OPINION: Digital River is the largest player in its core market with a broad, albeit somewhat dated, service offering. The company’s overall revenues of $400 million are growing modestly at under 5% p.a. (MGI estimates). The revenue trajectory for the Platform business of $330 million is flat to down as it has been steadily losing market share to more agile competitors. The firm provides an all-in-one commerce platform including order management on a rev-share basis. Revenues are highly concentrated with a few key customers, e.g., Microsoft (25%). The lack of modularity, an outdated architecture, and perceptions of high prices are all challenges that the management team needs to address. The company has attempted a restructuring, but sales of assets have not generated the resources necessary for a true redirect.
USE CASE: Mid to large businesses looking for fulfillment of a physical and digital product mix on a global scale.
COMPETITORS: Avangate, cleverbridge, FastSpring, PayPro Global, and best of breed Agile Monetization tool suppliers