Bentley Systems' New Opportunity
Bentley Systems' New Opportunity
The leader in Infrastructure CAD
Introduction, the CAD space & Bentley Systems
The computer-aided-design (CAD) software space consists of a series of highly consolidated industries where a small number of software vendors dominate their verticals. For example, Autodesk is extremely strong in architecture and construction, Dassault Systemes is used to design industrial-type products such as cars and planes, Aveva and Hexagon are the specialists in the petrochemical supply chain, and Bentley Systems dominates large horizontal infrastructure projects such as utilities, roads, bridges, grids and train networks.
Below is a former manager at Bentley describing the CAD space. This industry expert was made available via Tegus and for institutional readers, you can book a further call with him via the platform.
“If you look at projects today, they use a best-of-breed type solution, where you might use Autodesk tools to do one thing, Hexagon tools for something else, and then Bentley tools for another task. Autodesk is dominant in the vertical building market. If you look at what we call heavy civils i.e. roads, rails and bridges, Bentley is dominant in that market. If you look at the plant or process market, that’s split into two. So if you are doing onshore development, most likely it's going to be an Intergraph (Hexagon) and if you're doing offshore, it's probably more AVEVA-based (owned by Schneider Electric). Bentley is there as well, but in a third place. Lastly, for geospatial type of applications such as pipelines and transmission distribution lines, ESRI has owned that space for the longest time.”
This is Bentley’s CEO Greg Bentley giving some background on the company and their key competitor:
“The company history started with five Bentley brothers, the other four are proper engineers. And we began 40 years ago focusing especially on software for civil engineering and the modeling of horizontal networks of infrastructure. We went on to acquire the simulation engines that are used with the modeling of such infrastructure engineering, and then moved into ProjectWise, our collaboration environment. Our principal competitor is Autodesk, which is concentrated in vertical infrastructure buildings, such as commercial and facilities, but that's only 5% of our business. The rest of infrastructure is horizontal, i.e. networks of roads, rail, grid and water, and we are most comprehensive in what we do.”
For premium subscribers, we’ll dive into:
The Bentley Systems company and its outlook.
A large opportunity for the company that is currently emerging, it is not AI, although this can provide a tailwind as well with further software automation.
Bentley’s competitive advantage.
And a detailed analysis of the company’s financials and valuation, with thoughts on whether it makes sense to invest here in this compounder.