DISYS founder and CEO Mahfuz Ahmed was invited to speak at this month’s ACG monthly meeting. Mr. Ahmed discussed some of his company’s history, as well as some of the factors behind its continued success.
DISYS provides IT staff augmentation as well as a portfolio of managed services for fortune 500 companies allowing their clients to be more more efficientand effective in achieving their business objectives. The company has a large talent pool of highly skilled and experienced professionals and continues to invest in providing innovative and quality solutions. More information on DISYS can be found at www.disys.com.
When discussing the company’s goals, Mr. Ahmed mentioned providing clients with the highest value possible, being a trusted partner, and having a positive corporate environment for all employees. He also mentioned wanting to reach $1 billion in revenue by 2017.
The company was founded in 1994 by Mr. Ahmed and his partner after they had just graduated from George Mason University. DISYS received a number of smaller engagements that allowed them to fine tune their offerings and achieve their first major contract in 1999 which was valued at $200,000.
The year 2000 was a milestone for the company, as it had just won a major contract with the Commonwealth of Virginia. It was supposed to be a $200 million contract spanning five years, consisting of 70 percent hardware related work, and 30 percent in services. While the company wasn’t specialized in hardware, the VA procurement was looking for a smaller Virginia-based business for the contract, and DISYS had a very solid track record.
“Once we won, we figured out we didn’t have the know-how to manage such a big contract, so we merged with a company called AV Networks, and that got the contract going.” Unfortunately, what they thought was going to be a $200 million account ended up being a $7 million account, with $2 million being in services.
The dot-com bubble had burst, and states were short on money. To make matters worse, Mr. Ahmed’s partner decided to leave the company after the merger, which was a lengthy and difficult process.
When it became clear that contract was only going to be a shell of its former self, the company launched the IT staff augmentation and consulting unit. The company was doing great, and planned to go national in 2005 after a special request by Exxon Mobile, DISYS’ biggest client.
With no prior experience with expansion, DISYS opened three new offices and promptly lost about $1.5 million. There was another situation where some clients began looking at global vendor pools, so DISYS opened three new offices, including one in Sao Paolo and in Singapore. The company lost another $5 million in the first two years.
“The long story short was that we turned all of these into positives. We took all of our challenges and we were able to make sure that we turned a corner. There are many reasons why something can’t be done, and at DYSIS we like to figure out how to get it done.”
In 2010, after the company took a loan from Wells Fargo, AV Networks wanted to focus on their value added reseller business, so both companies separated, but it was a smooth and friendly split.
Because of how well the company was doing, they were able to pay back the loan in 2012, two years ahead of time. That’s when Mr. Ahmed decided that “we should go out and raise money, even if we don’t need it, that way we can dictate the terms.” They had a lot of interest from a number of companies, but they went with Weston Presidio when they realized that they could work with their people very efficiently.
Part of what makes DISYS’ value proposition appealing to clients is that they don’t carry a lot of people on their staff. 90 percent of employees are on demand and move from project to project. It’s an irregular model, but one that has been very cost effective.
Other attractive aspects of DISYS is that it’s a global company with an unparalleled support system. The company also likes to stay ahead of the curve when it comes to innovation, with large yearly investments in new ideas and projects. In the last 12 months, DISYS added a CFO and a General Counsel. Commenting on why it took so long to appoint a CFO, Mr. Ahmed had this to say:
“Our revenue last year was about $330 million and we finally added a CFO. We were busy growing and innovating and doing other things, we didn’t want to be bogged down by people telling us we didn’t have the money to do it.” He continued “We pride ourselves in being a true global company that can help global clients achieve their goals. This year has been a great year, and also a learning year, because having a private equity as a partner does teach a few things.” The company has been experiencing a 40% growth year-over-year since 2007, and it’s on track to reach its goal of $1 billion in revenue by 2017.
To register for October’s ACG Monthly Meeting featuring David F. Melcher, CEO and President of ITT Exelis Inc, click here.