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Access Group acquires Fathom reporting app

The fast-growing Asia-Pacific wing of the UK’s Access Group continued its software shopping spree today with a deal to acquire forecasting, reporting and analysis app Fathom.

24th Aug 2022

4 comments

John Stokdyk

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AccountingWEB

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Fathom is the 11th financial software developer to be acquired by The Access Group in the Asia-Pacific region in the last three years.

The terms of the deal were not disclosed, but as an add-on to leading SME accounting platforms Xero, QuickBooks and MYOB, Fathom appears to be slightly off-beam from the parent software group, a mainstay in the UK’s accounting mid-market.

AccountingWEB’s head of insight Julian Green has been predicting and tracking a tough year for reporting and forecasting developers like Fathom, as users have shown a marked preference for accessing these functions from within their main accounting platforms.

“Our latest deep dive into this category reveals a confusing demand structure where users are divided between wanting an easy-to-use tool that staff or clients can use to get better control; or a tool that enables the user to get better visibility and provides access to funding, or both in one solution,” commented Green.

“This demand complexity makes it difficult for the specialist solutions to differentiate and add sufficient value over and above Excel or the built-in apps to build significant market share. Our latest research has Adaptive Insights, Castaway, Fathom, Float, Fluidly, Futrli and Spotlight having a collective share of 17% of this category.”

Market squeeze

Perhaps as a consequence of this market squeeze, the specialist forecasting, planning and reporting (FP&A) segment has seen a series of acquisitions in the past year, starting with OakNorth’s move for Fluidly in December 2021, then Futrli’s sale to Sage and now the Access-Fathom tie-up.

Fathom established itself as the most successful among the new generation of cloud FP&A apps, with 7,500 customers worldwide and the highest number of ratings on the app marketplaces. This customer population is more strongly represented in Asia Pacific and North America than in the UK.

Yet the Access product portfolio already includes financial reporting and planning tools. Not to mention mature stock management tools that were supplemented by another recent acquisition, the Unleashed inventory app used in tandem with SME cloud platforms.

The Reckon factor

The deal was clearly driven by the Access Group's Asia Pacific region. The announcement for the Fathom acquisition came overnight from regional president Kerry Agiasotis, who explained how it fits into the group’s strategy to acquire a portfolio for growth in his territory.

“The recent acquisition of the Reckon Accountants Group and now Fathom, is by design – to continue to build on our commitment to small and medium businesses and accounting firms in Australia and New Zealand,” said Agiasotis.

“Fathom’s ability to help advance organisations through digital insights, coupled with our cloud technologies and the Access Workspace platform, creates even more possibilities for our joint customers.”

Adding in the Fathom customer base, Access has gone from no presence in the region in 2019 to around 40,000 customers now. Unlike the parent group, Reckon offers both desktop and cloud small business accounting tools, along with a suite of compliance and practice management applications including APS and Reckon Elite. Oh, and if you didn’t notice at the time, Access also took over Sage’s Australian and Asian wings in 2021. This acquisition spree has been facilitated by investment from Hg Capital, the private equity house that is becoming increasingly ubiquitous in accounting circles.

A June injection of new funds from Hg took Access’s valuation up towards £10bn, and prompted the claim that it was now “one of the largest UK-headquartered software providers”.

No doubt Sage would bridle at that suggestion, but the Newcastle-based software giant would struggle to match Access’s growth rate, as Hg highlighted: “Since 2020, Access has more than doubled in size driven by double-digit organic growth, combined with strategic M&A in the UK, Ireland and Asia Pacific.”

The ramifications of this deal will continue to reverberate through the global marketplace. In Australia, commentator Matt Paff offered to open a book on who Access Group was going to acquire next, adding mischievously: “Not sure what happened between Fathom and Intuit, but the engagement that was [QuickBooks] Advanced is obviously well and truly over!”

AccountingWEB will continue to seek out informed comment and analysis on the implications for Fathom and Access customers and prospects in the UK. In the meantime, what’s your view on The Access Group’s great adventure?

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John Stokdyk

Editor at large

AccountingWEB

John Stokdyk sadly passed away in June 2023. He had been with the site since 1999, rising from news editor to editor in chief, global editor and head of insight. As a roving editor, he investigated the profession's use of technology around the world. He devoted his spare time to technology history and an oddball collection of stringed...

Replies (4)

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By tom123

24th Aug 2022 19:57

I use two Access products in the education sector. They are OK, but not without faults.

I hope they are not spreading themselves too thinly.

Thanks (1)

Replying to tom123:

By Hugo Fair

24th Aug 2022 23:05

Well they're no longer the original software company ... "Since 2011, Access has been mostly owned by Private Equity companies, first Lyceum Capital and from 2014 TA Associates."

On the plus side that means they have easier access (pun intended) to funds than some, but conversely they'll be planning their exit route as we speak ... so?

Thanks (1)

By John Stokdyk

25th Aug 2022 09:34

Thanks for the on-the-ground perspective, tom123. I was in a rush to get the article published and focused on all the background market shifts and financial analysis.

What really interests me, however, are some of the practical implications for customers, for example
- What does the deal mean for UK customers and prospects of Fathom?
- What indications are there that Access will find a market for this functionality among its UK business customer base?
- Will Fathom be integrated as Kerry Agiasotis suggests into the Access ecosystem, and how long will that take?
- Fathom doesn't currently integrate with Reckon. Will that situation change, and when?
- Does the absorption of all the specialist analysis and reporting apps into the big platforms indicate that the whole advisory accountant marketing pitch has hit the buffers? Or will Reckon/Access and the other players be focused enough to build that market?

Update: I talked to Fathom co-founder David Watson yesterday and got some answers to those questions. I'll post his story early next week, so if you've got any perspectives on this, do add your thoughts to the debate.

Thanks (1)

By John Toon

02nd Sep 2022 15:57

This is a great opportunity for Access, as with many ERP systems, they have multiple features which are all generally average. To bring in a "proper" reporting suite is an interesting move.

So far, Access with their previous acquisitions, have seemingly invested in, and meddled little, with the apps they've picked up which is a positive for their users, most of whom would otherwise never have been an Access Group customer.

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