Still skeptical about the promise and payoff of managed services? Maybe you should pay a visit to Nimsoft. The managed service platform provider says 3Q 2007 sales grew 130 percent compared to 3Q 2006. Nimsoft says it also achieved EBITDA profitability, though The VAR Guy doesn’t pay that much attention to that financial metric.
EBITDA (earnings before interest, taxes, depreciation and amortization) can sometimes be a misleading statistic. During the dot-com boom, companies such as Exodus Communications pointed to EBITDA to brag about their growing success. Heck, even Ziff Davis — the former media giant — spent recent years bragging about EBITDA while bond holders worried about Ziff’s enormous debt load. Exodus, Ziff and plenty of other companies collapsed despite their EBITDA achievements.
The VAR Guy certainly isn’t suggesting Nimsoft will suffer the same fate. In fact, things look pretty darn bright at the company. Year to date, Nimsoft has increased its revenue growth by more than 80-percent over the same period for 2006 while growing its subscription business by 93 percent. Not too shabby.