Business service management (BSM) software solutions developer Digital Fuel Technologies Inc. has announced a slew of contracts with current and new customers worth an aggregate $18 million. The contracts are with Britain's BT Group plc (LSE; NYSE: BT), Sprint Nextel Corp. (NYSE: S) of the US, and Telos Corporation (Pink Sheets: TLSRP) of Canada. These are important contracts for Digital Fuel, which posted an estimated $40 million revenue in 2007.
Digital Fuel doubled its revenue in 2007 for the second consecutive year. Digitial Fuel founder, president and CEO Yisrael Dancziger predicted that 2008 would also be a good year for the company, which was growing rapidly.
Digital Fuels BSM solutions are designed for outsourcing projects. The products help companies and service providers automatically locate and monitor specified quality benchmarks, timetables, and execution costs and services for complex outsourced projects. The company has raised $35 million from Israel Seed Partners, Benchmark Capital, Apax Partners, and Sigma Capital.
The dream of every start-up is to create a more loyal customer base that generates repeat revenue from contracts that begin with limited installments and which are subsequently expanded. In Digital Fuel's case, BT chose the company to become its de facto standard across the company's offices worldwide and vis-a-vis all server vendors.
Digital Fuel's other customers include Arqiva, Capgenimi, IBM Corp. (NYSE: IBM), Siemens AG (NYSE: SI; XETRA: SIE), Telefonica SA (NYSE; IBEX:TEF; LSE:TDE) and its UK subsidiary O2.
Dancziger said that the global economic slowdown did not threaten the company. "In times of crisis, large companies tend to outsource projects in order to focus on their core business and to cut costs," he said.
"Globes": These contracts were all with telecommunications providers. What about other industries?
Dancziger: "Just as we're doing with telecom, we're expanding our business with IT service providers. We'll soon be able to announce several large contracts in that industry."
You're growth is impressive. Will you soon reach a point at which it will be harder for you to continue growing at your present rate?
"I can't avoid it. It's true that each year and level of growth brings new challenges. We hope to break through the glass ceiling and achieve the same growth rate at these levels."
Does that mean that you'll need more money?
"We haven’t raised money from external sources since 2005, but the doubling of the company's revenue costs money. We don’t need capital at the moment, but we may have to raise capital in the future to continue our growth."
Published by Globes [online], Israel business news - www.globes-online.com - on January 31, 2008
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