It appears Brock is betting its future on NetGain. The NetGain product (does it have a name?) is decent, but not vastly superior to many of the competitive products available in the market today. The challenges Brock will have to face on the way to success include:
- market definition (who's the target customer base?) The high-end customers (300+ seats) are being served by SEBL and VNTV, to a lesser extent by CLFY and SCOP. The mid-size customers (50-300 seats) are greater in number, but there are many more vendors in that space (e.g. Saratoga, CWC, Onyx, etc.). The smaller customers are even more numerous, but try selling high-end apps to that kind of customer with decent margins.
- value definition (what's the benefit of SFA?). As customers get more savvy SFA vendors are going to have to show what return on investment the customer can expect. Buzzwords have decreasing levels of success as a market matures. So it is great that NetGain is WebBased, activeX, java-enabled, n-tier yadda yadda yadda, but customers are going to want to see real returns in terms of revenues and margins.
- differentiation (what makes Brock different?). Even if you grant their technology is superior (I don't), is that enough to differentiate them from others? It's a very crowded marketplace with low barriers to entry at the low-end. In addition to product superiority, Brock is going to have show superior infrastructure (support, implementation assistance, customer service) as well as management. I know some on this thread have commented enthusiastically about the vim and vigor of Brock personnel, but jaded old me believes in performance, not attitude.
All in all, this is not a stock I would be buying right now. If they do well this quarter (4Q97) and if they can show some NetGain sales to real customers in 1Q98 they would warrant a closer look. Until then, I'm going to wait.
To all the Brock bulls on this thread: please read my post carefully. Notice I have not 'slammed' the company--I'm just not as enthusiastic as you all seem to be. As always, thoughtful dissent is welcome. |
