GFI set to recruit and grow - March 1, 2007

Software development company GFI is planning to move into new offices early next year, having grown by leaps and bounds over the past few years.

"We are being very creative with our space in Malta but we are popping at the seams. We have a team looking at various options. We need room to grow as we do not see the expansion slowing down for a few more years," CEO and chairman Curtis Staker said.

Mr Staker joined GFI as CEO in 2005 and was appointed chairman a year ago, taking over from co-founder Nick Galea, who moved on to run two new start-ups.

The Malta office started in 1992 with just five employees. It added 25 last year, bringing the total up to 93 and needs to increase that to 105. It is planning to fill many of these vacancies at the job fair being held at the Radisson SAS Baypoint on March 10. This is GFI's second job fair, the first last year having attracted 211 hopefuls.

"It is nice to be the prime target of people seeking IT jobs. We are very proud of the people that we have been able to recruit and maintain at GFI. Nick had put together a very good team of people that we are very fortunate to have.

"All we can do is ensure that we continue to provide a challenging work environment, maintain a proper status in our pay rates and so on. We have excellent health benefits for our employees and their families and we are also adding life insurance. And we have a very good training programme. But frankly this is not just for the purpose of keeping them. This is because one of our corporate goals is to be an employer of choice. That is the way to recruit the best of the best," he said.

With a total of 240 employees worldwide, Malta is still clearly the centre of GFI.

"Malta is the heartbeat of the company and will remain so. There is no reason to change that. This is where the products are developed. When I joined the company in September 2005, one of the very pleasant discoveries was the quality of the technology, as well as the ideas and concepts for new products; the base of our marketing is in Malta," he said.

Mr Staker has a house and family in San Diego, California but spends his time travelling around GFI's three main offices in San Gwann, North Carolina and London, which is growing as a base for European operations, sales channel development and as a base for GFI's chief financial officer Christopher Gale.

"This way, if and when we list as a public company, it will be on the London Stock Exchange, for a number of reasons," he said.

An IPO had first been mooted in 2000 but never materialised. No date has yet been put forward. Mr Staker said that this was because the company was not under any pressure to list as a way to raise capital.

"We could list. We have excellent financial results, a predictable business model and good long-term prospects.

"To list, you usually need three very good, documented years of financial results and I believe that the accounting for 2005, 2006 and 2007 should give us that.

"Sales were up by over 35 per cent last year, which well outpaces the industry. We are generating cash, which gives us the luxury of being able to say that we do not need to raise money. You go public for a number of reasons and we would do it for the best of those reasons. We are highly profitable, which would make it a very attractive public offering. We could sell a third of the company to public investors for a premium. We could then use the money to acquire other companies, to expand our offices and to grow the business faster."

Acquisitions are an integral part of GFI's plans and an announcement of one was imminent at the time of the interview.

"You acquire companies for a number of reasons; sometimes these are purely strategic, which can often be an excuse for a bad acquisition! But sometimes there is logic behind it. It might get you into a different market or it might open up an alternative set of channels for your products to be sold through.

"GFI's acquisition strategy revolves mainly around technology at this point. What you do is look at whether you have gaps and at whether that gap can be filled most efficiently by internal development or by acquisition.

"Last year, for one of our fastest earning products, we thought we had a technology gap when it came to serving large customers. One of our directors in Malta came up with a couple of target companies, we found them and bought them. We are now innovating the product and will deliver it as part of the GFI solution by the third quarter of this year," he said, adding that the approach would remain prudent.

"There are many potential targets but I am very concerned that we should remain focussed as it is easy to get distracted. My team have good peripheral vision but not 360° vision!" he laughed.

Acquisitions are not the only route to expansion or to accelerate entry to a market.

GFI has some Original Equipment Manufacturer agreements close to conclusion, where its products will be sold under other companies' brands. Mr Staker said that these include "some interesting, recognisable names..."

Asia remains GFI's largest growth market, with business up over 60 per cent last year, although it still remains a small percentage in terms of overall volume compared to Europe and North America. Mr Staker's approach is very down to earth.

"I used to run a large Asian organisation and from experience, I can tell you that you have to tread carefully. You only get one chance. You cannot just dabble with those markets. Were we pleased with our China revenue in 2006? Yes. Are we going to drop everything and say it is our next big market? No.

"There are so many pipe dreams there and so many distractions. What you need is hard work to develop the channel and the market. You don't just wake up tomorrow and say 'China is our next market'," he warned.

With customers spread around the globe, technology is used on a daily basis for video conferencing and webcasts but Mr Staker is pushing for a more personal approach.

"Since I joined, our travel budget has probably increased by 500 per cent. We believe you should not do your business in your office but that you should get out and about. Our philosophy is that if you spend all of the time talking to each other when you are developing your product, it only works if you are actually selling the products to each other - and there is not a whole lot of money to be made there!

"This is just part of the cultural revolution that we have undertaken at GFI in the past 16-17 months."

With so much going on elsewhere, what about Malta itself? Mr Staker was somewhat underwhelmed by the thought of SmartCity and the opportunities it would bring GFI.

"Well, we do not yet have much information about it although it sounds good as it should bring more technologists to the island. But it is not directly relevant to us. We are already a functioning business so it is not as though we are pinning our hopes on it. But as it comes to fruition and becomes a reality, we will look into it more closely," he said.

"We already have a business plan for the next two years but beyond that you need to have flexibility and experience, you have to be mobile and to be able to move things around. We see a very bright future for GFI and I am very glad to be a part of it."