It’s the rare small tech company that stays in business more than 30 years. Most fail within a few years of startup. Others get bought, merged, or morphed some other way. A few grow to be tech giants. But Advanced Systems Concepts, Inc, (ASCI) in Morristown, NJ, has stayed its course as a small software business since 1981.
Ben Rosenberg co-founded ASCI to provide processing software to HP even before the PC came onto the scene. Over the years, ASCI pioneered the IT automation field, and has now moved into managing cloud sprawl.
Rosenberg spoke with Yahoo Small Business about the changes he has seen as he has led the company through three decades and multiple evolutions, and why he has chosen to stay small.
Yahoo Small Business Advisor: Being in the tech business in 1981 versus 2014 – what’s different?
Rosenberg: It used to be you visited your customers and took them out to lunch to establish relationships. Today, thanks to the Internet, we have customers in 49 countries. We’ve done millions of dollars worth of business with customers we’ve never seen. When they call us, we answer the phone; when they send us email we’re responsive. In their minds, we’re very reliable, even if they haven’t met us.
What’s also different is that the major players that were around in 1981 are not around any more. IBM is still here, but not Digital Equipment Corporation or Compaq.
YSBA: Why do you think you’re still here?
Rosenberg: Agility is important—to be able to recognize how the industry is growing and to move with it.
We’ve been smart in terms of where we’ve made investments. We’ve invested in our employees. We make sure that the compensation, resources, and good treatment are there. We recognized early on that when you bring people on, even when they don’t know much about software or the company, everybody wants to contribute. Our average turnover rate is 9 years.
YSBA: It’s hard to find skilled people in tech. How do you do it?
Rosenberg: We mentor with some of the local colleges here like the Stevens Institute of Technology co-op program—not always in engineering, but also in marketing and sales. We like to be able to not only give them a good work experience, but to talk to them about the industry. If their major is computer engineering or computer science, we want to show them what it’s like developing software where we’re selling it to other companies. We make sure that the college kids who come spend the summer with us or do a co-op for credit get to put a foot in the water.
When we talk about recruiting, we’re developing a proper mix. There are companies out there that bring in college kids figuring they’ll save money. Our view is that like any good team, you want a diverse mix of rookies and veterans.
YSBA: What’s been your competitive strength over the years?
Rosenberg: Our mantra has been to provide high-quality, feature-rich software at affordable prices. At the high-end, it’s easy to compete on price. We’ve been successful 33 years at making the value proposition to our customers. Sometimes we cost more or are close on price. At the really low-end, competitors’ products are not nearly what ours are.
We’ve also tried to be very responsive and accurate in technical support. We allow customers true proof of concept. And we say, “evaluate the company, not just the product.” We say, “You want to be calling our support group, not the sales guy, so that you can determine for yourself whether what we’re doing makes sense.” Customers see the value in that.
We also take the approach that customers want the solution. They don’t want software that makes them drill the holes, they want the holes.
We deliver software horizontally, regardless of market. One of our first products was a transaction processing system called Intact. It could be used in financial industries, in the healthcare industry and hospitals, and in lots of other industries. From there, we were one of the first to develop software for disk mirroring, so that if one drive dies you have copies and can continue to operate.
YSBA: Where do ideas for new products come from?
Rosenberg: We have a dozen software products and our customers using them in the trenches come up with great ideas. The products that have done well are usually the ones where we’ve listened to our customers. Sometimes customers will suggest an enhancement that enhances only their product. But a lot of times a customer will make suggestions we would never have thought of.
It’s very important not to have an ivory tower. A product idea can sound great on paper, but customers aren’t going to be able to use it.
Our oldest customer is in Sidney. They’re a major Australian bank that has been using our software for 30 years. The thing that keeps them coming back to us is that we provide great customer service. We’ve been working together so long that no lawyers ever have to be involved. We’ll give them an invoice before we do consulting work and they pay it before we get started. They know us and trust us. Time zones are not an issue.
YSBA: After all these years, you’re now in a growth mode?
Rosenberg: Right now we’re aggressively hiring. We have 75 employees, and we’re taking over another floor in our complex. I’ve always been very conservative about hiring, but now there is so much business and there are so many different opportunities for us that we’ve been attempting to hire people across the board, in engineering, sales, and marketing.
YSBA: Did you resist getting much larger earlier?
Rosenberg: We’ve had gradual growth over 30 years. I did not want to grow too large. I’ve seen other companies that didn’t manage the transition from small to medium-sized business very well. There are lots of stories out there about businesses that get flush with success only to find the bubble pops. It’s hard to go back and the company goes out of business.
YSBA: You are self-funded and still a private company?
Rosenberg: I’m most proud of that. I get calls every week or so from VCs, but we are completely self-capitalized and extremely stable. There were a lot of opportunities to grow or go public, but building software systems is something I always wanted to do and I get enjoyment out of it. A lot of people come up with a great idea, what they were trying to do becomes a product or service. I was never really interested in that. I may be a throwback in that I actually wanted to build things.
YSBA: After 33 years running a business, do you think about retiring?
Rosenberg: When I first started my average time on a job anywhere was three-and-a-half years. I thought, “If this thing lasts three years, that will be good.”
Back then, people would ask, “What happens to the business if you’re run over by a bus?” Now I get asked, “What’s your exit strategy?” Quite frankly, I’ve noticed that people who keep working in jobs they love tend to live longer than the people who say, “I’m done.” Maybe I’ll take more vacations, not work the same kind of days. I’ve made sure that all the directors of sales, marketing, and engineering are able to run their areas. If something did happen to me, the company is able to continue.