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Founded in Denmark three years ago, IT Factory is on a tear. When IT Factory was established in September of 1997 in Copenhagen, Denmark, the company's founders decreed that all correspondence -- whether by e-mail or
snail mail -- be written in English, not in their native Danish. "The whole infrastructure, even when we were just four people, was done in English," said Lars
Johansen, IT Factory's president and CEO. "That way, it would be easy to get people involved, from Germany, Italy, from a lot of different countries."
From day one, Johansen and the other founders knew that IT Factory, now one of the world's largest suppliers of Domino development tools, would eventually need to be based in the United States.
"Perception is reality," explained Johansen. "It's much, much easier to go into the financial environment when, like everybody else, you're U.S.-based. If you're not, you have to explain why,
and there might be a lot of good reasons. But, there's also a lot of risk in that. The States is the largest IT market in the world. It is the center for the kind of technology that we play with, so we
knew that one day we would need to be here." That day came in March when IT Factory, which also supplies collaborative e-business Web
applications, transferred its headquarters from Copenhagen to Cambridge, Mass., where it has had a presence since April of 1999 and where Lotus is also based. "Our focus is on collaborative
technology, so it really made sense to be in Cambridge," said Johansen. "Now, we are living 100 yards from Lotus." IT Factory recently undertook a major effort to create products that facilitate development in
Domino. The plan's centerpiece is the IT Factory eComponent Architecture development suite, which includes plug-and-play components that allow users to rapidly develop Notes and Domino
applications (for details, see "IT Factory Enhances Domino Development" on page 10 of the March/April issue). Domino Application Anarchy Through this move and others like it, the company has done a good job of solving "Domino
application anarchy," according to Matt Cain, vice president of Web and collaboration strategies for the Meta Group in Stamford, Conn. "Many organizations that have Domino don't have a lot of
efficiency in the application development process," explained Cain. "They have many developers spread across the globe, but they don't do a lot of code sharing, and they don't have a lot of
standards in place for application development. The process becomes complex to manage and maintain because there is no standard way of doing things. Where IT Factory comes in is they
provide both the methodology as well as the application building blocks for getting an organization and its Domino application development infrastructure all basically marching to the same tune."
In addition to its Cambridge headquarters, IT Factory, which is privately held, has offices in Denmark, England, Germany, the Netherlands, Norway, Sweden, and Australia. In March, it also
added a presence in Washington, D.C., by acquiring Solutions By Design (SBD), an information-technology services company and one of the country's largest independent Lotus
business partners. Terms of the deal were not disclosed. "We knew that we wanted to extend our professional services capabilities," said Johansen of the
acquisition. "We're not going out and engaging with customers who are not interested in the IT Factory technology, but we still needed a service arm that could enable our technology together with partners faster."
The acquisition was a smart one, according to Meta Group's Cain. "Building up more of a professional services arm makes a lot of sense," he said, "because a lot of companies would like to
be helped in terms of doing application development as well as implementing an IT Factory methodology." IT Factory plans to make more acquisitions in the coming months, said Johansen. "We are looking
at a series of candidates, and we are moving to other parts of the U.S. We will keep our headquarters in Massachusetts, but we're aiming to have something in Silicon Valley and a number of other locations as well."
IT Factory's first acquisition in the United States came in January when it acquired Corporate Image Software, a small company, based in Cambridge, that specialized in XML and credit card
transaction technology. Using Corporate Image's software, IT Factory introduced a Web storefront in March for Notes and Domino application components (
Despite some concerns about the size of the market for
Notes and Domino products, analysts are generally positive about IT Factory. "Gartner Group has been impressed with the way IT Factory has defined and executed its strategy," said Tom Austin, vice president
and research fellow with the Gartner Group in Stamford, Conn. "They have a good shot at driving significant consolidation and growth in the Domino-related tools and components business area."
IT Factory's is concentrating on developing and marketing B2B Web applications, Johansen said, and that is where its future efforts will be, both for Notes and non-Notes applications. "We have the software
development for Domino and collaborative technology development. The market will see us supply it with Web applications focused on the B2B space, leveraging on the already existing implementation of Notes and the 56
million Notes users out there, and we expect to move into the non-Notes market too." Currently, IT Factory distributes and services its products through a global network of approximately 250
business partners as well as its Web storefront. In the coming months, Johansen expects that the number of partners will grow to 600 or 700. "We have a very strong
belief in partners," said Johansen, who also expects the number of IT Factory employees to rise rapidly. "I can easily see the company having 500 employees by the end of the year." With the SBD acquisition, IT Factory
gained 100 employees to the 110 it already had. While Johansen would not say that he will take the company public anytime soon, he did say that IT Factory is "out there looking for ways to finance" its
activities and expanded operations. This year's revenues are expected to be somewhere between $30 to $50 million, according to company spokesman Gordon Darling, who declined to release
1999's sales figures. Johansen contributes much of the company's rapid growth rate to the rise of e-business. "We are not magicians," he said. "Our success is because of the Internet. It's because
of the environment that we live in, which is extremely exciting. Because of it, you can become global in only two and a half years." |
