Through his experience with Monster Worldwide Inc., Lavastorm Technologies Inc. and Netkey Inc., V. Miller Newton has developed a reputation and a track record of building successful software and technology companies.
“My specialty is sales and marketing of technology companies,” he said. “I like to take commercially successful products and grow them, and there is a huge opportunity to do that with PKWare.”
PKWare’s former horizontal market approach and use of direct sales has provided the company with a roadmap for growth and expansion, Newton said
Because many of its customers purchase software and technology for industry-specific problems unique to their vertical markets, PKWare now packages its products for targeted industries – financial services, health care, governmental agencies and retail – where it sees the strongest growth potential. Its ability to compress data and secure that data with encryption tools enables the company to target industries that deal with large but highly sensitive pools of data, Newton said.
“There is now a lot of focus on health care where you have big data files and HIPPA (The Health Insurance Portability and Accountability Act) regulations driving new regulations requiring that medical records and health care information be protected,” he said. “That’s a problem that we can solve through compression and encryption.”
Financial services companies such as banks, insurance providers, credit card processors and mortgage firms have used PKWare’s compression technology for years, and the company is now working to sell them security services, Newton said.
“Financial services is our strongest vertical market,” he said. “We’ve got great (market) penetration on the compression side, and we’re starting to get traction with security. But we have a long way to go.”
One of the PKWare’s most successful sales in the last 12 months was to the Federal Aviation Administration (FAA), Newton said, and it is actively pursuing additional sales to governmental agencies.
For additional growth, PKWare is now working to develop supply channel and distribution partners that will sell its products in conjunction with their own products and services, Newton said.
The company is paying much greater attention to product development. For example, PKWare’s products have not been compatible with Apple software in the past, but it plans to have Mac OS-compatible compression and security software available by the third quarter of 2010.
“We now have the capital structure in place for growth. When you get institutional capital, you get professional investors who buy and invest in the growth of companies,” he said. “These guys have deep pockets and access to capital, and if there are security-related tech companies that need branding, sales or distribution, they will be ideal for us. And early-stage tech companies would also be great bolt-ons.”
Pierre McMaster, a general partner with Novacap Technologies, which now owns PKWare, and Demian Kircher, managing director with Chicago-based Maranon Capital, which financed Novacap’s purchase of PKWare, said their firms are interested in helping PKWare make acquisitions when the company is ready.
“We support Miller and the management’s strategy, whether acquisitions of products, IP (intellectual property) or companies are part of it,” Kircher said. “We would be in full support of that and have the capital to support it.”
“Sales and customer service will grow the fastest, then product development and then maybe marketing,” Newton said. “With economies of scale you end up not growing the back office and support as fast as you do customer service and development.”