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San Diego's FASTEST Growing Privately Held Companies: Trans-West Network Solutions, Telecom Company Narrows Long-Distance Gap

Posted on: Monday, 25 October 2004, 02:00 CDT

The diagram in Michael Promotico's office squeezes the continental United States into the frame of a whiteboard.

That's the goal of Trans-West Network Solutions. The company, which sells and configures telecom equipment, makes far-flung distances seem close.

Trans-West does it for big clients such as Charlotte Russe Holding, Inc., providing the San Diego-based apparel retailer with a phone system that allows four-digit dialing between widely spaced locations.

Customers get as big as Petco Animal Supplies, San Jose State University and the San Diego Unified School District.

Trans-West sells equipment from several vendors, though 95 percent of the gear comes from Ottawa-based Mitel Networks Corp. "We're the largest reseller of Mitel in the country," said Promotico, TransWest's president.

Wrapped into those sales is engineering work, plus round-the- clock and round-the-calendar technical support.

"You can't just sell phone boxes anymore," said Promotico.

"You have to integrate them into networks," said Darryl Sopata, the company's vice president for business development.

Connecting Cities

The whiteboard in Promotico's office shows a telephone network for San Diego-based Accredited Home Lenders, Inc. The network rides piggyback on the Internet, connecting about a dozen major U.S. cities.

Trans-West works in a technology called voice-over-Internet protocol. It's the art of sending telephone traffic over the Internet, instead of through the traditional, circuitswitched telephone network.

The technology, nicknamed "VOIP" or "voice over IP," is so disruptive that traditional telecom companies are beginning to sell voice-over-IP services.

Trans-West Network Solutions owes its heritage and much of its success to two entities: an Arizona company of the same name, and in a San Diego company that merged out of existence in 2000.

The local company was INET Inc. (pronounced EYE-net), a -telecom interconnect company founded in 1985. Promotico was one of three original people in the business, where he specialized in engineering and sales.

By 2000, INET had grown to 110 employees and had side businesses involving Cisco routers and Internet service. INET attracted the interest of Stockton-based Pac-West Telecomm, which bought the company in the first quarter for $14 million.

Making Changes Pac-West executives wanted to sell equipment and T1 trunk lines as a bundled service, Promotico recalled. However, the economy changed, and so did the Stockton company's business plan. Within 18 months, Pac-West wanted to divest itself of businesses such as INET.

Promotico had a decision to make. "I could have stayed with PacWest. I could have stayed in Stockton," he said.

Instead he decided to go into business with an old friend and competitor, Herbert C. Rosen of Phoenix.

"We used to be golf buddies," Promotico said. Rosen recalled seeing opportunity in Southern California, with the telecom scene changing and Pac-West retrenching. There was also the chance to work with Promotico, who knew the territory and customers.

Said Rosen, "it was something that was pure timing."

Today, Rosen retains complete ownership of Trans-West Network Solutions in Arizona. That business dates back to 1981.

Tremendous Growth

Trans-West the California corporation is a 50-50 partnership of Promotico and Rosen. It was born in 2001. And it's the California corporation that became the third-fastest-growing private company in San Diego County on The List, with 1,194 percent revenue growth between 2001 and 2003.

Early on, the business felt the sting of the Sept. 11, 2001, attacks.

The terrorist strikes on U.S. soil "basically cut sales in half," Promotico said. "Companies didn't want to make capital asset purchases."

"It put everything on hold for four months," Sopata said.

Revenue from California operations was $513,000 in fiscal 2001, but it picked up quickly. It was $5.2 million in fiscal 2002 and $6.6 million in fiscal 2003. "This year we're tracking $9 million," Promotico said.

EvVolving Business

A recent acquisition - EvVolv Technologies - will add $2 million to revenue next year, Promotico said.

The company bought Encinitas-based EvVolv on June 1 for an undisclosed sum. EvVolv was a Mitel dealer with strong sales in the San Francisco Bay Area.

Today, the company has offices in San Diego, Brea, San Francisco and Tijuana. "Maquiladora business has been pretty steady," Promotico said.

There is also the Phoenix office, which handles functions such as accounting, purchasing and human resources for the California corporation.

Trans-West also sells products from Toshiba, Ultrak, inter-Tel and March Networks. Promotico said such companies typically take their gear to market through value-added resellers. Cisco and its resellers are rivals.

In addition to business telephone systems - with sophisticated features such as text-to-speech translation - Trans-West sells and services data systems and video-surveillance systems. Surveillance customers include banks and four San Diego County casinos. Some customers go back to the days of Pac-West or even further back to the days of INET.

Customer Is King

Trans-West executives say customer service is a big part of their success. "We treat the customers like they're the only ones," Promotico said. "We work very hard to establish a good relationship with people," said Sopata. "We fill all key positions with good support, people."

Looking ahead, Trans-West may have a paradoxical opportunity. That's the ability to profit from corporations' decisions to place their call centers in the Far East.

One client, who the executives won't name, is looking very seriously at setting up call centers in places such as India, Sri Lanka, Thailand and Malaysia. Australia is also a possibility. That client also plans to rent buildings and modular furniture. In turn, he would become a onestop outsourcing shop to American corporations, leasing out the real estate and electronics as a bundle.

If the deal goes as planned, Trans-West would provide Mitel equipment for the venture, and manage the bandwidth between those faraway sites and the continental United States.

Copyright San Diego Business Journal Oct 04, 2004

Source: San Diego Business Journal

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