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Consulting firms shift gears with start-up stakes
October 22, 1999
The investment made in Cambridge, Mass.-based Prime Response adds to Andersen's growing list of equity stakes the firm has made in recent months.
Just last week, Andersen, a $8.3 billion management consultancy, became a minor shareholder of Softbank's E*Advisor, an online financial advising service that launched in June. In October, New York-based Andersen added ChemConnect, the Net's largest global chemical and plastic exchange, to a growing list of investments that includes electronic merchandising software maker Blue Martini and online grocer Shoplink.com.
Financial terms of today's investment were not disclosed.
The company said it plans to steadily make future investments in start-ups and other types of companies that the firm believes have "breakthrough" technology and the capability to transform the way the traditional industry operates. Andersen joins its competitors EDS, Ernst & Young, PricewaterhouseCoopers and other services and consulting firms who have been focused on shifting the bulk of their consulting work from complex back-office software installations to shorter-term, more lucrative e-commerce projects as businesses move to the Web.
"We are making an aggressive move to link with organizations in the electronic economy that will benefit both our clients and make an overall impact in the new [Internet] economy," said Andersen spokesman Eric Jackson.
Prime Response develops marketing automation software that allows companies to gauge the effectiveness of their marketing campaigns in real-time, via the Web, email or even traditional marketing channels such as direct mail, call centers and mass marketing advertising. Included in its roster of clients are airline company British Airways, online investor E*Trade, bidding site Priceline.com and wireless company AirTouch.
Andersen's Jackson said the two companies have also developed what the firm calls "Customer Insight" centers based in Minneapolis, Minn., and Sophia Antipholis, France. Jackson said Andersen professionals will be trained at the centers on Prime Response software for any future implementations.
