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With a new CEO bringing a strong vision
and approach to sales coupled with a long history in content management solutions,
Infodata is moving forward
Technology
Information Management
(OTC: INFD)
Infodata Systems Inc.
12150 Monument Drive
Fairfax, VA 22033
Phone: 800-934-5205
Edwin
Miller
President and
Chief Executive Officer
Interview conducted by:
Lynn Fosse
Editor
CEOCFOinterviews.com
April 2003
BIO:
Edwin Miller, President & CEO
As President & CEO, Edwin has strong business and
technology experience provides overall visionary leadership to Infodata. His
qualifications include developing successful teams in enterprise software organizations,
providing strategic planning, business modeling, establishing partner alliances, and
raising venture capital financing. Mr. Miller was most recently President and CEO of
Ikimbo, a B2B enterprise software company. Previous roles included President & COO of
XML Solutions, Managing Director for iSage Capital, Co-founder and Vice President of sales
and marketing for Conducent and Director of sales and marketing at PSINet.
Company Profile:
Infodata Systems Inc. (OTC: INFD), provides enterprise software and integration solutions
that allow regulated businesses and controlled government agencies to manage the full life
cycle of content. The Company delivers a software services layer around Enterprise Content
Management (ECM) solutions to provide enhanced content review, content assembly and
publishing, content transformation, content security and content analytics capabilities.
Infodata partners with the highest
caliber companies to ensure our solutions utilize the best technology and solve real
business and organizational problems. Our products integrate with leading edge
environments from Adobe and Documentum and are geared to accelerate all facets of the
content management life cycle processes.
Infodata offers professional services that extend and compliment our offerings and enable
satisfaction of specific business processes. For regulated businesses, Infodata has
been extremely successful in designing and building systems for the Pharmaceutical
industry to assist them in their compliance efforts with 21 CFR. We will continue to
deliver solutions to other regulated activities such as Department of Defense 5015.2,
which outlines the standard for the Federal Government in dealing with records management
(both secure and non-secure documents). For the private sector, Infodata will
concentrate on standards (such as ISO-9000) where compliance activities for customers are
significant.
Proprietary Products
Infodata offers the following suite of
products: AnnoDoc, Compose, and Signet.
AnnoDoc offers enterprise-wide collaboration by providing seamless, secure integration
between Adobe Acrobat’s annotation tools and a content repository. Users anywhere in
the world have the ability to mark-up and annotate documents through a Web browser and
save the annotations as a separate file.
Compose is an Adobe Acrobat plug-in that automates
and streamlines document production tasks such as the creation of tables of contents,
hyperlinks, document indexes and other document navigation features.
Infodata Foundation Server
has evolved out of the AnnoDoc product. AnnoDoc is a multi-tier product that
provides advanced annotation support and integration between Documentum and Adobe Acrobat.
The creation of a separate product for the server centralizes and standardizes
several of the core components of AnnoDoc and other Infodata products.
e-Hub provides rapid and tangible
return on investment by converting test results into useable PDF renditions.
Signet is an off-the-shelf security solution for
information publishers who want to ensure that only authorized users are able to read
their PDF documents. Signet is ideal for publishers who want to exercise a high degree of
control over a document's use, including when it will expire and under what circumstances.
CEOCFOinterviews: Mr.
Miller, what attracted you to Infodata Systems?
Mr. Miller: “In
March of this year, Infodata will be thirty-five years old. The company is built on years
of experience in designing content management solutions. A tenured and experienced board
also backs the company. Those facts alone presented a tremendous opportunity for me.
However, more important to me was the commitment and drive of the people at the company.
Everyone here senses the tremendous opportunity we have to take our experience and
products and refine ourselves into a company that offers innovative solutions for
today’s business problems. Right now, most business processes around content
management workflow are manual. What we offer is the ability to automate workflow
processes around content review, content assembly & publishing, content security,
content transformation, and content analytics. Our solution offering of products and
services is already getting traction in the marketplace, and we are all united in
perfecting these offerings to our customers. All of this attracted me to Infodata.”
CEOCFOinterviews: What
is the focus of your new management team?
Mr. Miller: “Our
primary focus is on fine tuning the company business plan to accentuate our discriminators
in the ECM market and executing to plan. Infodata offers significant value to existing
content management solutions by augmenting functional areas that deal with content life
cycle activities. We deliver functionality within the ECM environment that is currently
missing and is of high value to people who are responsible on a day-to-day basis for
creating, modifying, assembling, reviewing, approving, and publishing content. Our focus
for this year is to build and offer solutions that do exactly what our customers need.
Getting this message out is our focus. So far, it is resonating extremely well, and we are
solidifying future work with each of the partners and customers. Our other main
focus is on sustaining and increasing profitability, which translates to improved
shareholder value.
CEOCFOinterviews: Is it
the case that most companies don’t realize what they need when they first start with
ECM systems?
Mr. Miller: “No, I
don’t believe that is exactly the case. The big solution providers like Documentum,
Inc. (NASD: DCTM) and Oracle Corporation (NASD: ORCL) deliver solid, robust content
management solutions that support a large range of customers across many different
verticals. Their solutions have made a significant impact in how companies manage their
content. But what is needed now is functionality that targets the particular pain points
by vertical – solutions that go deep. For example, if you are a regulated business,
like the pharmaceutical industry, compliance and global-collaboration are extremely
important. Infodata is a vertical market player; we play in the pharmaceutical space and
we play in the highly regulated areas of the federal government and the intelligence
community. Our particular skill is to go in and extend the value of Documentum with
additional life cycle functionality that improves the workflow. Customers typically know
exactly what they need to do and what they need is someone to come in and make it work
that way.”
CEOCFOinterviews: What
is different in the approach that you are now taking?
Mr. Miller: “As I
have stated, Infodata has all the right elements and we are uniting them to offer the
right solutions for this market. We believe that the value of ECM systems is not just the
system itself but rather the implementation of solutions around the content review,
content assembly and publishing, content security, and content analytics as it relates to
fulfilling regulated activities. We know that companies need more than just to establish
controlled processes, they need to build efficiency around the review, assembling and
publishing, and security of content in order to better compete. It is for reasons like
these that CIO’s across the Globe are quickly moving to implement content management
software and looking to Infodata for delivering value added solutions. Our approach is to
meet these needs and provide a complete solution.”
CEOCFOinterviews: What
is the revenue model?
Mr. Miller: “We
license the software and provide annual maintenance and support for a fee. Part of the
software is sold on a client basis, and part of it is sold on a client end-server basis.
We also sell services integration where we will assess the size, scope and requirements of
the work and write a proposal. It could be a fixed fee contract, or a time and materials
contract. We are a solutions vendor who integrates our tools and our partner’s tools
like Documentum and Oracle.”
CEOCFOinterviews: How is
the current environment of technology affecting Infodata, and can you get around it?
Mr. Miller: “Less
money is being spent on leading-edge technologies but not necessarily technologies that
affect business processes. Sales in the content management market have not declined as
drastically as other areas, like EAI (??) for example, and that is because everyone has
documents and records that must be managed and regulated. Therefore, when companies
believe they can spend a certain amount of money to purchase solutions that truly improve
their processes, they will do it. We feel confident about our approach to sales because we
are not selling a generic platform, but specific solutions that augment a workflow around
a specific problem. We can show CIOs how we can improve an environment and pinpoint
exactly how we can help them save or make money.”
CEOCFOinterviews: What
are your customer areas and in your meetings with them, what have you gathered are their
impressions of Infodata Systems?
Mr. Miller: “We do business with the federal government,
pharmaceuticals, and financial companies. We also have an intelligence division. Our
customer base is loyal and extremely happy with us. We just initiated a new project with
an old customer, a legislative bureau, and the immense amount of respect they have for
Infodata and several of our long-term employees was apparent.”
CEOCFOinterviews: When
Infodata puts in a system, how much customer service is there once they are running your
software?
Mr. Miller: “We
have a service call-center group, which is basically a support line. Most of the time we
install software, it runs and it does not need maintenance. We consistently do a good job
of architecting solutions that are scaleable, reliable and secure. When the need does
arise, we will do support on-site but our goal is always to migrate the system to be under
our customer’s control completely.”
CEOCFOinterviews: Do you
have competition, and why are your products better than the others are?
Mr. Miller: "Competitively speaking, this is a large
space and consolidations have started to occur. For example, Documentum bought E-ROOM and
BULLDOG. Oracle and Microsoft Corporation (NASD: MSFT) continue to acquire companies.
Therefore, the ECM marketplace is moving toward consolidation at that layer in the stack.
I think the layer in the stack that they are consolidating is right above the repository
itself, so if you think of SQL as being the repository, the layer above that would give
you workflow, visibility or archiving. The four layers above that are software, and that
is why I think it is a wide-open field. You can do some unique deliveries that augment a
set of tools from the lower layer, and not be touched by Microsoft or Oracle because it's
just not their business.
Competitively, I break out business process management, EAI, web content management,
integrated document management, and knowledge management. We are watching the players and
who's buying what and who's partnering with whomever in their spaces. We don't foresee any
troubling trends. The one thing that could affect the company is if a major partner gets
acquired. However, we have been doing business with our customers in the federal
government, intelligence community and pharmaceutical industry for years. I am not worried
about somebody coming and taking the contract because we are capable and will always
deliver on what we say we can within the solutions environment."
CEOCFOinterviews: What
can you do about it?
Mr. Miller: “More
partnerships would alleviate my risk to one player, such as partnering with BEA Systems,
Inc. (NASD: BEAS), Oracle, and Documentum. But you can weaken your relative importance to
any one of those players and you become less of an expert around a system and when they
sign a new customer, you don’t get the call to go help do the integration work and
get the opportunity to layer on your vertical market applications. There is always a risk
reward, but I think the way we alleviate that risk is partnerships and building a stronger
tie with the company that could be acquired, so if they are acquired, we are part of the
strategic value that drives the acquisition.
CEOCFOinterviews: Tell
us me a little about the cash and credit position of Infodata?
Mr. Miller:
“I’m restricted about how much I can tell you regarding our 2002 4th
quarter and year, as we won’t announce our results for another week As of
our last 10-Q filed in September, we had about 1.0 million in cash and cash equivalents,
and we have a credit facility with Commerce Funding Corporation. If you looked at
the 2002 SEC filings you would see that the product division and government division did
very well. The intelligence division didn’t fare so well because a big contract was
terminated for convenience. However, our intelligence customers have great respect for us,
and we have five projects in progress right now. Our Revenue run rate is between 8 and 9
million dollar.. I would like to see that increase over the year, however there is a lot
of risk in doing that. It was profitable the past few quarters and our goal is to grow net
revenue and maintain a good net income number.”
CEOCFOinterviews: How
much work do you need to do to maintain your product and deal with innovations?
Mr. Miller: “With a
company that is thirty-five years old, you can imagine we have a lot of products that have
been developed over the years. This company was selling mainframe software twenty years
ago, and even has some mainframe revenue today. It is small and declining rapidly, but it
is still there. Coming into the 1990s there were twenty products in this company, with
some of them coming through acquisitions. Today, we have a robust product family
that is tailored to the needs of the content management environment, and are further
refined for vertical application. Our products are built upon strict industry
development standards that make them enterprise ready (scalable, reliable, etc.) and thus
easy to maintain. As for innovation, we have so much knowledge about document and
content management in this company that I feel confident in taking the substance of this
team, walking in to any customer and demonstrating to them that we can easily solve their
most difficult content problems as it relates to Content Review, Content Assembly &
Publishing, and Content Security. That is the real power of this company.”
CEOCFOinterviews: I
would think now with the dot.com and the technology drop that the experienced people would
be more important than ever!
Mr. Miller: “That
is exactly correct! In this up and down market, who you do business with is critically
important. Infodata brings experience and wisdom to our work and to how we operate on a
daily basis. We have employees who have been here for 20 years. We also have executives
who were Colonels in the military for twenty years doing document management. All of this
adds up to offer tremendous value to our customers who want to work with stable,
technically proficient companies.
CEOCFOinterviews: I
would imagine the amount of regulation the companies need would be a big factor for you.
Mr. Miller: “We
understand the regulated community. Regulatory compliance is mandated in many vertical
markets and is a major aspect across all lines of business where Infodata is focused.
Typically, the highest degree of concern for most companies is the content management
activities surrounding controlled or regulated information. For example, due to the
tightening of regulations by the SEC, it will no longer be acceptable to have financial
documents spread across the enterprise. The recently enacted Sarbanes-Oxley bill is
pushing many public companies to implement ECM systems in order to centralize and
structure the flow of reporting documents. Our solutions target these needs efficiently
and completely.
CEOCFOinterviews: In
closing, tell us why investors should be interested in Infodata?
Mr. Miller:
“Through more than thirty years of experience, I believe the Company has a superior
comprehension of what "content management" means to a customer, but in recent
years hasn’t had the vision or management team to execute.
An investor should possess a long-term view of the
Company's stock. I’ve recently added key senior executives to the management team to
enhance the existing team at Infodata. We have recruited a new leader of sales and
marketing that has a GE (General Electric Company - NYSE: GE), Ericsson (NASD: ERICY)
background. Additionally, he has several years of experience in turning and growing
a business. The Company's CTO has an accomplished background with twenty plus years
experience in content and document management, and he has a graduate degree in
architecture studies from Harvard. We also have a new CFO who has managed both a NYSE
company and a NASDAQ company at the CFO level, and has a strong financial, operational,
and managerial background, as well as M&A experience. What we are building for the
future is a solid approach to selling and delivering our solutions that include both
products and services around content management. We are organizing the functions of the
organization at the executive level that are needed to deliver to the customer and build
shareholder value, our top priorities.”
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