Sage is a British multinational enterprise software company. Sage was founded by David Goldman, Paul Muller and Graham Wylie in 1981 in Newcastle upon Tyne, England. Its current best-selling products include the Sage Business Cloud accountancy and payroll products, its Enterprise Management product and its payment services, Sage Pay.
As of 2017 it is the UK's second largest technology company[1] and is the world's third-largest supplier of enterprise resource planning software (behind Oracle and SAP), the largest supplier to small businesses, and has 6.1 million customers worldwide.[2] Sage are one of two technology stocks listed on the FTSE 100 Index,[3] the other being Micro Focus.[4]
1981–1988: The founding of Sage
In the late 1970s, Paul Muller, an American mathematician and physicist, who had previously worked at NASA's Jet Propulsion Laboratory on the Apollo Navigation Team, moved to Newcastle upon Tyne, England and became a lecturer at Newcastle University. Muller believed that computer hardware and software was a future growth industry and approached the government to get a small business grant to write software to help businesses their record keeping. Muller employed a team of 18 developers, one of which was a student at Newcastle University named Graham Wylie who took a summer job with the firm.[5]
David Goldman, an accountant by trade, hired Muller and Wylie's firm to produce some estimating software for his printing company, Campbell Graphics. The trio then formed the company in January 1981[6] that became Sage to sell their accounting product first to printing companies, and then to a wider market through a network of resellers.[7]
The legal entity named Sage Systems Ltd was formed on 27 April 1981 when a company that Goldman had incorporated years earlier, Art for Advertising,[8] was re-established by Goldman, Muller and Wylie along with Goldman's business partner Philip Lever.[9] Lever retired in 1984 aged 50.[10] The marketing side of the business was run by Goldman while the technical areas of the business were handled by Muller.[11] Muller was a director until 1985.[12]
The name Sage Systems was decided upon by Goldman and Wylie while they were having lunch in a public house called the Rose & Crown. A poster on the wall of the pub featured a number of herbs including sage.[13] By 1983 the company had changed its name to Sagesoft Limited.
"There were several herbs in the poster and we went down the list – parsley systems, thyme systems but decided that Sage Systems had the best ring to it. Just think, the business could have been called Basil or even Rosemary!"
— Graham Wylie, Evening Chronicle (5 November 2015)
In 1984 the Company launched Sage software, a product for the Amstrad PCW word processor,[14] which used the CP/M operating system. Sage software sales escalated in that year from 30 copies a month to over 300.[14]
Paul Walker joined Sagesoft, as its the seventh employee, in the role of company accountant in 1984.[15] That same year, Thorn EMI attempted to acquire Sagesoft for £1 million but Muller persuaded Goldman not to sell the business.[11] In the 1980s the business diversified to also sell office stationary and supplies.[16]
In 1986 financial year Sagesoft released the Businesswise range of products for IBM PC compatible computers.[12] In 1987 the company launched two further product ranges, SageNet (a LAN system) and Sage PC Learning,[16] followed by a second LAN product, the award-winning MainLAN, in 1988.[17] In 1987 Sagesoft also began to open regional small business software training centres around the United Kingdom.[12] By 1987 the CONTEXT organisation's research deemed that Sage's products were leading every sector in which they were sold.[16]
Sky Software Limited who produced a modular accounting package was acquired by Sagesoft in October 1988.[16][18] The Sage Sterling range became available in September 1989 as a replacement for Sage's successful Businesswise Accounts range.[19]
Sage moved from their initial office in Hawick Industrial Estate, Newcastle upon Tyne into the NEI House building within the Regent Centre office complex in Gosforth.
1989–1999: International expansion
In 1989 Sage reorganised its growing portfolio of companies with an umbrella company named, The Sage Group plc. The parent company was first listed on the London Stock Exchange in 1989.[14] In June 1991 The Sage Group plc moved into their first dedicated headquarters building, Sage House, in Benton, Newcastle upon Tyne.[21]
In 1991 the Sky accounting product that Sage had purchased 3 years earlier was rebranded as Sage Sovereign,[22] and later in the 1990s was rebranded again as Sage Line 100.[23] In the 1990s the group was using Sage Sovereign for producing their own company's financial accounts.[24]
Ciel, the French software business, was Sage acquired in 1992; their accounting product has since become the French Sage 50 offering.[25]
By 1993 Sage Sterling was market leader having accounted for 62.5% of the integrated accounting software market.[24] In the 1990s Windows versions of Sterling and Sovereign were produced alongside the DOS versions.[26] Later in the 1990s Sterling was rebranded as Sage Line 50 alongside a cut-down version of the product ranges named Sage Instant. The Sage 50cloud product range, as it is now called, remains a good seller in the 21st century. In 1994 Paul Walker was appointed Chief Executive.
In 1998 Sage acquired Peachtree, an American provider of accountancy software, for US$145 million; their main product has since become the US flavour of Sage 50cloud.
In 1998 Sage's Professional Accountants Division was established. In 1999 Sage entered the FTSE 100 index[14] and launched a dedicated Irish division, based in Dublin as well as its e-business strategy. In that same year the UK acquisition of Tetra saw Sage enter the mid-range business software market.[27][28]
2000–2009
In 2000 Sage shares were named 'best performing share of the 90s' in the UK business press.[29] In 2001 Sage acquired Interact Commerce Inc.[30] and entered the CRM/contact management market and in 2002 Sage won 'Business of The Year' in the National Business Awards.[31]
Also, that year Sage sponsored the new Music Centre in Gateshead for £6m – now known as Sage Gateshead – the largest ever UK arts/business sponsorship.[32] The Sage Group is a patron of the venue designed by Sir Norman Foster which has since become a main sight on the River Tyne.[32]
The current Sage 200cloud product was released in April 2002 as Sage MMS (Mid-Market Software) before being renamed as Sage 200 in 2007.[33] In 2003 at age 43 Graham Wylie retired with 108.5 million shares in Sage worth £146m. He was rated Britain's 109th richest person in the 2002 Sunday Times Rich List.[7] Wylie later founded Technology Services Group who operate as a Sage business-partner.
In July 2004 the company's new global headquarters, North Park, was completed in the Great Park area of Newcastle upon Tyne at a cost of £50 million.[34] With this building Sage consolidated their Newcastle-based employees into one location from Regent Centre and their premisis on Benton Park Road, Sage 1 and Sage 2.[35] Tony Hobson joined the Sage board of directors in June 2004 and became chairman in May 2007.[36]
Spanish company Grupo SP was purchased by Sage in 2003 and their ContaPlus product is now part of the Sage 50 range in Spain.[37][38] Also in 2003 the South African company Softline was acquired by Sage; among the products acquired included their Pastel product which is now the Sage 50 product in South Africa.
In 2004 Sage acquired Accpac from Computer Associates; their Simply Accounting product is now part of the Sage 50 range in Canada and their ERP product has since become Sage 300.[39]
In 2008 Sage funded the revival of The Krypton Factor television series for ITV as a part of the Business Brain Training campaign.[40]
2010–present
On 19 April 2010, Sage announced that its CEO, Paul Walker, had indicated an interest in stepping down from his position, which he had held for 16 years.[41] The Financial Times reported that his departure would lead to speculation over Sage's mergers and acquisitions, which have been a key component to the group's growth in the past 20 years. In an interview with The Times, the CEO of Sage's UK business stated that: "Acquisitions are part of our DNA".[42]
Walker was one of the longest serving CEOs of a FTSE100 company, only exceeded by Sir Martin Sorrell at WPP and Tullow Oil's Aidan Heavey.[43] According to the Daily Mail, Walker is likely to have left Sage with as much as £21 million given his shares, bonus plan and salary.[44] Walker left the company on 1 December 2010.[45]
On 1 October 2010 Guy Berruyer became CEO of Sage Group; Berruyer had previously been CEO of Sage's Mainland Europe & Asia operations.[45]
On 15 February 2013, Sage announced that Accel-KKR intended to buy Sage Nonprofit Solutions, the division of Sage that produces software designed for non-profit organisations and governmental agencies.[46]
In August 2014, Sage announced that Guy Berruyer was to retire; Stephen Kelly, the UK government's former chief operating officer, became Group CEO in November 2014.[47] In September 2014 the company announced the acquisition of PayChoice for $157 million.[48]
In March 2017, Sage Group announced an agreement to acquire Compass, an analytics and benchmarking platform. The acquisition of the Compass’ platform and team aimed to provide Sage's customers with high quality analytics using big data.[49]
In March 2017, Sage Group also announced an agreement to acquire Fairsail, a Human Capital Management (HCM) cloud-based platform, that addresses workforce management challenges of mid-sized organizations and meets the needs of increasingly mobile and global companies.[50]
In July 2017, Sage announced that it would purchase Intacct for $850M.[51]
On 31 August 2018, Sage announced that the Board and Stephen Kelly had come to an agreement and that Kelly had stepped down as a director and CEO.[52] On 2 November 2018 Steve Hare was appointed CEO.[53] Hare had been Chief Financial Officer of Sage since 2014 and had been interim COO following the departure of the previous CEO.[52][54]
In the 2010s Sage have sponsored sports teams including Bristol City F.C.,[55] Whitley Bay F.C.,[56] and the Marussia F1 team.[57] Furthermore, Sage have sponsored a number of sporting events including the Invictus Games,[58] the Reading Half Marathon[59] and the Blaydon Race.[60]
In 2019 Sage announced their intention to move their Newcastle office once again out of their North Park headquarters building and into the Cobalt Business Park,[61] the UK's largest business park, signing a 15 year lease.[62]