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Key To Success: Hit The Ground Running
Company: Edge Technology Inc.,
110 Washington Ave., (203-234-2336)
No. locations: 2 (also at 90 Park Avenue, New York, N.Y.)
Founded: January, 2000
Startup costs: $250,000
Revenues (current year): $4 million-plus
Principals: Ralph Durante, President & CEO, Leonard Matteo Jr. and Joseph Lion, both Senior Vice Presidents
No. employees: 85
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Business New Haven
4/30/2001
By: Priscilla Searles
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Edge Technology Services Inc. in North Haven, started less than a year and a half ago and it that short time has grown from four employees to 85, doing over $4 million in sales the first year. Edge provides management strategy solutions, the company's staff are all computer science people who provide technical support for large corporations such as writing software systems for special applications.
Conecticut-born and -raised, Durante worked for IBM for 16 years before moving to C.W. Costello & Associates as CEO. “We went from startup to $75 million in sales in ten years,” recounts Durante. “But when Complete Business Solutions acquired the company in 1998 I missed the challenge of starting up a company, of getting it rolling, calling the shots. I became a vice president in Connecticut, but it wasn't my company any more - I was working for someone in Detroit.
“Two friends came to me and proposed that we start a new company. They wanted to do it but they didn't have the money, and I did. We talked about the possibilities, kicked it around for about a year. The two partners are Leonard Matteo Jr. and Joseph Lion, both of whom serve as senior vice presidents.
“We knew we were aiming at Fortune 500 companies, plus we had targeted some key people in the industry to come and work for us. While we were doing the planning, we starting marketing our services. I wanted two deals on the table before we started.” says, Durante.
Durante put $250,000 of his own money into the business. “I didn't want to rely on venture capital or banks,” Durante explains. “The advantage of not using someone else's money is that you keep your eyes on your own ball. We don't have anyone telling us how to run our business. It lets you work hard, head down, focused, not worrying about the backers.”
Durante's next decision was one that many new businesses could learn from. To keep costs down he rented a time-share office. “We rented one office in a building with a time-share. We didn't have a secretary; we shared two people out front who answer the phone for the whole floor.”
Since then, Durante says, “We've expanded to five time-share offices and now it's time for our own office. We picked a building where we could go from time-share to our own space in the same building. That was planned up front. That means we keep the same phone number, the same address. You have to start lean and mean, keep the costs down. With this arrangement we don't have to reprint 85 sets of business cards. All my investment in literature is not going to be wasted.”
Another money-saving decision was to stagger the starting times of the principals in the company to keep payroll and overhead down. Matteo started first and 30 days later Lion officially joined Edge. Durante worked two jobs for the first ten months.
Growing rapidly, the company opened a second office in New York in February, and a third is planned for Boston. “We opened the New York office because there were clients that needed to be serviced in that area,” Durante explains. “You find your client opportunity, one big enough to make it worth your while to locate in that market area. The second thing you do is to find a rainmaker, someone who can take the ownership and sales leadership and make it work. Third, you have to like the city and for us it has to be a mecca for Fortune 500 companies.
“This is a relationship business,” says Durante. “The clients know I know the solutions, that I'll provide the right people to get the done at a fair price and on time. Then I must deliver, and hopefully that's why we've been successful. The client has to trust you. And the fact that I've been in this business for so long meant that I knew who to target.”
What comes through loud and clear in Durante's blueprint for starting a new business is that everyone has to pay their dues, which is why it is unwise to wake up one day and decide to start a new business if you have no experience in the field. Successful entrepreneurs know there's no substitute for doing your homework.
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