2007 Small Business Report | It's not just about speed

The companies on the 2007 Fast 50exhibit as many differences as similarities.From the No. 1 company with a compoundannual growth rate of 135.5 percentfrom 2002 through 2006 to No. 50 with40.2 percent, the companies making thisyear's list have in common a stellar trackrecord for growth in the federal market.But how they achieved that growthexemplifies the many different ways companiescan achieve success in the governmentmarket. One companysought out the government marketafter its first-choice marketcollapsed. Other companies havefounders who left governmentservice and parlayed that experienceinto private-sector success.And still others were founded by peoplewho left larger companies to launch theirown.To be considered, companies submittedfive years of revenue data, and we rankedthem by their compound annual growthrate.Whatever their roots, the 2007 Fast 50offer lessons for those already in the marketand those looking to join.Oberon Associates Inc., a companyowned by a woman veteran and a servicedisabledveteran, provides informationtechnology services to the intelligence communityand government agencies. It topsthe 2007 Washington Technology Fast 50list.Veterans David Young and Jodi Johnsonfounded the Manassas, Va., company in2002. It has since grown to 400 employeesand reported $48.4 million in governmentrevenue in 2006, for a compound annualgrowth rate of more than 135 percent.When the pair launched Oberon, theyhad little money and no customers. Theydid have experience in federal contractingand the acquisition process."We spent the first six monthsbuilding the infrastructure,"Johnson said, and they got asmall line of credit in 2003from Acacia Federal Bank."Today we have a $7.7 millionline of credit with them."The first win came in September 2002,when the Office of the Secretary ofDefense offered Oberon an IT servicesand communications contract that wasbeing managed by Science ApplicationsInternational Corp.Oberon ? named for a moon of Uranus? has not slowed since. Johnson said sheexpects the company's government revenuewill be almost $90 million this year, due inpart to six contract wins in June.One of them ? the Defense NetworkManagement Support Services Global contractfrom the Defense InformationSystems Agency ? is perhaps Oberon'smost important recent award, she said."What's most exciting for us ... is [that] it'sour first prime contract with DISA."The indefinite-delivery, indefinitequantitycontract could be worth as muchas $86 million over five years.Oberon partnered with SAIC to providecommunications support for U.S.Ambassador Paul Bremer during his yearlongassignment in Iraq. Johnson said theSan Diego-based contractor has been a keyasset in Oberon's success.The company is also working with SAICon biometrics projects for the DefenseDepartment. "We have designed and developedthe Biometrics Automated Toolset,"Johnson said, which is used to identify andtrack suspected insurgents arrested in Iraqand Afghanistan.In addition to biometrics applicationsand integration, Oberon's core competenciesare intelligence support, communicationsengineering and enterprise data management,the company's newest area ofbusiness."I think we will continue to enjoy significantgrowth," Johnson said. "Obviously,doubling in size will get harder and harderto do as we continue to grow."Despite the demands of the job, Johnsonstill manages to find time to attend most ofher three sons' soccer games, a feat she is asproud of as Oberon's success.2020 Company LLC, which providesprofessional services to civilian agencies, opened for business in Chicago in 2000with an enterprise resource planning contractfrom the city. One year later, it won itsfirst federal contract from the ArmyNational Guard.A totally self-financed company, 2020ranks No. 9 on the 2007 Fast 50 list, havingrecorded $9.5 million in governmentrevenue in 2006 for an 89.9 percent compoundannual growth rate from 2002through 2006.In 2001, with guidance from the MilitaryPersonnel Services Corp., the company wona GSA Schedule 70 contract and secured an8(a) designation. As a result, 2020 remainsclose to its mentor."They're a sub to us now, actually," saidHaresh Bhungalia, co-founder and chiefoperating officer at 2020.The company ? which had grown to 45employees ? moved to Falls Church, Va., in2004 but retained a presence in Chicago."Today we're past the 170 [employee]mark," he said. "And we're on target to doupwards of $20 million in revenue thisyear."2020's major clients are the Educationand Commerce departments and theNational Oceanic and AtmosphericAdministration. The company has smallercontracts with the Agriculture and Energydepartments.The vagaries of the federal market thepast few years have not affected 2020,Bhungalia said. "We've actually grown asan organization through that time period. Idon't know that the market has changed somuch as we have a better idea of what it isthat we want to focus on."Bhungalia estimated that 2020 is nowthe prime contractor on as much as 75 percentof its government work."We partner where appropriate with thecompanies that we need to," he said, citingAccenture Ltd. and Booz Allen HamiltonInc. as partners.2020 is one of several contractors workingwith Northrop Grumman Corp. on arecently awarded $90 million contractfrom the Centers for Medicare andMedicaid Services, in Baltimore, to providedatabase and data administration services.Bhungalia said USDA farming grantsand federal student loan administration forEducation will be important parts of 2020'sbusiness by 2012. But the lion's share willcome from health care IT. "I feel very confidentgoing forward that we'll be able tobring a strong value proposition to thatarena," he said.The founders of Ambit Group LLC creditthe company's rapid growth to a namechange in 2004 and a new business planfocused exclusively on the governmentmarketplace. "That was a sea change," saidJohn Condon, chief executive officer andco-founder of the company. "Ever sincethen, we've been on a really nice growthcurve."Ambit ranks No. 10 on the 2007 Fast 50,with $3.7 million in government revenue in2006 for an 89.6 percent compound annualgrowth rate.The woman-owned, service-disabledveteran-owned small consulting companyhas grown from about 10 employees in2002 to almost 50 in 2007. "And we'llprobably [have] about 70 to 75 by the endof this calendar year," Condon said.The Reston, Va., company recently won afive-year, $22 million prime contract fromthe Federal Communications Commissionto provide database infrastructure, analysisand Web support."Overnight, we added 12 people to ourstaff," he said, "and since that contractkicked off, we've added another five."Condon said he expects Ambit to record$5.5 million to $6 million in revenue in2007. "And we're very confident ? particularlywith this new [FCC] win ? that we'lldo around $11 million next year."Kim Shackleford, Ambit's president andco-founder, said the company is now theprime contractor on 85 percent to 90 percentof its work. "Actually, with this win, wemove closer to 95 percent."Other government clients include theSmall Business Administration, EnvironmentalProtection Agency, USDA andCommerce.Steve Ikirt and his wife, Debbie, startedInformation Innovators Inc. in 2001 in thebelief that his 20-year Army career and hergovernment sales experience would givethem a good chance at success.So they bankrolled the company andentered into subcontracting partnershipswith a number of companies, includingHewlett-Packard Co.In the first year, the Springfield, Va.,company grew to about eight employees."As the years went on, we grew from eightto 10, then to 21 and then to 45, and [wegot] additional contracts," said Ikirt, aservice-disabled veteran.The small business provides projectmanagement, security and informationassurance, systems design and integration,and enterprise architecture support. Itsclients include the Defense LogisticsAgency and DISA.InformationInnovators has about120 employees andranks No. 15 on theFast 50 list. Thecompany recorded$20.4 million ingovernment revenuein 2006 for a 78.9percent compoundannual growth rate."This year, we'llprobably do about$25 million to$30 million," Ikirtsaid. "We'll probablybe somewherebetween $50 millionand $70 million by2010, and that'sconservative."During the past three years, the companyhas concentrated on solidifying its infrastructure? getting government certificationsand top-secret clearances, building anexperienced workforce and reducingturnover, and securing a presence on governmentwideacquisition contracts. Thathas helped Information Innovators go aftergovernment work as the prime contractor,he said.Six months ago, the company was one ofabout 42 veteran-owned businesses awardedspots as prime contractors on theGeneral Services Administration's VeteransTechnology Services GWAC. "It's a hugedeal," he said. "That has really made a bigdifference in this company."Information Innovators recently completeda program management and integrationcontract to relocate the TransportationDepartment to new facilities. Themove involved 5,800 employees, 6,000miles of cable, 800-plus servers, and theconstruction of two data centers and a crisismanagement center, Ikirt said."Those kinds of things over the pastthree years have really given us relationshipcredibility," he said, and have led to partnershipswith SAIC, IBM Corp., HP andCACI International Inc.When four former industry consultantsformed Guident Technologies Inc. in 1996,their plan was to provide business intelligenceand Oracle solutions to telecommunicationsand dot-com companies in theWashington area. They had no thought ofentering the government market.Last year, Guident of Herndon, Va.,recorded $7.3 million in government revenue,for a 74.5 percent compound annualgrowth rate. That was good enough torank No. 20 on the2007 Fast 50.Teddy Matheu, cofounderand a partner atGuident, said the downturnin the commercialmarket in 2001 andincreasing competitionfrom overseas promptedthe company's move intothe federal marketplace.Although the partnershad very little experiencewith federal contracting,"we figured that the governmentcould benefitfrom the best practicesof the commercialspace," he said.Guident's first successwas a small one, a software sale to EPA.The company won its first governmentservices contract soon after that, when aformer employee who was then working fora large integrator on a State Departmentcontract recommended Guident to provideOracle support for the consular affairsoffices.To increase its government business,Guident created a five-member federaladvisory board in 2004, composed of formeragency officials and private-industryexecutives. Thanks in part to the advisoryboard's advice, Matheu said, Guident's governmentclient list has grown to includeGSA, the Food and Drug Administrationand the Government Printing Office.Guident's most recent awards include a$2.5 million task order from EPA and a$1.5 million GPO contract for an Oraclefinancial services implementation. "We'vehad a busy month," said Dan Ackerman, apartner at Guident."About 50 percent of our work is in thecommercial sector and about 50 percent inthe government sector," he added, "which ispretty much where we want to stay."Guident has more than 120 employees,and Matheu envisions further growth. "Inthe last two years, we have experiencedover 100 percent growth. We're going tocontinue to expand and grow."Veronica Wilson, a Navy veteran, andDerrick Morris, an Army veteran, put asideany latent service rivalries in 2000 toestablish New Vision Engineering GroupInc., an 8(a) veteran-owned IT provider.Now, less than seven years later, NVEGhas cracked the ranks of the Fast 50 at No.36. The company recorded $3.8 million ingovernment revenue in 2006 for a 51.7 percentcompound annual growth rate.Morris said he believes much of the company'ssuccess has resulted from a decisionto rely on its core competence."When we started off, we were a myriadof services," he said. "We provided networking,Web development, Web support andthose types of things. As we started to growover the years, we really started to focus onbusiness intelligence."As veterans, Morris and Wilson alwayswanted to work with the DefenseDepartment. They gained a lasting footholdwhen NVEG won a contract from theDefense Contracting Management Agency,which remains the Falls Church, Va., company'sbiggest government customer. Thatcontract has led to more DOD work."We just finished a major contract withthe Department of the Army, where weprovided a data warehouse," Morris said,adding that NVEG has bid on anothermajor DOD contract that should be awardedsoon.About 50 percent of NVEG's contractsare a result of its 8(a) designation, he said."Having the 8(a) [designation] doesbring some attention to your company, butyou still have to be able to perform," Wilsonsaid, adding that NVEG has been the primecontractor on all the 8(a) contracts it haswon.Wilson and Morris said their 13-employee company will stay small asthey look to broaden NVEG's businessintelligence services and data warehousing."As the contracts come through, we'll staffthem," Morris said.