The televisions in Tim Jones' office are rather unique. They aren't three-dimensional -- or even high definition. They're bulletproof. Jones explains that a special design protects the screens from AK-47 gunfire.
This is important, for this technology is dropped into hostile territories in the
Middle East for top-secret operations. “I can only speculate on what Special Ops uses it for,” Jones says.
Jones' firm, the Cybrix Group, secured a contract from the government to test the technology at its Tampa Bay compound — the location of which is also secret.
The Department of Defense's contracts with Cybrix propelled the veteran-owned small business to the Inc 500 list of the fastest-growing companies with three-year growth of more than 3,000%; the Tampa-headquartered IT firm recorded revenues of roughly $575,000 and employed four in 2007. In 2010 revenues reached $22.2 million and the firm employed 24.
The recent growth trend is surprising for a firm that was bleeding out in 2006.
Jones started Cybrix in 2003, two years after he sold his first IT business, ACE Technologies, for an undisclosed amount. This sale provided capital for Jones' next endeavor: development of an algorithm that encrypts data he saw being developed in Japan.
The result was a failure.
“The cost was just not feasible, and there were too many bureaucratic hurdles,” Jones says.
Cybrix invested $400,000 into the failed project. Says Jones: “It was just a bloodbath.”
Though Cybrix devoted much of its resources to the doomed encryption software, Jones and his then-small team of veteran colleagues began making connections around MacDill Air Force Base. The networking landed small IT consulting projects for companies like Chinega and IBM, who had contracts to do work for the Department of Defense.
Contracts with companies working with Central Command and Special Forces became the firm's focus. Jones proudly says that at one time General Dynamics, a Tampa firm with roughly $32 billion in 2010 revenues, was a sub-contractor of the local, small business.
“We needed to get back to what we know,” Jones says of his firm's IT work with the Department of Defense.
After Cybrix repositioned itself into defense contracting, which involves testing products for military use or IT consulting, contracts increased and growth was almost exponential.
However, Jones and Cybrix COO and CFO Keith Vassolotti don't count on this trend to continue — they even forecast a 40% drop in revenues for this year.
“There's too much uncertainty because of the debt,” Jones says of federal spending.
The shifting nature of the conflict in the Middle East will require more work and more technology from the U.S. Special Forces. One may think Jones would be ecstatic about the branch of the military Cybrix works with most expanding operations. But he says that other defense contracting firms see the same trend and are flooding the market. “We work in a niche that's about to get very competitive,” he says.
Cybrix needs to shift its focus once again, so Jones has the firm poised to step into the commercial sector with software development.
Vassolotti's commercial background is the reason Cybrix tapped him in 2010. Previously, the University of Tampa M.B.A. was CFO of Ceridian, a Minnesota-based human resources firm.
Diversification into the commercial side will be a change of mindset as well as a change of culture for the company. For example: “We don't take government holidays off,” Jones says. “You can't do that working in the private sector.”
The new strategy has not been a holiday so far; Jones says the expected $6.2 million drop in revenues in 2011 is only a temporary dip while the company reboots to release its new software in November.
The last time Cybrix changed direction it hit unprecedented growth, and Jones expects the same results this time. “We're positive our software will succeed,” he says. “By the end of next year we'll be back at our peak.”