A public digital marketing and technology services business was poised for growth again after losing almost half its revenue in less than a year during the dot-com crash. The company added two complementary businesses to their legacy service and began to grow rapidly. As they grew, their infrastructure, including accounting and information systems, became inadequate for the higher volume, reporting and analytics requirements. Staff in the finance/accounting functions was capable, but there was not enough depth in those departments to support continued expansion of the business.
The company needed to upgrade key systems that were necessary to support its rapid growth, including the accounting system, billing system, analytics platform and support systems. The company’s CFO, now a NextLevel executive, determined an accounting package to implement that would handle their growth almost indefinitely. He had previously helped determine staff cuts and other cost reductions needed to keep the company afloat when business bottomed out. Now in growth mode, he had an instrumental role in deciding which positions to add, approving several key middle-management staff to the financial organization. This supplemented or replaced more senior staff that didn’t have the depth to support the more complex accounting and data environment, and was a critical part of the scaling operation of the department. He also had a major voice in deciding which capital and strategic investments to make, ensuring that all businesses, particularly the two new ones, had the necessary capital to ensure their ability to exploit growth opportunities.
- The company’s revenues grew by a compound annual growth rate of about 60 percent during its rapid ramp-up
- The organizational changes and system upgrades were able to support and contribute to that growth
- The company’s net income grew from a loss of $4.5 million to a profit of $54 million over a four-year period
- The company’s stock price increased dramatically, and the company became one of the strongest growth stocks on the U.S. exchanges