'Those who ignore the power of search engines will soon find themselves out of business' - Andrew Patterson discovers a NZ tech company listed on the Frankfurt exchange

By Andrew Patterson

Optimizer HQ might be one of the country’s hottest technology start-ups right now, following its recent listing on the Frankfurt stock exchange.

In fact, a posting on its website offers a clue to its corporate mission.

"Those who ignore the power of search engines will soon find themselves out of business."

The brain child of 31 year old founder Manas Kumar, his story is testament to the power of ambition over circumstance.

Arriving in New Zealand 11 years ago as a young migrant from India, alone and with not much more than $300 in cash, his ambitions for his business were never going to be constrained by his limited financial circumstances.

However, securing a job proved more difficult than he expected, despite having a university degree in economics with a major in mathematics.

A string of part times roles that included flipping burgers at McDonalds by day and selling credit cards at night, while all the time sleeping rough near Britomart , was the ultimate in self-sacrifice to save the necessary money to realise his business ambition.

In between jobs, teaching himself web design, allowed the fledgling business to take its first tentative steps towards becoming a reality.

It was almost straight out of that feel good movie The Pursuit of Happiness based on an out of work African-American salesman living in the subway who dreamed of becoming a stock broker.

A professional cricketer in India, Manas Kumar’s career progression was unexpectedly cut short after a motorbike accident brought his playing days to an abrupt halt just six months after signing his first contract.

However, that accident forced him to leave India, where his extended family remains, and back himself with ambitions to play cricket professionally first in South Africa and then in New Zealand.

“Unfortunately I completely forgot to allow for the fact that the playing season here is the reverse of the Northern Hemisphere and I arrived just as the stumps were being pulled for the year.”

The oversight meant that his plans had to be rapidly reformulated in order to earn a living.

Early Days

The idea of creating a technology company that focused on integrating various marketing functions which are generally kept separate, began to take shape as a business model for the new company.

“I always felt like I wanted to do something different and so I decided to enter the online space because that’s where all the action was and so I started the company with exactly $10.”

However, like all technology start-ups the early days were a struggle.

“I remember our first office was about the size of a match box. There was barely enough room to fit a couple of desks for myself and my sole employee. We borrowed all the furniture and were able to lease a couple of laptops to get us started and I remember feeling so excited when we secured our first paying customer which came with a fee of $4,000. That was the point at which I thought: we can do this.”

Business model

These days Optimizer HQ is increasingly defining a niche in the market that many businesses are struggling to address. How do you use a proliferation of marketing tools: email, text, social networking, customer relationship management programmes in an integrated way to drive bottom line revenue growth?

“Business is about finding, winning, keeping and growing your customer base. We’ve developed technology tools that facilitate each of these four important aspects of business engagement with customers utilising an online platform.

It’s no longer just about finding customers; it’s also about customers finding you so search engine performance is critical these days. If someone comes to your website how do you convert that visit into a lead and then ultimately a sale and how do you then manage that on-going customer relationship. So what we do is integrate all of these elements to grow the business from within.”

Customers pay a monthly subscription fee requiring no capital outlay, no contract, the end users simply pay a fixed amount per month to use the software. The company says it also offers free upgrades, unlimited technical/customer support topped up with oodles of love.

With offices now in Hong Kong and the United States and customers in almost 20 countries, including 12 of the G20, the company has grown rapidly since its founding in 2005.

“80% of our customers are outside of NZ, so effectively we’re an exporter of technology services.”

It boasts some well-known international brands in its stable of customers including Burger King, Foot Locker, Quick Office, which was recently acquired by Google, and South Australia Tourism.

Its latest acquisition is an animated graphics company which is designed to help companies explain their ideas in pictures making things much simpler for incorporating into websites.

“In an online space, if a picture is worth a thousand words, how many words is a video worth.”

Competitive position

Optimizer HQ defies the stereotypical image of technology start-ups operating in designer offices reminiscent of the Googolplex or Facebook’s new designer headquarters.

The company’s head office, located near Auckland’s old Railway Station, is basic but functional and definitely not designed to impress. This is a business that has better things to do with its money. However, you do notice just about every wall is covered by a whiteboard.

“We’ve positioned ourselves as a technology factory and our mandate is to produce world class technology and it isn’t to have the fanciest chandelier hanging from the ceiling. We would much rather use that money to develop resources and further improve our R&D capability.

We work collaboratively, hence the open plan and the proliferation of whiteboards everywhere, which I have to admit is starting to annoy the landlord, but we certainly do a lot of white boarding that’s for sure.”

Listing on Frankfurt Stock Exchange

Optimizer HQ became a publicly listed company on the Frankfurt Stock Exchange in December 2011.

Manas Kumar says the decision was based on the simplicity of the listing process and at the time, the proposal for an alliance with the New York Stock Exchange which offered the prospect for a secondary or even a primary listing in the United States.

“It’s been great for our profile. We received a lot of coverage internationally at the time of the listing and it’s also been good from a capital perspective as growth requires a lot of capital.

We see ourselves as a global company and from that perspective an international listing, as opposed to being listed on the NZX, made sense in terms of our business objectives.”

Talent

Finding staff not just with the right qualifications, but with a global focus is the company’s biggest challenge.

Having doubled its staff from 8 to 16 in the last 18 months, there are plans to double it again in the next 18 months if only those staff could be found.

“We struggle to fill various positions open in the company at all levels. The issue we face is finding the right people – there’s a huge drought in talent.

When we hire developers they have to go through our own internal testing process so where we’re coming unstuck is finding staff with that global perspective because customer service in Asia is very different to what’s expected in North America.

If you take marketing as an example, we’re looking for people who understand our space. There are lots of people out there with good marketing qualifications, but most of them have a strong traditional mind set towards marketing. They’re not very savvy around the whole idea of social marketing and its integration into the online space.

I also think our education system, at all levels, needs a much greater global perspective in what is taught. We need to be raising globally focused entrepeneurs. If we want to retain our top graduates we have to be creating top level companies as well and we need to be instilling in young people a belief that says you can create the next Google, Twitter or Facebook and you can do that from here.”

Future

So where does Optimizer HQ hope to be in five years?

It’s a question that Manas Kumar is quick to answer.

“Five years is too long. We really have to think in shorter time frames because technology is moving so rapidly and while we have a road map for the next 3-5 years there is the potential for forks in the road that may require us to deviate from that plan.

I have a real ambition to see NZ gain momentum and really become a strong force out there in the global market place where we’re not just good exporters of dairy and agriculture products but we’re also good exporters of technology.

Creativity has no boundaries. It doesn’t operate within the boundaries of people. What we have to do is recognise creativity and let it prosper.”

Could it be that Optimizer HQ is New Zealand’s poster company for our future?

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