How FedStore became the fastest-growing small business in the federal market
Top-ranked Fast 50 company records 340 percent annual growth
- By David Hubler
- Oct 08, 2010
Founded in 2001 by brothers Jack and Andrew Cayouette as a service-disabled veteran-owned small-business reseller, FedStore Corp. made its first appearance on the Fast 50 last year at No. 7, reporting $28.05 million in federal sales in 2008.
The company, based in Rockville, Md., almost doubled that figure last year, with $41.14 million in sales, and hit a compound annual growth rate of 340.16 percent over five years. That made FedStore the top-ranked company on the 2010 Fast 50, outpacing its nearest competitor on the list by about $10 million in federal sales.
“We consider ourselves more of a solutions provider than a value-added reseller,” said Matthew Cayouette, another Cayouette brother, who joined the company in 2007 as vice president and general manager.
In addition to selling hardware to the Defense Department, intelligence community and civilian government clients, “our primary focus is providing solutions around general networking, network infrastructure, information assurance, storage, and systems and management,” Cayouette said.
The company is well stocked with government clients for services and hardware sales.
He cited the NASA Solutions for Enterprisewide Procurement (SEWP) IV governmentwide acquisition contract as FedStore’s premier contract vehicle and the driving force behind FedStore’s growth.
In addition, FedStore is providing the Veterans Affairs Department with network infrastructure, information assurance and storage services.
Cayouette said he expects FedStore will increase its business with VA as the department expands its videoconferencing hardware and services among numerous offices and divisions.
The company also has a blanket purchase agreement with the State Department for enterprise servers, “in essence a hardware buy,” Cayouette said.
“The story there is we wanted to get additional penetration outside our primary accounts,” he explained. “So this was a nice segue into" the State Department.
Cayouette predicted that FedStore will exceed its 2010 revenue targets. “Without getting into the nitty-gritty, our goal is obviously to try to grow by at least 50 percent year-over-year,” he said.
“It’s a pretty aggressive goal,” he added. “But there are no encumbrances. There is nothing really in our way other than our ability to reach out to the federal agencies and gain traction and momentum and penetration within those agencies.”
Despite the federal government’s tightening budget, Cayouette is forecasting that FedStore’s federal sales figures will grow again in 2011.
With that in mind, he said, the company is pursuing an aggressive plan to increase its workforce from 20 employees to perhaps 50 by mid-2011, including new hires in sales, operations, business development and finances.
“From our perspective, it’s really vetting and deciding where our core strategy intersects with government need — that, in essence, is where we’re going to do the most hiring,” he added.
“There is always a need in the IT industry in particular, it’s basically the backbone, if you will, and the driver of communication and data flow within the federal government,” he said. “So we actually don’t see that there’s going to be a huge pull-back in dollars spent on the IT side, although potentially there will be some."