4Projects’ success grows
Aug 28 2008 By Karen Dent, The Journal
A SOFTWARE company is establishing bases in the US and Canada a year after being bought out by its senior management.
Sunderland-based 4Projects was previously part of the Leighton Group but was taken over for an undisclosed sum by its executives and private equity firm August Equity 12 months ago.
“It’s been a really good 12 months. We have continued to increase revenue, turnover and most importantly for the region, we have increased the number of staff up to 60 people,” said marketing director Duncan Mactear.
“Working with a new investor has been a real boost to the company. They have skills they have brought to the table.”
The Doxford International Business Park company increased turnover from £3.2m in the year to the end of March 2007 to £4.4m the following year.
Mr Mactear believes the company's business plan has stood 4Projects in good stead as the credit crunch bites.
“Software as a service is our business model. Rather than the business buying a licence, our clients lease the software and they pay a monthly figure. It makes our revenues very predictable and we can predict them well into the future.
“It’s a relatively new method. Everything we do is delivered over the internet – it makes it so easy for people to pick up and use. In the current economic situation people are more prepared to lease than buy.”
One of the first things August Equity did after investing in the company was to make a 100-day plan to move the business forward. 4Projects focused on finding new markets overseas.
Mr Mactear said: “The private equity company had run this before. It made us focus immediately after the deal.
“We opened an office employing one permanent staff member and a consultant in Houston and there is a lot of activity in Calgary in Canada.
“I think it’s almost impossible to sell to Americans from the UK. You really do need someone out on the ground.”
The business aims to open an office in Canada shortly and expects to employ five staff between that and its US interests. “It’s a strange time to go into the American market. A lot of companies are pulling back but we are focused very much on the natural resources market – Calgary is very important in the oil and gas industry,” said Mr Mactear.
The company has a number of customers in the construction industry but has so far managed to avoid the fallout from the downturn in the housing market.
“Although people are saying that the construction industry is in severe decline we have limited exposure to that part. It’s very fortuitous that a year and a half ago we started to go into new sectors and new geographies,” said Mr Mactear. It is currently working with developer Sir Robert McAlpine on the Olympic stadium and also deals with IT giant Microsoft, the NHS and the Ministry of Justice. Other major schemes to use 4Projects’ software include the Silverburn shopping development in Glasgow, in collaboration with project manager Heery International.
