In the last week or so, ITI TranscenData announced that it had acquired Proficiency, one of the early entries into the “art” of translating feature based models between CAD systems. I was particularly interested in this announcement because I recalled that Proficiency was the beneficiary of a large venture capital investment. I recalled at least one paper claiming that the CAD migration market was in the billions of dollars. Longview Advisor President David Prawel said, “[their] study showed the CAD migration market of software and services is about $5.7 billion this year [2008].”

To explore what had transpired, earlier today I spoke with Don Hemmelgarn, ITI TranscenData’s president.

Apparently, Proficiency, with a capital investment in excess of $40 million was unable to gain enough market share or revenue to satisfy its investors, who refused to invest more in the company. Hemmelgarn expects Proficiency to add about 20% of ITI TranscenData’s expected revenue of $15 million in the next fiscal year, or about $3 million in revenue, a mere pittance in a $5 billion plus market.

Hemmelgarn is excited about bringing the Proficiency technology into his company, thus adding feature based translation and a 450 man-year investment to their technology. ITI TranscenData specializes in working with large OEM’s with a continuing need for data exchange between unlike systems, counting among their clients the major automotive and aerospace companies. Most important for this clientele is the ability to automate translations and to verify that the translation was successful and accurate. ITI TranscenData software seems to do just that and the company seems to be on a steady upward path in terms of revenue, with year over year growth in the last five years, better than many CAD software companies can claim.