Bethesda-based Savant Corp. said yesterday that it has struck a potentially lucrative partnership deal with Sybase Inc., one of the largest U.S. makers of software for business applications.
Under the deal, Sybase gets exclusive rights to privately held Savant's pioneering computer program that can alert information technology managers to database problems and diagnose them.
Sybase gets the right to sell the program, named Q Diagnostic Center, to its existing customers without paying Savant a royalty.
In exchange for developing and licensing the program to Sybase, 5-year-old Savant gets exclusive access for two years to Sybase's extensive customer base to sell its other software programs that help manage and monitor the performance of business databases.
"We helped them change their engine to be even more competitive, and we get a huge new customer base almost overnight," said William Wynn, Savant's co-founder and chief executive officer.
Savant, which turned profitable last year and projects revenue of $10 million to $12 million this year, expects the deal to triple its staffing to 150 by year's end, said Wynn. Six months ago, the company had 15 employees.
The former Citibank information technology executive said he expects the program to stir strong interest among Sybase customers because it is designed to help companies save time and money on the tedious and expensive task of diagnosing database problems, such as slow performance.
Industry analysts estimate that programmers spend 75 percent of their time on a project trying to determine what the problem is.
Billy Ho, Sybase's vice president for products and solution operations, said, "By integrating Q Diagnostic, Sybase is able to make information about complex data management environments easier to view and understand."
Savant, which only began generating revenue three years ago, said it expects its base of 500 customers to grow rapidly as a result of the partnership.
Sybase, which posted a net loss of $93.1 million on revenue of $867 million for 1998, does not disclose how many customers it has.
Software industry analysts estimate that the Emeryville, Calif.-based company holds a 15 percent share of the world market for software programs that operate and manage business systems. Its chief competitor is Oracle.
Savant provides another diagnostic program to Oracle's customers.
To fund the expected rapid growth as a result of the Sybase partnership, Wynn said Savant is planning to conduct a new round of private financing this year.
The company, he said, expects to raise about $15 million from corporate and private investors.
"Our goal is to build a major company that has staying power in this industry," he said.
The market for business database software is projected to explode as large companies upgrade to new programs and more mid-size and small companies start using programs to manage their business needs and databases.
Dataquest estimates that worldwide the industry will grow to a $10 billion market by 2003.
IDC, another computer industry research company, estimates the market at $2.5 billion today.
Pub Date: 3/26/99