Austin-based Iconixx Software raises $4.7 million for expansion
Dec 28, 2012 (Austin American-Statesman - McClatchy-Tribune Information Services via COMTEX) --
Rather than giving annual raises, many businesses are moving towards performance-based salary increases, which involves the close tracking of each employee's work.
That's creating a growing market for companies like Austin-based Iconixx Software Corp., which sells software that manages sales compensation, bonus and salary management for businesses.
Iconixx, whose customers include Blue Cross Blue Shield, Nokia Corp. and Burkhart Dental, said Friday it has raised $4.7 million to pursue new customers.
The lead investor in the deal was Ballast Point Ventures of St. Petersburg, Fla.
"Incentive compensation is not just for salespeople anymore," said Derrik Deyhimi, CEO of Iconixx. "Because the economy has been so tough, companies don't just want to give everybody big base salaries and an annual 4 percent raise. They keep their base fixed and create incentives based on performance."
Iconixx was created in 2010, when the company acquired the compensation software division of Austin-based nGenera Corp. for an undisclosed amount. The deal was carried out with financial backing from KBH Ventures LLC, an Austin-based private equity firm.
The software-as-a-service market for performance management software is more than $150 billion, and the incentive compensation is one of the fastest growing market segments, according to industry research groups.
The market has caught the attention of major software players, including IBM Corp., which this year purchased Varicent Software, a Toronto-based provider of analytics software for compensation and sales, for an undisclosed price. Other competitors include Silicon Valley-based Xactly Software, which has raised more than $100 million.
Deyhimi said what sets Iconixx apart is its scope, which goes beyond salesforce compensation to manage performance goals for every employee in an organization.
"It's about aligning your whole workforce to perform with the company," Deyhimi said. "That can involve anyone from a salesperson to a manager to a bank teller. It gives everyone an incentive to meet objectives."
Iconixx's customers range from 10-employee businesses to global corporations. In the case of Nokia, the company handles incentive compensation for workers in 40 countries.
Deyhimi declined to disclose the size of its workforce, but said it is less than 100. The company, which is headquartered downtown on Congress Avenue, plans to add up to 150 workers in Austin over the next two years in positions including sales, engineering and customer support, he said.
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