Conservatism Paying Off For Surebridge

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A gradual buildout of its data center and services,rather than the massive buildout done by many now-failed ASPs and MSPs,appears to be paying off for Surebridge.

The ASP's hosted customer base doubled in 2001 to about 70 customers, and the private company's revenue increased by 50 percent over 2000.

And it is "very close" to profitability, said Pradeep Khurana, chairman and founder of Surebridge, who would not pin down a quarter but said sometime this year.

The secret to Surebridge's path to profitability is really basic business sense: Create value for the customer and control expenses, he said.

"We created a business where our costs increase incrementally as demand materialized, not with an 'if you build it they will come' model," Khurana said.

Surebridge doesn't provision bandwidth until a customer is ready to be turned on and it doesn't keep inventory on-hand, for example.

As for creating value for the customer, Khurana said the ASP model offers faster times to market and cost savings, which is particularly appealing in recessionary times.

The headaches behind software upgrades aren't hurting business either. Much of its business in 2001 came from customers that wanted to outsource Great Plains, PeopleSoft and Siebel applications rather than upgrade in-house.

"We expect this year to be pretty strong with Siebel," Khurana said. "Overall, despite what's happening in this space, I'm pretty bullish about the upcoming year and about [the ASP model."


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