ICF sets sights on larger tech contracts

ICF touts the fact that its revenue has doubled roughly every five years over the past two decades. To keep that going, however, the company says it needs to score some big federal technology contracts.

On average, ICF has roughly doubled in size every five years over the past two decades as a former private equity-backed company and one that has traded on the public markets since 2006.

So how soon does the global technology consultant repeat that for the next five years? That would mean going from the $1.475 billion-$1.5 billion in revenue it expects to post this year to around $3 billion by 2024.

Those certainly are big numbers to achieve, as ICF executives acknowledged during the company’s investor day on Dec. 3. But the way they get there is simple, at least for ICF’s federal business: pursue more longer-term contract opportunities north of $100 million.

Which means the work to move on those bids begins early, as CEO John Wasson explained.

“You have to start positioning, teaming and working these deals two or three years in advance,” Wasson said. “We’re quite skilled at capture, but we have not done it for as many, we don’t have quite the depth of experience at 100, 250, 500 million dollars, so that’s another investment we’re making to make sure we up our game on that.”

Wasson in October succeeded Sudhakar Kesavan, ICF’s chief executive of the past 20 years, who remains chairman of the board.

The $100 million-opportunity threshold previously mentioned is not limited to the federal market. Contracts of at least that value are also coming out in some highly-regulated commercial segments ICF has significant footprints in. Think energy, health care and others.

But in the federal market, the notion of scale is especially pronounced as many contracts for technology-related jobs are getting larger, longer in duration and more complex.

As Wasson pointed out, agencies are wanting to move from legacy IT platforms to new environments with cloud computing as a core piece of that shift.

Which means ICF, “absolutely needs to win larger implementation contracts in the technology and engagement front and they’re out there, both in civilian and defense,” Wasson said.

“We have a suite of capabilities where we’re able to go after opportunities now. Certainly from the digital side we have some scale. We’ve effectively competed in cyber in very specific markets on the technology side. We do have some next-gen IT. I think there we need more and deeper scale,” he said.

That leads to the second tool of growth Fairfax, Virginia-based ICF has at its disposal. On the corporate website, ICF lists 16 acquisitions it has made since 2002 across both public sector and commercial businesses given the company’s strategy to see those sides as far from separate.

Wasson characterized ICF’s past 20 years as seeing half of its growth organically and half through acquisitions to bring in additional service offerings and customer sets the company is not in already. Then there is the matter of what to do as the company builds its scale, particularly in the next-generation IT and technology engagement areas.

“The model is then finding opportunities in the civilian space where they need to implement these larger technology platforms," he said. "We will be able to use the same strategy where we leverage our domain expertise, there’s the architecting and putting those platforms in a way that helps them carry out their missions. That high-level strategy I think will help us on these kinds of deals.”

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