Up-and-coming Australian tech companies
Australian companies aren't the only ones doing the innovating. Across the Tasman, content management system (CMS) vendor Straker Interactive has been riding from strength to strength on a stellar growth curve that's taken it from humble beginnings in founder Grant Straker's bedroom in 1999, to becoming an 18-employee operation with over 100 clients in five countries.
Straker's business is built around Shado, a CMS that was designed as a lower-price yet flexible alternative to high-end CMSes that have become critical for any company that's establishing a serious Web presence. Shado is built around Macromedia's ColdFusion Web development technology and includes a highly extensible framework that lets customers tailor it to their own requirements.
The key to the company's success, according to Straker, has been the company's willingness to take a technological risk to stand out in a field that's become choked with competitors. In Straker's case, this meant rushing to embrace Macromedia ColdFusion MX, a new Java-enabled version of the application environment released during the economic uncertainty of 2002.
Straker realised the new platform offered advantages for Shado, and began a no holds-barred effort to gain competitive advantage by embracing ColdFusion MX while competitors were battening down the hatches to weather the IT downturn. As a result, Straker became the first ISV in the world to release a product based on the new system--Shado MX--giving it valuable bragging points in a market where potential customers are bludgeoned with competing claims from all sorts of vendors offering many different technological solutions.
"There is a lot going on in the content management market and a lot of non-dead companies without viable business models," says Straker, who now serves as the company's chief technology officer. "The VC has started to dry up, and there have been mergers and acquisitions as the big boys try to come into the space. But many companies have chosen badly, and lack the ability to extend their CMS easily, so the solutions don't actually work in a business sense. We saw strength in the [MX] framework, and saw it as a way to get into large installations and implementations."
Reshaping its CMS around business imperatives paid off: the reworked Shado was good enough to net the company a slew of regional clients including Fisher & Paykel, Tourism New Zealand, and Tourism Queensland.
But Straker knew the key to realising the company's potential was to look overseas--and over the past 18 months, international expansion has been the key focus for the still young company. It hired a London-based salesperson and established a network of partners to spruik its software to clients in countries including the UK, Australia, UK, Germany, and France (home to the company's largest customer, defence manufacturer Thales, which is using Shado MX in five separate divisions).
Straker believes the company's technological independence--one of the most appealing things about ColdFusion MX was its use of Java rather than .NET technologies--has been key to allowing the company to speak to enterprise customers on their own technological terms. These days, 40 percent of Straker's global sales are running on Linux or Sun Microsystems servers--sales that would have been impossible had the company followed many of its peers in selling their souls to .NET.
Technological excellence is only one part of the puzzle, however: for a small company with limited resources, finding the right partners has been crucial for Straker Interactive's growth. The company has more than a dozen partners, five of which have come onboard since Straker's technological renaissance in 2002. Those partners bring both local experience and contacts, and a deep appreciation for Shado's architecture that's helped them go to into potential accounts with enthusiasm. That approach has allowed Straker to focus on keeping its local operations ship-shape whilst enjoying the benefits of expansion.
| “There is a lot going on in the content management market and a lot of non-dead companies without viable business models.” Grant Straker, Straker Interactive |
It's been less than four years since Shado was still a glimmer in Straker's eye. The company's strong and rapid success overseas won it recognition as the Small Business of the Year in the 2003 Westpac Hi Tech Awards, topping off a period of expansion that Straker is confident will continue through 2004.
Capitalise on others' mistakes: Data Warehousing Services
Data Warehousing Services (DWS) has been around for a decade, but in a much different form than the company that's emerged from a complete business overhaul that began in 2000.
Before then, DWS was known as Dell Price Computing Services and consisted of just three people who had worked on ad hoc data structuring projects for much of the 1990s. Many were industrial customers operating obscure equipment, from which DWS became adept at extracting data from strange data sources for storage within a large database. This expertise led to the big prize: a deal with Telstra to manage a database that collects the millions of call data records generated daily by the telco's switching systems.
As data warehousing caught on as a buzzword in the late 1990s, it became clear that clients were demanding better expertise from suppliers, who often talked the talk but failed to walk the walk as big-budget data warehousing projects crashed and burned. Sensing an opportunity to put its experience to work, DWS adopted its current name and set about on a dizzying expansion strategy that's sent revenues skyrocketing over the past few years.
Since 2000, the company has grown more than 1500 percent, increasing its staff base from three to 22 employees and establishing three separate offices. Revenues for this year are expected to top out at around $3.3 million, more than half again as much as the $2 million reported during fiscal 2003.
"The success of our business over the last three years has been based on the failure of early projects," says Geoffrey Peach, CEO and technical director with DWS. "Many contracts were built on relational databases that mirrored production systems, built by companies that did them that way because that was how they knew how to build systems. People had lost the plot or reason behind data warehousing, and [eventually] there wasn't a lot of money for DW projects because data warehousing had almost become a dirty word."
Prospects weren't helped any by the IT slowdown of the past few years, when companies tightened their purse strings and stopped buying vendors' unfounded promises. DWS took a frugal approach, spending only cash and only hiring new people when it had enough money coming in to fund the position. All DWS staffers are full-time employees, an approach that both keeps costs manageable and, Peach says, indicates the company's commitment to its customers.
By focusing on the delivery rather than the technical aspect of the data warehouse, DWS was able to help customers build data warehouses that complemented their business processes. Eventually, the company took its skills a step further: acknowledging customer backlash over unmet promises in the past, DWS designed a product that has become standard field kit for its employees, who work at customer sites in two-person teams with enough skills to operate largely independently.
The company's Mobile Warehousing system is built around a refrigerator-sized Sun Microsystems Sun Fire V880 server decked out with enough storage to meet the needs determined during preliminary requirements specification. Software is configured and tested on the server beforehand, so when the technicians wheel it into the customer premises it's ready to go. "We can have working applications in a couple of days," says Peach. "There's an instant payback for businesses because we've done everything for them."
Although its data warehouse-in-a-box has helped many customers get into data warehousing in a measured and useful way, there are still challenges for DWS, which is eyeing expansion into New Zealand as the market continues to pick up in 2004.
Peach says getting enough good staff is a key issue for the company, whose expertise will ultimately determine its success. "2002 was a tough year, but we made 2003 a success and now believe 2004 will also be a success," he says. "We're anticipating another large growth phase."
Look to the East: O4 Corporation
Like many, Ashley Bloch hoped to cash in on the hype about mobility and wireless connectivity when he founded Freedom Technologies back in 1998. Yet while mobility once seemed like a dead-set area for quick return, the pragmatism of the last few years has forced both vendors and customers to get more realistic about their expectations from the space.
For Freedom, the change in fortunes meant several years of somewhat difficult existence as the company focused on distribution of mobile software applications such as ASLConnect and AvantGo. It was only in 2002, when wireless access became a practical reality and a struggling market forced many companies to refocus their direction, that Bloch decided the time had come to make a break from the past.
A new name-- Corporation--was the most public change as the company hunkered down to stake its claim in a meandering mobility market that had grown, albeit slower than was expected a few years ago. At the time of the company's reinvention, Bloch realised that Microsoft's Pocket PC operating system was going to dominate the enterprise market, so he focused the company's development efforts on that technology and hasn't looked back.
| “The success of our business over the last three years has been based on the failure of early projects.” Geoffrey Peach, Data Warehousing Services |
Since the release of the O4 products, the company has gone from strength to strength. Through what can only be termed a lucky series of coincidences, O4 got the chance to put its products in front of a potential customer--a Fortune 50 pharmaceutical company that chose O4 technologies to support a mobile workforce that includes more than 700 people in China alone and dozens more across Australia, New Zealand, Singapore, Malaysia, and Thailand.
That kind of big-bang win is both a major morale booster and a major challenge for a company the size of O4, which has just 10 employees and spent nearly nine months negotiating the sale that will become its first blue-chip customer. Yet O4's early years taught Bloch something about business reality, and the new products were designed with multi-lingual capabilities because international expansion was always going to be on the cards.
"The market in Australia is just very small," he says. "Australian companies face a unique challenge because they have to establish an international strategy from day one. In the US, you think about your international strategy when you hit $20 million in revenue, but in Australia you don't have that luxury. To amortise your investments in building great products, you just can't do it in Australia alone. We always intended to be selling our products internationally."
To this end, over the last two years O4 has been bulking out its network of overseas partners, signing US company Eastridge Technology as its first partner in that market and strengthening its focus on China in anticipation of bigger things to come. Australia's close ties with China could prove to be an advantage for small tech companies that are willing to take the risk to approach the market, Bloch believes.
As always, choosing the right partner is important--particularly in the mobility space, where deals are often measured in the tens of thousands of dollars rather than the multi-million dollars typical in big enterprise spaces. Partners need to work efficiently to maximise their profits from such projects, and volume is important to foster steady revenue growth.
Most importantly, partners need to understand that customers often need a lot of hand-holding to find out where mobility fits into their business. Many companies have jumped on the mobility bandwagon without realising that their employees may not even need to access data live from the field when once-a-day replication serves their needs fine. Particularly given the ongoing limitations with wireless in the field, Bloch believes success in the mobility applications market will only come as continued maturity spawns end user education.
"The WAN infrastructure has not delivered anywhere near what the promise was, so mobile applications are the solutions that are practical, used, and providing business value," he says. "The wireless promise has simply not been delivered; this whole market has matured into a business application area where the value proposition is based on customers asking 'can you reduce my costs, increase customer revenue, and increase the speed at which I respond?' It's all about talking the business language, and providing good old-fashioned value."
Subscribe now to Australian Technology & Business magazine.
Give the people what they want: Straker InteractiveAustralian companies aren't the only ones doing the innovating. Across the Tasman, content management system (CMS) vendor Straker Interactive has been riding from strength to strength on a stellar growth curve that's taken it from humble beginnings in founder Grant Straker's bedroom in 1999, to becoming an 18-employee operation with over 100 clients in five countries.
Straker's business is built around Shado, a CMS that was designed as a lower-price yet flexible alternative to high-end CMSes that have become critical for any company that's establishing a serious Web presence. Shado is built around Macromedia's ColdFusion Web development technology and includes a highly extensible framework that lets customers tailor it to their own requirements.
The key to the company's success, according to Straker, has been the company's willingness to take a technological risk to stand out in a field that's become choked with competitors. In Straker's case, this meant rushing to embrace Macromedia ColdFusion MX, a new Java-enabled version of the application environment released during the economic uncertainty of 2002.
Straker realised the new platform offered advantages for Shado, and began a no holds-barred effort to gain competitive advantage by embracing ColdFusion MX while competitors were battening down the hatches to weather the IT downturn. As a result, Straker became the first ISV in the world to release a product based on the new system--Shado MX--giving it valuable bragging points in a market where potential customers are bludgeoned with competing claims from all sorts of vendors offering many different technological solutions.
"There is a lot going on in the content management market and a lot of non-dead companies without viable business models," says Straker, who now serves as the company's chief technology officer. "The VC has started to dry up, and there have been mergers and acquisitions as the big boys try to come into the space. But many companies have chosen badly, and lack the ability to extend their CMS easily, so the solutions don't actually work in a business sense. We saw strength in the [MX] framework, and saw it as a way to get into large installations and implementations."
Reshaping its CMS around business imperatives paid off: the reworked Shado was good enough to net the company a slew of regional clients including Fisher & Paykel, Tourism New Zealand, and Tourism Queensland.
But Straker knew the key to realising the company's potential was to look overseas--and over the past 18 months, international expansion has been the key focus for the still young company. It hired a London-based salesperson and established a network of partners to spruik its software to clients in countries including the UK, Australia, UK, Germany, and France (home to the company's largest customer, defence manufacturer Thales, which is using Shado MX in five separate divisions).
Straker believes the company's technological independence--one of the most appealing things about ColdFusion MX was its use of Java rather than .NET technologies--has been key to allowing the company to speak to enterprise customers on their own technological terms. These days, 40 percent of Straker's global sales are running on Linux or Sun Microsystems servers--sales that would have been impossible had the company followed many of its peers in selling their souls to .NET.
Technological excellence is only one part of the puzzle, however: for a small company with limited resources, finding the right partners has been crucial for Straker Interactive's growth. The company has more than a dozen partners, five of which have come onboard since Straker's technological renaissance in 2002. Those partners bring both local experience and contacts, and a deep appreciation for Shado's architecture that's helped them go to into potential accounts with enthusiasm. That approach has allowed Straker to focus on keeping its local operations ship-shape whilst enjoying the benefits of expansion.
| “There is a lot going on in the content management market and a lot of non-dead companies without viable business models.” Grant Straker, Straker Interactive |
It's been less than four years since Shado was still a glimmer in Straker's eye. The company's strong and rapid success overseas won it recognition as the Small Business of the Year in the 2003 Westpac Hi Tech Awards, topping off a period of expansion that Straker is confident will continue through 2004.
Capitalise on others' mistakes: Data Warehousing Services
Data Warehousing Services (DWS) has been around for a decade, but in a much different form than the company that's emerged from a complete business overhaul that began in 2000.
Before then, DWS was known as Dell Price Computing Services and consisted of just three people who had worked on ad hoc data structuring projects for much of the 1990s. Many were industrial customers operating obscure equipment, from which DWS became adept at extracting data from strange data sources for storage within a large database. This expertise led to the big prize: a deal with Telstra to manage a database that collects the millions of call data records generated daily by the telco's switching systems.
As data warehousing caught on as a buzzword in the late 1990s, it became clear that clients were demanding better expertise from suppliers, who often talked the talk but failed to walk the walk as big-budget data warehousing projects crashed and burned. Sensing an opportunity to put its experience to work, DWS adopted its current name and set about on a dizzying expansion strategy that's sent revenues skyrocketing over the past few years.
Since 2000, the company has grown more than 1500 percent, increasing its staff base from three to 22 employees and establishing three separate offices. Revenues for this year are expected to top out at around $3.3 million, more than half again as much as the $2 million reported during fiscal 2003.
"The success of our business over the last three years has been based on the failure of early projects," says Geoffrey Peach, CEO and technical director with DWS. "Many contracts were built on relational databases that mirrored production systems, built by companies that did them that way because that was how they knew how to build systems. People had lost the plot or reason behind data warehousing, and [eventually] there wasn't a lot of money for DW projects because data warehousing had almost become a dirty word."
Prospects weren't helped any by the IT slowdown of the past few years, when companies tightened their purse strings and stopped buying vendors' unfounded promises. DWS took a frugal approach, spending only cash and only hiring new people when it had enough money coming in to fund the position. All DWS staffers are full-time employees, an approach that both keeps costs manageable and, Peach says, indicates the company's commitment to its customers.
By focusing on the delivery rather than the technical aspect of the data warehouse, DWS was able to help customers build data warehouses that complemented their business processes. Eventually, the company took its skills a step further: acknowledging customer backlash over unmet promises in the past, DWS designed a product that has become standard field kit for its employees, who work at customer sites in two-person teams with enough skills to operate largely independently.
The company's Mobile Warehousing system is built around a refrigerator-sized Sun Microsystems Sun Fire V880 server decked out with enough storage to meet the needs determined during preliminary requirements specification. Software is configured and tested on the server beforehand, so when the technicians wheel it into the customer premises it's ready to go. "We can have working applications in a couple of days," says Peach. "There's an instant payback for businesses because we've done everything for them."
Although its data warehouse-in-a-box has helped many customers get into data warehousing in a measured and useful way, there are still challenges for DWS, which is eyeing expansion into New Zealand as the market continues to pick up in 2004.
Peach says getting enough good staff is a key issue for the company, whose expertise will ultimately determine its success. "2002 was a tough year, but we made 2003 a success and now believe 2004 will also be a success," he says. "We're anticipating another large growth phase."
Look to the East: O4 Corporation
Like many, Ashley Bloch hoped to cash in on the hype about mobility and wireless connectivity when he founded Freedom Technologies back in 1998. Yet while mobility once seemed like a dead-set area for quick return, the pragmatism of the last few years has forced both vendors and customers to get more realistic about their expectations from the space.
For Freedom, the change in fortunes meant several years of somewhat difficult existence as the company focused on distribution of mobile software applications such as ASLConnect and AvantGo. It was only in 2002, when wireless access became a practical reality and a struggling market forced many companies to refocus their direction, that Bloch decided the time had come to make a break from the past.
A new name-- Corporation--was the most public change as the company hunkered down to stake its claim in a meandering mobility market that had grown, albeit slower than was expected a few years ago. At the time of the company's reinvention, Bloch realised that Microsoft's Pocket PC operating system was going to dominate the enterprise market, so he focused the company's development efforts on that technology and hasn't looked back.
| “The success of our business over the last three years has been based on the failure of early projects.” Geoffrey Peach, Data Warehousing Services |
Since the release of the O4 products, the company has gone from strength to strength. Through what can only be termed a lucky series of coincidences, O4 got the chance to put its products in front of a potential customer--a Fortune 50 pharmaceutical company that chose O4 technologies to support a mobile workforce that includes more than 700 people in China alone and dozens more across Australia, New Zealand, Singapore, Malaysia, and Thailand.
That kind of big-bang win is both a major morale booster and a major challenge for a company the size of O4, which has just 10 employees and spent nearly nine months negotiating the sale that will become its first blue-chip customer. Yet O4's early years taught Bloch something about business reality, and the new products were designed with multi-lingual capabilities because international expansion was always going to be on the cards.
"The market in Australia is just very small," he says. "Australian companies face a unique challenge because they have to establish an international strategy from day one. In the US, you think about your international strategy when you hit $20 million in revenue, but in Australia you don't have that luxury. To amortise your investments in building great products, you just can't do it in Australia alone. We always intended to be selling our products internationally."
To this end, over the last two years O4 has been bulking out its network of overseas partners, signing US company Eastridge Technology as its first partner in that market and strengthening its focus on China in anticipation of bigger things to come. Australia's close ties with China could prove to be an advantage for small tech companies that are willing to take the risk to approach the market, Bloch believes.
As always, choosing the right partner is important--particularly in the mobility space, where deals are often measured in the tens of thousands of dollars rather than the multi-million dollars typical in big enterprise spaces. Partners need to work efficiently to maximise their profits from such projects, and volume is important to foster steady revenue growth.
Most importantly, partners need to understand that customers often need a lot of hand-holding to find out where mobility fits into their business. Many companies have jumped on the mobility bandwagon without realising that their employees may not even need to access data live from the field when once-a-day replication serves their needs fine. Particularly given the ongoing limitations with wireless in the field, Bloch believes success in the mobility applications market will only come as continued maturity spawns end user education.
"The WAN infrastructure has not delivered anywhere near what the promise was, so mobile applications are the solutions that are practical, used, and providing business value," he says. "The wireless promise has simply not been delivered; this whole market has matured into a business application area where the value proposition is based on customers asking 'can you reduce my costs, increase customer revenue, and increase the speed at which I respond?' It's all about talking the business language, and providing good old-fashioned value."
Subscribe now to Australian Technology & Business magazine.