Past Winner Stories
T2 Systems
www.t2systems.com
For the first six years of its existence, T2 Systems, a software development company, had increased revenues more than 20 fold. The staff had expanded from two people to more than forty. Complicating the phenomenal growth had been a management team of three equal partners with very dissimilar personalities, goals, and levels of risk tolerance. These three people also happened to be located in three parts of the country. In fact, the differences between partners had at times threatened the viability of the company and restricted its capability.
To combat the problem, the three brought in a consultant to help sort out their issues and get through the hurdles they had created. He helped to define the mission and goals of the company as well as its structure. The consultant was able to act as a combination of coach, critic and counselor as they began to shape the true business and financial directions of the company. Consequently, T2's revenue grew by 80 percent and the staff doubled in 1999.
Then a new matter appeared and resurrected the old problem. The year 2000 and the negative impact of fears associated with it took an enormous toll on the software industry. Many of T2's prospective customers had drained their budgets for their information systems departments in order to ensure that all systems were Y2K compliant before the new year.
As a result of diminished budgets, sales lagged behind expectations during much of the year 2000. Due to diverging corporate visions among the three shareholders and decreasing revenue, they began to explore options that would keep the company intact and maximize profits. One suggestion was to sell the company. However, due to slow sales related to the Y2K issue, it was likely that the company would be undervalued. Original co-founder Mike Simmons approached the other partners with an offer to repurchase their stock. This recapitalization was chosen as the best alternative. Simmons secured funding and the company repurchased about 32 percent of outstanding stock from the other two shareholders.
This option was the most logical since Simmons had a strong entrepreneurial spirit and a willingness to assume risk. Realizing where his strengths were, he took steps to create a leadership team that could help T2 achieve its goals.
The business plan for 2001 calls for 20 percent revenue growth and 12 percent profit as well as a strategy for rolling out new products and services. T2 has already introduced new technology, such as handheld software on personal data assistants, i.e., the Palm and also Web interfaces for its clients’ customers allowing real time, online permit purchase and ticket payment. T2 is already making plans for the next generation of its PowerPark product, which will be a browser-based program. Finally, Simmons is gearing up to pursue venture capital funding and to position the company as the true leader in its industry. After a period where it seemed like the company might not make it, T2 Systems has emerged from the challenge as an up-and-coming software company.
To combat the problem, the three brought in a consultant to help sort out their issues and get through the hurdles they had created. He helped to define the mission and goals of the company as well as its structure. The consultant was able to act as a combination of coach, critic and counselor as they began to shape the true business and financial directions of the company. Consequently, T2's revenue grew by 80 percent and the staff doubled in 1999.
Then a new matter appeared and resurrected the old problem. The year 2000 and the negative impact of fears associated with it took an enormous toll on the software industry. Many of T2's prospective customers had drained their budgets for their information systems departments in order to ensure that all systems were Y2K compliant before the new year.
As a result of diminished budgets, sales lagged behind expectations during much of the year 2000. Due to diverging corporate visions among the three shareholders and decreasing revenue, they began to explore options that would keep the company intact and maximize profits. One suggestion was to sell the company. However, due to slow sales related to the Y2K issue, it was likely that the company would be undervalued. Original co-founder Mike Simmons approached the other partners with an offer to repurchase their stock. This recapitalization was chosen as the best alternative. Simmons secured funding and the company repurchased about 32 percent of outstanding stock from the other two shareholders.
This option was the most logical since Simmons had a strong entrepreneurial spirit and a willingness to assume risk. Realizing where his strengths were, he took steps to create a leadership team that could help T2 achieve its goals.
The business plan for 2001 calls for 20 percent revenue growth and 12 percent profit as well as a strategy for rolling out new products and services. T2 has already introduced new technology, such as handheld software on personal data assistants, i.e., the Palm and also Web interfaces for its clients’ customers allowing real time, online permit purchase and ticket payment. T2 is already making plans for the next generation of its PowerPark product, which will be a browser-based program. Finally, Simmons is gearing up to pursue venture capital funding and to position the company as the true leader in its industry. After a period where it seemed like the company might not make it, T2 Systems has emerged from the challenge as an up-and-coming software company.