How to create your own IT company: the history of Provectus IT

In preparation for a unique event for the IT industry - online conference on B2B sales and marketing of IT services and products Conformato.org - we decided to interview several of our speakers.

Today our guest is Gennady Galanter - co-owner of Provectus IT - a person who has been selling IT solutions and services for almost 20 years.

The very same company Provectus IT impresses with its growth. October 10, 2010 - 22 employees. In 2014 there are already 270 people, and, as I understood, this is not the limit.
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At the conference, the report of Gennady will be about the so-called "Whales" - big customers with millions of contracts: how to find them, how to build relationships with them and, finally, sell.

- It is known that you, at Siebel Systems, acted as Director, responsible for the 120-million product line. This is a very responsible position, so I would like to know what was your responsibility and what kind of experience did you get?

- To begin with, Siebel is a pioneer in CRM, which was absorbed by Oracle in 2006. By the time I had 15 years experience.

Much of what I know and can do today, I owe to the experience gained in Siebel. I was lucky - one of the distinguishing features of Siebel was that the company had a special attitude to recruitment. Natives of prestigious universities and elite colleges of the world were recruited. Thus, a company culture was created that promoted innovation in product creation, business development and a market approach.

I vividly remember the interview with my future manager at Siebel. I was asked a question: “Where do you see your function as the leader of this group?” To this I answered with a story:

“You know, in the circus there is such a juggler, who has long sticks, and the plates are spinning on them. And he starts to unwind these plates, add even more sticks, unwind even faster. And here comes a moment in time when these plates start to slow down, they need to be twisted, but they just don’t have enough hands. For all the plates just do not keep track.

Somehow you need to let fall and break. The question is how? My opinion is: you need to determine which of these plates are porcelain, and which - clay. And let it fall clay plates, keeping the more valuable. "

After that, they immediately made me an offer to take up the position of Product Line Manager.

Siebel itself had an excellent definition of the role of a Product Line Director - this is the CEO of their product. Those. it was necessary to make all decisions in relation to a specific product. The company had 120 products, and they had to go out synchronously and choreographically 2 times a year. This means that it was necessary to build a Product Plan of your product in such a way as to be in time for the day when everyone else enters the market.

- Then you worked for 4 years as a Strategy Director at Exigen Services. What happened to the development of the company during this time?

- Exigen is a global company with offices in San Francisco, the Baltic States, Eastern Europe, St. Petersburg, Odessa and Dnepropetrovsk.

By that time, wage inflation in the field of Information Technologies had occurred in Eastern Europe. This led to a decrease in the marginality of outsourcing projects. And selling at a higher price was difficult, because at that time the buyer lacked a simple message.

My task was to develop an approach to the market in order to increase margins from services. It was necessary to create a unique “value proposition” in order for the client to be willing to consciously pay more. But at the same time he understood that the service received in return compensates for the premium cost of services.

The fact is that Exigen's strategy was to hunt projects not for $ 100-150 thousand, but for $ 10-20 million. These are the projects that we now call "Whales". (I am going to speak about them at the conference.)

When we collected statistics on the success of large projects, it turned out that there were a lot of examples when multi-million projects failed.

We understood that there is a fundamental difference between the interests of the project’s customer and its performer. This happened because, in the conventional model, the client comes and pays the contractor for the watch, and carries all the risks. And then we came up with the model of "Flex-agility", in which the performer on the "same wavelength" with the customer and takes some of the risks. We developed a new approach to the market, patented this model, began to actively promote it and began to implement projects according to the Flex-agility methodology.

- How did you come up with the idea of ​​creating your own company? And what is her success?

“Everything here is trite and simple - I am by nature a serial entepreneur, i.e. a person who is constantly engaged in business activities.

In the summer of 2010, the food software company Selectica turned to me, which at that time could not sell its main product.
The owners could not understand what was going on, fired all the employees (up to the CEO) and recruited a completely new team. They began to lift each stone and see if there was a viper there. It turned out that the problem is in the Indian team of 50 people, which did not have an innovative approach to the product.

I understood perfectly the difference between Indian and Ukrainian programmers. This is also understood and the new part of Selectica. They called me personally and said: “Get on a plane to Odessa and start a business there”.

Since I am by nature a typical businessman and salesman, I needed an operator. It was then that I called Nikolai Antonov, whom I met back in Exigen. I managed to persuade him to join me, and now he is my full-time partner. I consider this my biggest professional victory.

Because an extremely important truth in life is that for success you need to surround yourself with people smarter than you.

Also part of our success is that we started our business from an opportunity that we had, and not from scratch. And I, being my entire career as a product buyer, know what questions I care about, and therefore I speak the same language with customers. That's how we built Provectus IT as a company that meets the needs of customers. And now the company already has 270 people.

- Tell me, what does the name of your company mean?

- The name is directly related to the business in which we are. We position ourselves as a developer company that performs orders of increased complexity. Advanced engineering talent. Innovative solution.

And then I had the English word “Advanced,” which means “advanced,” but unfortunately, all the domain names were already taken. Then we showed creativity and found the word “provectus” - this is advanced, but in Latin. Thus, Provectus IT is an advanced, advanced information technology.

- Where did you spend the first money from the deal?

- Money from the first transaction, as well as from all subsequent ones, we invest in a business.

From the very beginning, Nikolay and I agreed that we bring only what we need to live to the house, the rest is for the development of our company.

- With which countries have you managed to work during this time?

- For 4 years, statistics on countries is approximately as follows:

• 80% - from America, almost all - from Silicon Valley
• 15% - from Russia
• and the remaining 5% are customers from Northern Europe, Israel

Why the vast majority of US? Because you need to understand the market in which you sell. And for this you need to live inside.

- How are your sales built - are these mostly personal contacts, or are you trying to sell technical expertise of your company?

- Projects that come to our company are divided into two categories:

• multi-million dollar and long-playing projects
• "Small" (at the moment our definition is 20-150 thousand dollars) and average

The hunt for multi-year projects - "Whales" - lies with me and is based on my connections. After all, just because no one “Kita” outside does not issue. Therefore, sponsors are my acquaintances and friends, people with whom I worked during my career. “Small” projects come through the website, so we sell technical expertise to our company. Also, word of mouth works great. It is very important how we worked with this client.

I'll tell you a little story:

One of my General Manager (GM) came to me, who is responsible for mobile development. We went with him to the Coffee Shop, where a black woman cleaning lady approached us and said, “Hi guys. How are you? What are your plans for today?"

I answered her “We are doing fine. Here we go to the Apple conference on the opposite side of the road, ”and we said goodbye to that.

My GM asked if I knew this woman earlier. I replied that I had met her for the first time. To which GM said: “If someone unfamiliar came to me on the street and, smiling, asked what plans I had ... I would give to melon.”

This story is about how people in the US are used to being treated mildly. Americans expect a "hotel in services". And this is not at all obvious until you live in the country.

- At what stage of the sale do you use technical support?

- I just have a good Use Case in this regard. Yesterday was the first call from customers. These are the two founders of a startup who are not techies, but rather ideologues. They told about themselves, what is their product idea, I, in turn, about Provectus IT.

Today, before the interview, they called me again. They began to ask how they can show a prototype of the product and screenshots. And then I told them that I am the wrong person for this, and we can spend a lot of time without result. It is better to tell this to the person who will ultimately be responsible for the product.

In this way:
Stage 1. A lead on a new project comes to me, I am doing the first introductory.
Stage 2. I talk about what we have specific specialists, doing in-depth introductory.
Stage 3. When the words Magenta, .NET, Java and so on begin to be pronounced, I arrange a meeting / call with techie.

As a rule, we have 2 or 3 people going to such a meeting:

• potential project manager with technical knowledge
• business analyst
• and maybe the designer

And then technicians determine if there are enough materials to ask the right questions. Then, getting all the necessary input data, evaluate the project.

But it works only for “small” projects, for “Whales” everything is different.

- Tell us, please, what tasks do “Whales” set, and how do you solve them?

- “Whales”, as a rule, do not look at a specific amount of work and do not ask us to estimate how much it will cost. They set completely different tasks. Our task is not just to complete the project, but to find people who will work for them and not go anywhere. We then begin to look for specialists among our employees or in the labor market.

We have 6-7 recruiters who are constantly engaged in searches in the market and are trying to fill open positions. People are interviewed with HR `s, then a technical interview. And only then we decide whether to show them to customers. The main task of "Whales" is to create a team that will sit in Odessa, Kharkov or Dnepropetrovsk and will be part of their grocery organization.

And I tell them:

“Imagine that your team is not sitting in Dnepropetrovsk, but next to you. Here you are sitting in your building in Silicon Valley, and they are in the building across the street. You will have exactly the same feeling. ”

And this is what we sell now. For such clients, it is important not only to create a team, but also to keep it.

Investments that are invested in each person listed in the team are very large. This is both money and time, knowledge and other resources. And when a person leaves, it is very painful for the timing of the project. Especially if this team is not from 50-80 people, but, for example, from six. Those. It’s important not only how quickly we can bring the number of people needed by the clients, how good the quality is, but how we plan to keep them.

And then I can tell them that our Attrition Rate (how many people voluntarily leave per year) is 9%, while the average in our industry is 18%. And this is 2 times less!

We have created such a climate in the company that when people consider alternative positions in competitors' companies, they do not make decisions easily. They leave only when necessary and, while doing this, they simply cry. Or they were offered a salary several times more. And we do not fight with money. We just organized such a team, from which it is very difficult to leave.

At the very beginning, Nikolay and I went to Apple, Google, Yahoo, Facebook, we were allowed into their campuses and offices, where we all took pictures.
And on arrival in Odessa, we built offices that are just as organized. And this created environment perfectly stimulates both the work and the social life of the company.

We have a lot of entertainment: we go to each other on birthdays, arrange ping-pong championships (they come from all over Ukraine), go out into the countryside, swim in canoes, etc.



This means that we have a very large social component of the life of workers. For us, this is important, because ultimately, it is necessary that the situation in the team be stable.

- As a person with great professional experience, make a forecast for the coming years: which IT areas will be developed most quickly in outsourcing?
- I can only tell what I see in Silicon Valley.

1. In the United States, a law was adopted, known as Obamacare , which resulted in fundamental changes in the field of payment for medical services. Doctors will receive much less from insurance companies.

And now you need to optimize many things that previously could be neglected. The entire medical database was stored in paper form (in folders in the cabinets). Now all this data will be digitized and the subsequent processes will be computerized.

For example, now the doctor will go to the patient not with a folder of papers, but with an iPad. Instead of the doctor asking the patient what diseases he had previously, whether there are allergies, etc., the patient will be issued an iPad on which he will fill everything. And by the time of the doctoral examination, the doctor will have all the data about the person. In connection with such changes in the medical structure, we see a huge increase in needs in the field of outsourcing services.

2. Wearables. Devices that can measure the health of the person who wears them on themselves.

Perhaps in the future, they will be integrated into clothing. There is a development of biotechnology and their combinations with IT.

I think this system will be improved. For example, wearables will talk to the information domain. Having measured the condition of a person, he will request in the central database, maybe a person should drink orange juice, eat some fruit or take a pill to maintain health. This will be a qualitative transition to the formation of the ecosystem of each person.

Today, such technologies are seen as a big trend.

3. Cloud - cloud technology. Many companies, until recently, refrained from placing their servers on Cloud. They do not want to do it.

And from the point of view of the outsourcer, this is an interesting task. Today, this type of service is popularized, and we are also engaged in this.

4. Network Operating Systems. Imagine a person who sits behind a screen and monitors a client’s network status. And when problems arise, fix them with the help of special scripts.

Today, these are people of customers. We offer a service that allows you to remotely monitor the state of the customer’s network and follow their script if any problems arise. This service is called the Network Operating Center.


5. Bitcoins. Now one thing is obvious: a platform was created, which the US Congress is beginning to seriously study.

While a lot of cash flows through bitcoin, this virtual currency is not controlled at all. And now it is difficult to say where this will go next and whether it will be at all. Due to the fact that it passes "by" states.

There were abuses such as the illegal trafficking of drugs and weapons. I think that if regulatory measures are taken, bitcoins can be a promising direction. Including for us - outsourcers.

6. Big Data. Today, companies are looking for a competitive edge, which they find through access to large databases and their analysis. Hence the concept of Big Data.

Today we have a huge need for Data Scientist - these are doctors of science, professors who understand how to model, process and analyze huge data arrays. In the US, they are, but they are just crazy money. We also have such specialists, and we provide such services. This seems to me an interesting, promising topic.

7. Smart Grid. Rising prices in the field of energy has led everyone to try to optimize energy consumption. This is done by smart meters. What can they do?

For example, when you signed a contract that you will have the main electricity consumption from 6 to 9 pm, and actually consume it at another time, it turns out that you are breaking the contract and penalties will be applied.

In general, these are systems that allow balancing power consumption. This is also a big topic now, and we are also working on such a project.

- Do you like your job? How do you relax?
I do not work. For me, Provectus is not a job, but a lifestyle. I get energy from the fact that I can make my personal contribution to its development and build a team of people who are more to me than employees. They are my family.

Yes, I get tired, I can not always eat for a whole day, but I still do not consider Provectus to be my “work”. This is my child. Actually, I love to travel. Over the years of life and professional development in the West, I flew a lot for work. We can say that I just lived at the airport of San Francisco. I flew out on Monday morning and came back on Friday evening, and so 11 years.

During that time, I traveled the whole world. And, of course, I love to be in dear to me cities. I love Paris, the city of Bruges in Belgium, I like to walk through the cozy streets of old Europe. And sometimes they still manage to escape for a short rest, where you can forget about business, transactions, sales and customers. And then you can just lie on the beaches of Hawaii and Mexico.



Well, so, rest for every day? I go to the swimming pool. At least four times a week swim by mile.
It helps for transparency of thoughts. Highly recommend.

PS By the way, everyone who has not yet registered at the Conformato Conference 2014 will be happy to see. Participation is free .

PPS Dear moderators, if this is possible, please add this post to the IT Biography hub. This is my first post, so there is still little karma. Thank you in advance.