Avani Technology Solutions Inc. has grown from a $7.5 million firm in 2013 to a predicted $26 million in revenues by the end of this year.
By 2020, its leaders believe the company will reach $100 million.
“One hundred million dollars is sizable revenue for us to do some larger transactions or make a bigger investment or attract bigger customers,” said Sameer Penakalapati, president and CEO. “You’ve got to have that mass size otherwise you’re competing with small players. I know—from now through 2020—$100 million is not an easy task. It is doable, but I’m also not just relying on organic growth but also growth through acquisition.
“I think we’ll be in good shape,” he added.
The company has grown from seven staffers at its launch in 2010—Penakalapati formed the company in 2008 but did not start business activity until two years later—to some 210 employees, including 45 people in Rochester. The firm expects to add 10 staffers here by year’s end. The firm will add 20 employees to offices outside of Rochester this year as well.
“The challenge always is finding key talent,” Penakalapati said. “We try to hire college kids, but a lot of times our industry needs more experience. I don’t expect that challenge to go away, but we’ve prepared for that.”
Last year the firm purchased a 43,000-square-foot business park at 687 Lee Road. Avani uses 8,000 square feet for its offices.
“We’re here to stay,” said Mitch Meller, vice president of IT services. “We’ve invested in this community. We provide quality IT services and solutions at an affordable rate right in your backyard.”
Avani is working on an acquisition locally that could help propel the company forward, officials said. They did not disclose details. The deal is expected to close this summer.
“We’re going to continue to grow,” Meller said. “(In five to 10 years) our revenue will be over $100 million and we’ll probably have over 600 employees working on software products and providing IT Consulting services.”
The company now focuses on a market segment that strongly needs technology services.
“(We) focus on small-to-medium-size businesses—they’re more agile, more tech savvy—that’s where we see a lot of growth,” Penakalapati said.
The company operates in 16 states and has seen its products take off, including Human Capital Management—a product ahead of its time when launched in 2013, officials said. HCM generates some $1 million in revenue and serves about 300 customers.
At that time the market was not embracing the cloud as much as it is today.
“There’s this shift in the IT services industry from the traditional ERP platforms to the cloud and mobile space,” Penakalapati said. “We were happy to be in the front seat doing this stuff. That confidence that we’ve built in helped us to go tell the story to customers, and we help them build products for their own businesses.”
Seeing the future of the industry has come naturally for Penakalapati.
“It’s not tough—I know this technology,” he said. “I had this idea (for the cloud product) in 2010 (but) I didn’t have the money in 2010 to do that. (From) 2010 to 2013 I did not see much vacation. We worked seven days a week, we worked really hard and we really lived within our means to build this business. We put every single penny we earned back in this business.”
While leaders know where the industry is going, it does not mean the industry is slowing down, Meller said.
“The fast pace of the industry forces you to constantly renew your tools and practices,” he said. “Think of the way many of us receive our news or do our shopping online. We don’t have to wait for the 11 (p.m.) news or wait for the store to open. Look at the impact of social media. Driverless cars are around the corner, and IT is a part of it all.”
The business climate for tech businesses in Monroe County is starting to sort itself out, Penakalapati said.
“Rochester is a great technology town,” he said. “We’re not Silicon Valley, (but) at the same time we’re not behind too. I think we will see more and more startups coming in, and I’m hoping we’ll make more and more investments here.”
The Rochester Top 100 program is presented by the Greater Rochester Chamber of Commerce and KPMG LLP. Launched in 1987, it recognizes the fastest-growing private companies in Greater Rochester. The 2016 Rochester Top 100 event will be held Nov. 2. For more information, go to greaterrochesterchamber.com.
Avani Technology Solutions Inc.
Provides software development, custom software and IT consulting services.
Year founded: 2008
Top Executive: Sameer Penakalapati, president and CEO
2015 ranking: 23
Current employment: 210
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