 500: The Top 50
The 2014 Solution Provider 500 is CRN's annual ranking of the top integrators, service providers and IT consultants in North America, ranked by their solution-provider services revenue. Here we present the top 50.
2014 Solution Provider 500: 62 Newcomers
Among the companies named to this year's Solution Provider 500 are 62 companies that are new to the list.