Tallan Acquires twentysix New York

Systems integrator Tallan has acquired twentysix New York, expanding the scope of Microsoft-focused services it provides to enterprise customers.

The deal is particularly noteworthy because Hartford, Conn.-based Tallan is one of only 40 solution providers that are designated as Microsoft National Systems Integrators, or NSIs. With a presence in Boston, Tampa, the Los Angeles area including Orange County, Calif., and Washington, DC, the acquisition of twentysix New York gives Tallan an entre into the lucrative New York market.

While both are Microsoft Gold Certified Partners, the deal extends Tallan's  portfolio of services to include key Microsoft .NET technologies including SQL Server development and the use of Silverlight for business critical applications, according to officials at the newly combined company.

Tallan brings more traditional Web site development and BizTalk integration capabilities, among other things, executives at the company said in an interview this week. In other areas, the two companies had similar practice areas including SharePoint integration and business intelligence projects.

"We have been looking to expand our business in a number of areas and we wanted to gain more critical mass," said Craig Branning, Tallan's CEO. "We looked at various companies and we liked the leadership team with twentysix New York."

Tallan intends to keep the twentysix New York name for now, Branning said. The combined company will employ 122 people. Tallan is broadening its bench as Microsoft is getting ready to launch its new Microsoft Partner Network, or MPN, next month. Branning said the move to extend its coverage should bolster its status within MPN but it played no role in the company's decision to expand.

"It didn’t factor in but I think it just further enables us to take advantage of that," he said. "Having the combined companies gives us essentially more consultants and more technologists at the ready to streamline into those various categories that they’ve chosen for the partner network, where previously you could kind of satisfy lots of different requirements with the same people."

The new MPN requires that engineers maintain unique certifications in a given product area such as SharePoint or Dynamics, for example. In the past, firms could double-dip, meaning now they have to either bring in more engineers or partner with other solution providers.

"We have a point of view that says we think the channel will be consolidating largely by natural client and market forces, and also with a nudge from Microsoft, we see a terrific opportunity," said Jeff Lynn, a VP of alliances at Tallan, who was brought on earlier this year to expand the business. In so doing, Tallan is looking to up its presence in the area of business applications, notably covering the Microsoft Dynamics products.

Tallan recently launched a Dynamics CRM practice organically and is in talks with potential acquisition candidates to bring in a Dynamics ERP practice. "The same current clients and prospects that we're calling on want one trusted IT partner familiar with all parts of the Microsoft offering world and we intend to be one of the leading providers for that full suite," Lynn said.

Like Tallan, twentysix New York also faced the challenges of the new MPN but it too said the pending changes were not the driving factor in its desire to merge. "We certainly started thinking about mergers before the partner network changes but those changes emboldened our desire to become bigger," said Andrew Brust, who was director of new technology at twentysix New York and is now Tallan's CTO (Brust is also a blogger and contributor to 1105 Media's Redmond and Visual Studio magazines. His most recent article Microsoft PowerPivot: Making Excel Analytics Work, was published this week).

One of the new firm's key challenges will be bringing its clients into Microsoft's stack of cloud services, notably the Windows Azure platform. Because both companies have not relied on selling infrastructure but rather business applications and consulting services, Tallan believes it should be able to migrate its clients over time without disruption to its revenue and margin streams.

Branning said Tallan has already assigned several of its architects to become experts in the Windows Azure platform and to determine best practices for deploying customers' apps to that platform.

"It should be just another deployment option, really," Brust said. "As that happens, I see us taking advantage of it more and more."

About the Author

Jeffrey Schwartz is editor of Redmond magazine and also covers cloud computing for Virtualization Review's Cloud Report. In addition, he writes the Channeling the Cloud column for Redmond Channel Partner. Follow him on Twitter @JeffreySchwartz.