A Growing Computer and Internet Company Builds Its Own Success Model

 By JOSEPH BEDNAR

The president of C Computer Systems saw his company grow through expertise but later sputter due to a lack of financial direction. Then a partnership with an old friend turned things around, leading to a successful business strat­egy, a profitable comeback, and steady growth.

Jitu Changela knows technology.

He knows computers - hardware, software, E-commerce - inside and out, literally. But somewhere along the way, he realized that this wasn't going to be enough to run a successful business.

Although his Palmer Company, C Computer Systems, had grown steadily since its inception in 1995, the profits were drying up, debt was high, and even 80-hour work weeks weren't enough.

"There was a point at which I felt, 'wow, I've come so far,"' he said. "But it felt like I had come against a brick wall, and I didn't know where to turn. What else could I do?"

That was only a couple of years ago. And the answer, it turns out, had nothing to do with Changela's expertise in - or enthusiasm for computers. Instead, it had everything to do with his business model. That's when a lifelong friendship turned into a partnership - and a plan - that now has the firm debt-free, profitable, more diverse than ever, and growing by the week.

 Accelerating Success

That friend is Ken Vaishnav, a business strategist who launched his own consulting firm, VentureXcelerator, in 2000 after serving as operations manager at Anderson Consulting in Boston for three years.

"His enthusiasm for technology is evident. It comes through," Vaishnav said of his friend. Together, they set out to match that strength with a business plan that was just as solid. A year later, all debts have been paid down except for a fixed installment loan for Internet service equipment.

"If you don't execute your idea the right way, you're going to fail, period," Vaishnav said, adding that while not all entrepreneurs fall into the same snares, many fail to ask themselves five basic questions and know the answers before they begin: what is the company's revenue model, cost structure, competition, and value proposition, and can it sustain a competitive advantage in its field?

In Changela's case, his original plan seemed solid. After spending several years working as a sales service engineer, field service engineer, and bench engineer in London, he became a purchasing agent for Synaxis Corp. in Needham, Mass. in 1994. A year later, he decided to use his computer skills to set out on his own, and C Computer Systems was born.

But Changela got into trouble when he began to expand his business from computer servicing and business solutions into being an Internet service provider. Poorly calculated equipment purchases and leases led to debt difficulties.

"About four years ago, a lot of people were asking if we provide Internet access," said Changela. "There was a demand for ISPs, so I went out and bought high-tech equipment, not knowing the financial impact of it"

After a while, however, despite growth in that area, profits were nonexistent. "The income was there," he said, "but where was the money?"

With the debt problem erased, he is now able to better appreciate the potential C Computer Systems has as an ISP. The company offers Web E-mail, domain name registration, co-location, application management, and Web design and hosting from two-page static sites to full-blown E­Commerce sites  among its many services. The Web Email service allows custom­ers access from anywhere in world, a great benefit for senior citizens who travel but want to stay in touch with people, Vaishnav said.

"We offer these various technologies because of the needs of our clients," he said, adding that the diverse range of services business is split fairly evenly between hardware and software, business solutions, and Internet service helps insulate the company against economic shifts.

"If it was only Internet, we might have crashed last year;" he explained. "If it was only hardware, well, the margins are nonexistent. You have to have volume, and we can't compete with the larger companies. As business cycles change, when an economic downturn comes, we have the ability to offset the losses in other parts of our business.

And make no mistake; C Computer Systems is using its diversity to become a larger presence in the Palmer area. Take the dial-up service, for instance. The company boasts 450 subscribers on its modem server, up from 380 last year but a long way from the 3,500 subscribers the system can eventually handle.

"The server is designed so that, as the technology grows, we don't have to make major investments. It's highly upgradable," Vaishnav said. "And we've grown aggressively in the past year"

 Support System

As a business solutions provider, C Computer Systems claims to be unassuming in its marketing but a home to loyal clients that make the firm profitable despite its low profile. Part of that loyalty, Vaishnav said, comes from the type of customer service the company offers.

"We take the technical burden from them and onto ourselves," he says "If something goes wrong on Saturday or Sunday, we're there, no questions asked. It's our job, and we're here to support our clients."

And, of course, the emphasis on individual solutions for individual companies has the force of a credo. "As we work with the companies, we don't want to cram things down their throats," Vaishnav said. "We're not technology driven as much as business needs-driven.

Meanwhile, Vaishnav and Changela have been a support system for each other, working together smoothly to hammer out a business strategy, even when they haven't always agreed. Some decisions became clear; such as the company's recent reliance on Country Bank to manage and restructure its debts. But in all its dealings, an emphasis on integrity and honesty has been key, the pair say.

"The bank is trusting you," Changela said. "You can have the best business plan, but if it doesn't show on your face, you won't get the loan."

Also, "if you don't believe you're going to succeed, get out of it," Vaishnav added. "If you believe you will succeed, that belief will help make it successful."

Other factors have contributed to Changela's success, including the development of state-of-the-art digital lines in the Palmer area in the past 18 months.

"I went through a lot of struggles, but I knew it could work ... I knew it would work," he said. "That positive attitude is what got us here. "If you want to start a business, be pre­pared to put in a 110% effort," he added. "It will take years to get to where you want to get, unless you have an idea so unique that it will be an overnight success."

 Steady On

C Computer Systems has not been quite that, but annual growth around 40% testifies to its success. In 1995, the company recorded $25,000 in revenue. This year; that figure will approach $400,000. But any period of success, no matter how great or small, is no time to rest, Vaishnav said especially in a time of economic transition like the current recession and the recovery expected by many experts next year.

"Most people don't want to stop and think when they're making money," he stressed. "But you must take the time now to ask the right questions, to focus on keeping the business healthy."

"After all," he added, looking to the coming recovery, "if you can make it through next year, imagine what you can do in the next five."  

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