Consolidation in the ERP systems industry: What does the merger into Serpentin mean?

There is no doubt that the ERP systems industry is in the midst of a major transformation. In recent years, we have seen a clear wave of consolidation where smaller, often niche, partners become part of larger, more resourceful organisations – often with the support of external venture capital seeking to enter the industry.

This trend affects not only the competitive landscape but also the conditions for both customers and suppliers. Today's news is the merger of Sherpas, Devisum, KR System and Netropolis into the new brand Serpentin, with Valedo Partners becoming the majority owner. What is behind this development and how does it affect the market?

The fact that four established players in business systems, all with different specialisations and customer bases, have chosen to join forces is not only a sign of the times – it is a clear indication of where the industry is heading. By bringing together resources and expertise under the common brand Serpentin, the foundation is laid for a new strong player in the Swedish market.

The merger signals both a desire and a need to offer broader solutions and better coverage of both Microsoft's and other business-critical platforms. In this case, Pyramid partners are also included.

Ongoing consolidation

Consolidation is not a new phenomenon within the IT and ERP systems sphere, but the pace has accelerated markedly over the past decade. Particularly among Microsoft partners, the development has been noticeable – more than 80 percent of all Swedish Microsoft partners have in the last 10–15 years become part of larger groups or consortia.

The drivers behind this are several: increased competition from international players, rapid technological development, greater demands for innovation and demand for turnkey solutions.

Microsoft partners

The fact that up to 80 percent of Microsoft partners in Sweden have consolidated is telling. The motives behind the mergers are often pragmatic.

• Meeting customers' increasing demands for comprehensive solutions and broad expertise
• Managing an increasingly extensive technology stack, especially around Azure and Copilot
• Attracting and retaining the right expertise in a competitive market
• Taking advantage of economies of scale and increased bargaining power

Pyramid partner segment

What makes the merger into Serpentin particularly interesting is that it marks the consolidation now seriously reaching even the Pyramid partner segment. Pyramid has long been known for its extensive ecosystem of specialised, often smaller partners, but now we see that even these are beginning to unite under larger umbrellas.

This is a logical next step in the industry's development, where even the most niche expertise needs to be able to interact in larger and more cross-functional contexts.

Advantages and disadvantages for customers

For customers, consolidation means both new opportunities and certain challenges.

• Greater capacity and a broader range of services
• Better ability to keep up with rapid product development
• The opportunity to consolidate consulting, implementation, and support with one supplier

At the same time, there are some risks:

• Less personal and close customer relationships
• Reduced flexibility in favour of standardised processes
• Higher barriers to collaboration with larger organisations

What lies ahead for the industry?

Everything indicates that the consolidation trend will continue – and likely accelerate – in the coming years. New technologies such as AI and automation place increased demands on both expertise and investments, something smaller players find difficult to manage alone.

At the same time, we see customers becoming more strategic in their choice of IT partners and expecting long-term collaborations with stable actors.

We look forward with interest to following the ongoing transformation in the market.