company profile Patience is a virtue that few entrepreneurs would claim to have. But for Dr Richard Favero, it has been a key factor in preparing his company Soprano Design for international success.
Richard Favero (Credit: Soprano)
Soprano develops business messaging software technology for use by mobile network operators. The 16-year-old company began selling into foreign markets almost a decade ago, but Favero says recent changes in the sector have led to a significant leap in international sales in the past year.
Favero has confessed that his technology was originally ahead of the needs of the market, but he has been able to turn that to his advantage by readying Soprano for the rapid roll-out of enterprise messaging technology now occurring with mobile network operators globally.
"Having been in our market for as long as we have has meant that we can accelerate faster than anybody else," Favero says. "We have always had a good product, and the product has really started to outstrip the competition in features and the pace of feature additions."
Despite the slow start, Favero says the company has remained profitable in all but one year immediately following the dotcom crash, and today employs 50 people. The longevity of the company also benefits in competition against newer rivals.
"We've watched a lot of people come and go in the market place," he says. "We were probably just a little bit early in the market place, but it has worked to our advantage now that we have stuck to our guns for that length of time, in that we are now the credible player to deal with on a global basis."
That added credibility has also helped Soprano overcome the tyranny of distance that afflicts many Australian technology companies when selling into foreign markets.
"As an Australian headquartered business you have an extra hurdle to overcome to get the attention of the global partners that a UK-, European- or US-based business wouldn't have to overcome," Favero says. "It has little to do with your technology or your capabilities; it has got to do with distance."
A further advantage stems from a decision taken five years ago to redevelop its software to support "software-as-a-service" over the internet, rather than sold as an appliance product. This has given Soprano the ability to add new features to meet customer needs without slowing down sales.
The company also adjusted its product strategy in 2008 to shift its focus away from selling to end-user customers, such as large enterprises, instead focusing on mobile network operators. The results began to flow in 2009 when Soprano secured Hutchison 3 in the UK and the Republic of Ireland as customers for its marketing campaign tool.
Favero estimates that 43 per cent of Soprano's revenue for this financial year will come from international sales, a 40 per cent increase over the previous year.
"We are looking now to have another two mobile operators to come on before June, and then we expect there to be another three by Christmas," Favero says. "Our growth trajectories are changing dramatically as we will see about a 50 per cent revenue growth this year and another 50 per cent is forecast for the year after."
The main international focus for Soprano now is Europe and East Asia, but once the company gets its market entry strategy there bedded in, Favero says he will start looking at options in India and North and South America.
"North America has got text fever, so they are ready now," Favero says. "We have a reasonably significant footprint in Asia where we have 15 people. We are now looking at what we can do in Europe to establish a footprint.
"Our whole business is going through a big reshaping to position ourselves for this growth. We are bringing in new executives, reshaping the organisational structure of the business to deal with this geographical diversity."
That has also meant ensuring that the company is multilingual in the way that it deals with customers.
Soprano is also extending its partner-based marketing activity, and with the support of the Australian Technology Showcase, it used the Mobile World Congress event in Barcelona in February to announce that it had begun working with the world's largest SMS and MMS technology supplier Acision. Soprano is Acision's partner for enterprise messaging and is part of its core enterprise messaging strategy, as well as being a Premier Business Partner with IBM.
"We are working with the Acision sales teams to take our offer to their mobile network operator customers, which you can appreciate is a huge accelerator for us," Favero says. "We now have leads into about 14 operators that we are working on."
Favero says he expects Soprano to be the largest dedicated enterprise messaging software provider globally by the end of 2010.
Back in Australia, Soprano has had significant success in the past three years through its relationship with Telstra, where it has deployed "Telstra Integrated Messaging powered by Soprano" through the enterprise and government group, snagging a number of large customers.
Favero says Soprano has now reached the end of its current strategic cycle for its software, and the future direction of the technology. Having endured for 16 years to reach the current level of success, he is planning for a long and prosperous future.
"We are a long-term player, not just a capital raise, some hype and leave it to someone else to execute. Our team is passionate about our great software that is world's best in class."