Low Code Gets an Industrial-Strength Boost
The rapid turnaround approach to enterprise application development known as low code continues to gain momentum with this week’s acquisition of cloud native application development specialist Mendix by the German industrial conglomerate Siemens.
Munich-based Siemens (ETR: SIE) said Wednesday (Aug. 1) is expects to close the roughly $730 million cash deal during its first fiscal quarter in early 2019.
Boston-based Mendix will become part of Siemens’ “digital factory” unit. Its low-code application development tools will be integrated with the buyer’s Mindsphere industrial Internet of Things portfolio along with its digital enterprise offerings.
The low-code application development platform “will help our customers to adopt MindSphere even faster by accelerating cloud-based application development for the Industrial Internet of Things,” said Klaus Helmrich, a member of Siemens’s management board.
The acquisition addresses growing enterprise demand for rapid development of distributed applications as developers struggle to meet that demand. The Mendix low-code platform is among a growing number designed accelerate development and deployment of cloud-native applications.
The Mendix deal gives Siemens “cloud domain expertise, cloud agnostic platform solutions and highly skilled people,” added Jan Mrosik, CEO of the company’s Digital Factory Division.
Mendix CEO and Co-Founder Derek Roos said the acquisition would allow it to accelerate R&D. The company was founded in 2005 and operates on a software-as-a-service business model. Mendix employs more than 400 software engineers.
Proponents of low-code application development point to the Mendix acquisition as another indication the approach is entering the mainstream. The industrial market“needs to develop apps faster and be able to innovate quickly to build solutions on top of their devices,” Paulo Rosado, CEO and founder of OutSystems, noted in a statement reacting to the Siemens acquisition.
Other large industrial companies like GE (NYSE: GE) are embracing low code, and “Siemens will be able [to do] the same thing for their industrial solutions,” Rosado added. “Low-code is no longer for the early adopters….”
OutSystems, a low-code pioneer headquartered in Portugal with offices in Atlanta, recently announced a $360 million funding round that included Wall Street titans Goldman Sachs (NYSE: GS) and KKR (NYSE: KKR). OutSystems has raised more than $422 million in private equity funding since its formation in 2001.
Those large investments along with low-code acquisitions prompted market watcher Forrester Consulting to forecast the low-code market will be worth more than $10 billion by the end of next year.