Educated Acceptance

It took Novusolutions four years to start building a client base in the education industry. Now, this green-tinted technology company is taking on the other 95% of their market.

After selling their first joint venture technology company to Michael Milken in the late 1990s, Jay Vickers and John Kercher decided to give small business ownership another go at the end of 2000.

While the company is successful now, the timing of that decision was rugged.

“If that wasn't the absolute worst time to start a business, then we couldn't have missed it by more than five minutes,” Vickers says.

But after nine years of positive growth, and with an eye on double-digit growth during recession-dominated 2009, Novusolutions isn't looking back anymore.

Novusolutions aims to reduce costs for its clients through the use of custom-developed software that takes workflows online. On top of the savings in materials to clients, the company's software is built to streamline the customer's day-to-day activities.

Better efficiency yields more savings.

The company's business is driven by two products: NovusAGENDA, designed to simplify the necessary steps before any meeting takes place, and NovusHR, an online applicant-tracking system created to make hiring easier and, perhaps more importantly, cheaper.

For school boards and schools — being government organizations — the number of multi-step processes that burn through reams upon reams of paper provide Novusolutions with the perfect opportunity to prove how it can save money for a client.

And the timing of the economic downturn is actually in the company's favor in the education industry.

With property values plummeting the past two to three years, school revenues have also been sharply declining. School boards are loathe to eliminate teachers until there is no other choice, and Novusolutions has been able to step in and provide an avenue of cost savings before having to cut positions.

The economic climate and accompanying declining revenues has forced the company's school clients to shift their focus to something they haven't really had to until recently, says Vickers. In his words: “It comes down to ROI.”

While schools used to focus on how much they were spending, the products Novusolutions is providing them some tools for shifting to what they could be saving.

According to Vickers, “Our clients can make money within six months.”

Public benefit

Building a business around products that appeal to public clients seeking to cut costs has stabilized growth for Novusolutions, and that's particularly helpful in today's market. Vickers even called the company's third quarter from this year “excellent.”

But working in the public sector comes with its own challenges. easy. For Novusolutions, the question of how to break into the market challenged the company for years.

“They always ask: have you done any work for the city? Then, what about the county? What about the state?” says Kercher.

Without those references, it is slow going to gain acceptance.

It took them a few years to get into government circles, but the company now considers itself well established among public sector clients. And not just colleges, universities, and school boards, but also city and county governments. From Bellevue, Wash., to Charlotte County, Fla., business is growing.

With 95% of the market left to penetrate, the growth ceiling is set high.

And while the company's early difficulties in establishing a client base were painful, they're a huge plus now.

“The barriers to entry are high for competition in this sector,” Kercher says. That's bad news for start-ups on the outside looking in, but great news for a company with 95% market share available for future business. With thousands of potential customers across the country, Kercher says, “There's a lot of growth potential.”

While the barrier to entry is high, it has been breached by others who compete with Novusolutions.

Vickers admits that there are two or three “very good” ones out there. The key to staying competitive, though, is continuing to provide clients with a “very high return on investment for our product,” he says.

Sales is only one portion of the company's business now, as maintaining client relationships with support has grown. As a software company, Novusolutions also earns revenue from product upkeep. Having built a base of nearly 200 customers nationwide, the company now earns roughly a third of its revenues from software maintenance tasks, according to Vickers.

That provides the company with a continual, more stable revenue stream beyond sales.

Why not education?
Novusolutions has succeeded by doing business in the public sector. But that wasn't always the plan.

Vickers said the company “stumbled on” government and education markets early on when trying to sell their product to whoever would listen.

Now, with so much political chatter about “going green,” it seems as though the company's in exactly the right place.

Novusolutions has been environmentally friendly from the start. At the company's website, there's even a “Green” tab.

“We have been a 'green' company since before 'green' was golden,” Kercher says. There's even a photo of him with his bike, which is how he gets to work every day despite living in Weston.

But Kercher also points out that the green tint is not so much a cause as it is an effect. “Early on we never looked at our business as a green business but more a practical common sense business,” he says.

Vickers agrees, stating that the cost savings clients realize in going paperless is just the “tip of the iceberg” in terms of what the company can do for its clients.

As Novusolutions continues to grow its business, keeping focused on the right cause-and-effect will be necessary for their success.