Patience Pays Off : Tech Consultants Take Long View

When brothers Kevin and Ivan Nikkhoo founded Vertex Systems Inc., they made strategic short-term sacrifices such as refusing outside funding and turning down potential clients that weren’t within the company’s area of expertise. Now the Los Angeles technology consulting firm says it is enjoying the long-term benefits of those early decisions. Ivan Nikkhoo was interviewed by Karen Kaplan.

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When Kevin and I started Vertex Systems Inc., we took a full year to come up with a business plan and decide what markets to address. We were working 90 to 100 hours a week and we weren’t generating any income yet. But by the time we were up and running, we knew exactly what we wanted to do: specialize in design and implementation of computer network infrastructures.

Both Kevin and I are software engineers, and we decided we wanted to focus on the leading-edge technologies. Since the rate of change in this industry is so high, we’re in a learning mode all of the time. That means we’ve had to spend a lot of time and money on training so we can stay ahead of the curve.

Kevin and I started this company with less than $100,000 in personal savings. We considered getting a loan, but we didn’t want to have to answer to anyone. For example, a bank could have pushed us to take on clients that we weren’t interested in in order to produce short-term income. We don’t want our growth to be dictated by anyone else--that’s why we started our own company in the first place.

We are very focused on our business plan, and we stick to our core competencies. We have to say no to a lot of potential clients if they want us to do work that is outside of our areas of expertise. Even in the beginning, we turned down projects that didn’t make sense for our company.

There’s a lot of business that comes our way that we just have to say no to in order to stay focused. Saying yes would detract from our core competencies, and our employees would fall behind in the areas that we really care about.

When we’re competing against another company and the client sees that we’re so highly specialized, they know that we can provide them with more value than our competitors. We have invested more to keep up with changing technology, and they know that.

We don’t hire junior staff or people who are fresh out of college with no experience. We bring in experienced talent, and we are willing to pay for it. A lot of our employees have been hired away from other companies, and that costs a lot. But we think it’s worth it.

Not having to make loan payments has also really helped our company grow. We put our money into personnel and training and technology resources instead. We’re investing for the future. We’re long-term players, and everything we do has to add value to our company as well as to our customers.

We derive a lot of personal satisfaction from building a successful company and leaving our competitors in the dust. That satisfaction is part of the payoff.

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AT A GLANCE

Owners: Kevin and Ivan Nikkhoo

Nature of business: Technology consulting firm

Location: Los Angeles

Year founded: 1992

Number of employees: 5

Annual sales: Expecting $5.5 million this year