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Schaumburg, Ill.-Based Firm's Products Provide Software, Network Monitors

Posted on: Monday, 9 August 2004, 06:00 CDT

Aug. 8--CHAMPAIGN, Ill. -- Now more than ever, companies depend on software running smoothly and computer networks operating efficiently.

Trouble is, they don't always do so.

That's where NEXVU Technologies comes in. The Schaumburg-based company offers monitoring and analysis tools to help catch those problems before they create bigger headaches.

The company, founded in 2002, relies on an eight-person software development office in Champaign to come up with its products.

NEXVU specializes in "applications performance management," an up-and-coming niche in the information technology (IT) market.

"We're in the area of helping IT organizations, providing tools that allow them to understand how their software is performing," said Rory Herriman, the company's chief technology officer. "Does it work? How well is it working? Is it doing what it's expected to do?"

The company's flagship product, NEXVU Application Performance Analyzer, can be used to monitor the efficiency of supply chain management systems and other applications that form "the backbone" of a company, Herriman said.

The tool can spot signs of slow or inconsistent response time, as well as quality problems.

"It could be the problem is with the software itself or the systems environment the software executes in," he said.

"Within the IT industry, application performance management is one of the fast-growing segments," Herriman said. "It's not a huge industry in its own right, but it's becoming that."

So far, NEXVU is very much in the start-up phase. Its holding company, Capital Growth Systems Inc., identifies itself in Securities & Exchange Commission filings as "a developmental stage enterprise."

From Feb. 28, 2002, to March 31, 2004, the company reported a net loss of $4.8 million and total revenue of $88,360.

But Herriman is taking the long view.

"Our short-term priorities are ensuring we get market presence ... and the establishment of ourselves as a player in the industry," he said. "Following that, we'll look to introduce additional products."

NEXVU's genesis occurred in Champaign.

"We actually started the company in the early spring of 2002," Herriman said. "We originated the first office in Champaign, and we did so largely because of the availability of educated resources."

The software development center, at 2009 Fox Drive, C, is overseen by Mark Scott, NEXVU's director of software development. Another founding member, Rob Eden, is principal architect and lead engineer.

Herriman said the company plans to keep its development center in Champaign, even though it's about 150 miles from Schaumburg.

"There is a great amount of (software) talent in Chicago, but there's also a great amount of competition for that talent," he said. "In Champaign, there's a great pool of talent and a lot less competition for that talent."

The company started with a venture capitalist and grew to include other investors. Herriman joined the company in May 2002, after serving as an information technology executive for Sears Roebuck & Co.

"I joined the company really to pursue my entrepreneurial desires and create opportunity within the space," he said. "It was a small, young start-up that was moldable. It wasn't set up on a defined course, but was looking for a course to be set."

The company hired its president, Scott Allen, in June 2003. He previously worked seven years for Network Associates, eventually becoming vice president of product management for its Sniffer Technologies division.

Rounding out the management team is Robert Geras, a longtime venture investor who serves as secretary, treasurer and chairman of the board.

Herriman said several companies populate the application performance management segment, but a major one is Mercury Interactive, a 15-year-old company based in Mountain View, Calif.

NEXVU believes several advantages can help it establish itself in that market.

"Our number-one advantage is price performance," Herriman said. "The ongoing cost of owning our product is substantially less than competitors' (products)."

A related advantage is the comparatively short time it takes for customers to get a return on their investment, he said.

In January, NEXVU Technologies was acquired by Capital Growth Systems Inc., a publicly listed but not publicly traded holding company based in Florida. NEXVU is its only business operation.

"What it (Capital Growth Systems Inc.) did was give us a vehicle for public introduction to the stock, without having to go through the challenges of an IPO (initial public offering)," Herriman said.

NEXVU offers sales and services nationally but has yet to pursue international sales, Herriman said.

Its clients "range from the Fortune 50 all the way to the bottom end of the Fortune 2000," he said. The clients include service providers, retailers and direct delivery organizations.

Scott, the software development director, distinguished NEXVU's products from others on the market.

"Companies have tools to tell when the network is down or up, but our tools monitor the performance of the actual application," he said. "If the Oracle database is down, our products actually monitor the performance of the application itself. If things slow down or get sluggish or end up going to a different WAN (wide area network) route, companies can use our product to tell that ahead of time. It's intended to be proactive."

Sometimes when a problem arises at a company, the network people claim it's an applications problem, while the applications people say it's a network problem, said Sharon Coughlin, NEXVU's director of corporate marketing.

"Hopefully, our product will eliminate the finger-pointing," she said.

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