One of the few outsourcing companies to have specifically targeted the SME market has published a prospectus and will list on the Australian Stock Exchange in December.
Founded in 1993 as Inside Computing, the services company which renamed itself IOCOM earlier this year plans to raise $4 million through the issuing of eight million shares with a face value $0.50 each.
IOCOM's actual revenues for FY1999 were $2.232 million with estimates of revenues running at $4.711 million for 2000 and $7.588 million for 2001.
Peter Singer, IOCOM's founder and managing director, said the funds raised will give the company market capitalisation of over $8.5 million. This will be used in further marketing the business and engaging in acquisitions of smaller companies built on similar service offerings, he said.
According to Singer, the company's success is based around focusing on the IT and infrastructure service requirements of SMEs, something for which he said "there is great demand".
Singer quickly shrugged off the possibility that the float may get lost amongst the rash of other IT-related IPOs doing the rounds at the moment.
He said a lot of the interest in so-called Internet companies is based on speculation of their future earnings but before those earnings are realised there has to be an infrastructure put in place. This is exactly what IOCOM is involved in for SMEs, which form the majority of Australia's business community.
"We are not a dot-com company so we are not listing on speculation [about future earnings]," Singer said. "IOCOM is a services company that has been profitable since foundation. We have seen an opportunity to grow by supporting the Internet backbone.
"We are listing because we have a plan for the future and we needed to gain access to the equity markets in order to fulfil those business plans."
For those thinking about focusing on outsourcing for the SME market, Singer said the hot buttons at the moment driving the case for outsourcing are the shortages of quality staff, staying up to date with the latest technology and high availability.
"Effectively, we become their IT departments which gives them access to 24 x 7 service," Singer said. "Small companies just want to be able to get on with their business and not have to worry about their IT issues."