News Article
Naysayers Fuel Digi-Net Technologies' Growth: CEO Robert Parker inthe Hot Seat
Enterprise Florida
Techno-Preneurs Newsletter
July 14, 2003
(Gainesville, FL) -- Go ahead- dare Robert Parker and his Digi-Net [ http://test.digi-net.com ] team of 50 not to succeed. Try telling this 29-year old entrepreneur his ideas won't fly and his business model won't work. Outspend him (which isn't hard to do), out-resource him (again, not difficult) or try to upstage his technology (now things are getting a little more difficult). But whatever you do, don't take him - or Digi-Net Technologies - lightly.
In just seven years, this former University of Florida student carved out a respectable place for Digi-Net in Internet technology by focusing on software that powers electronic bulletin boards (DigiPosts™), assisted e-commerce transactions (Groopz ECommerce™) and chat rooms (DigiChat™). What started out as a one-man Internet consulting firm, is now a thriving enterprise with true A-list clients -- the National Hockey League, NBC, Boeing, and Procter & Gamble to name a few. Digi-Net now ranks as the fastest growing IT firm in Florida and the 8th fastest growing private company in Florida overall.
Because of its relatively small size, and the fact that it remains privately-held, Digi-Net Technologies isn't a household name - at least, not yet [so far, Parker has resisted offers for venture capital or an IPO]. But regardless of whether or not the public knows Digi-Net by name, one thing is certain -- the competition knows Digi-Net's products all too well.
My eFlorida News recently sat down with Robert Parker to pick his brain and discover his source of inspiration.
(My eFlorida News): You started Digi-Net as an Internet consulting firm with less than $1,000. How did you spend that initial "seed capital"?
(Robert Parker): I think the first $1,000 went toward a deposit on office space, plus the first month's rent and paint. I had a pizza/beer party to convince a bunch of my friends to help me repaint the office.
At which point did you realize the company would switch from being a part-time job to a full-time business? Was the transition intentional, or did it just evolve?
It was fully my goal when I opened Digi-Net's doors that I would go full-time with it. I realized three or four months into it that it would never be successful unless I was able to do it full-time. I hoped to generate enough income to cover the cost of business during the launch phase, but I wasn't able to do so because of the limited time I had available. Eventually, I decided to take a leap of faith and hope that if I dedicated enough time, revenue would come. Ultimately, the revenue did come, but at the time it was pretty scary.
Did you have any mentors to guide as you started the company?
I'm similar to a lot of other entrepreneurs in that I've done a significant amount of reading. I've particularly enjoyed the stories of people like Larry Ellison, Steve Jobs, (Bill) Gates, and (Steve) Ballmer. Reading those stories served as a roadmap for some of the goals I have.
In the beginning, given that you were an English major (not a computer science major), how did you get the technical skills to run a technology company?
It required a lot of research. Because I didn't have the money to hire many people, I learned how to program out of necessity. But I would never consider myself a technocrat. I'm pretty much a pure entrepreneur who understands both technology and business applications and where those two will meet five years from now. That's the space I like to play in.
What happened over the last 7 years to get Digi-Net where it is today?
Digi-Net's history is divided into two phases. At first, we started out as a technology consulting firm. We developed technology for everyone from "mom and pop" shops to Fortune 500 companies. Companies like NationsBank, Hyatt, Swissotel, and FirstMarketing asked us to implement specific pieces of technology or help integrate their ordering systems with their existing inventory system. We were able to do that.
The problem was that it was a "build once, sell once" model. No matter how much you charge for consulting, you're still building one thing, one time and the selling it one time. It's not a model that I liked because it doesn't scale. What I wanted to do was build once and sell everywhere, or sell a million times . Much more like a Novell or an Apple or a Microsoft in what we call the "shrink-wrap software industry." In 1999, we made the switch to the second phase -- developing software.
What have been the biggest growing pains for Digi-Net?
Because we're a cash flow positive company on a fast growth track, I think our biggest challenges been in managing growth without overgrowing and running out of capital. Running the business cash flow positive every quarter requires a tremendous amount of management.
We don't have the ability to have something called a "burn rate." There's no such thing at Digi-Net. Our philosophy requires vigilance at every level of management, right down to each salesperson needing to be productive and profitable. That approach has been a big reason for our success, but it's also been the reason for a few extra lines on my forehead.
Digi-Net is still a privately held company. From an entrepreneur's perspective, what are the advantages and disadvantages of staying private? The main advantage is that there's only one head honcho. I don't have to answer to an outside board or Wall Street. That allows our team to plan for ROI on a multi-year basis. We're also very, very nimble and can take advantage of opportunities when we see them.
Being private can be a disadvantage when we work with larger companies. They prefer to work with other public companies because, obviously, their financials are public and there's a greater comfort level there. However, I think we've been able to overcome much of that concern by establishing a good history with our existing clients.
Industry critics have observed that high-tech companies often fail because their founders possess brilliant technical and creative skills, but can't craft a viable business plan to save their lives. How do you find the right balance? In general, I think that there are two types of entrepreneurs. The first is the technology-based entrepreneur you mentioned, who has brilliant technical and creative skills, but lacks savvy on the business side. Then there's the other type who's more of a businessperson, or an "evangelist", who can stir a crowd with a rousing speech and sell really well, but without an understanding of the technology.
The rare breed is the kind of person that excels at both -- a visionary who's also an evangelist/salesperson. At Digi-Net, our executives and our team are capable of seeing both sides. That's really what we focus on -- having the balance between the two types.
Talk about the corporate culture of Digi-Net. What type of person does well in your culture? What type of person won't make the grade? That's pretty simple -- the people that do well are believers . We call them evangelists at our company. These are people that if you cut them open, you'd find that they live, breathe and bleed Digi-Net. The technology we develop literally changes people's lives . And the people that drive that technology -- whether they're in technology, or sales or accounting -- believe in what we do. These are the people that work until 4 in the morning, if necessary, and do so without a manager watching over them.
