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By Lisa Schofield Photograph Courtesy iCIMS
Like most adages, “If you build it, they will come,” has a resounding ring of truth. Take the case of iCIMS, based in Hazlet. Founded in 1999 by entrepreneur Colin Day—then aged 23—this highly successful software-as-a-service (SaaS) provider came “this close” to being a failure statistic. But intelligent operations and running lean nourished the roots of the company, which has enjoyed a fruitful yield of pure profit and continued growth for three years running.
Here’s another tried-and-true adage: Opportunity knocks. Many people don’t open the door, but those who do enter a whole new world. When Day’s employer, Comrise, developed a software package it used internally for its own human resources (HR) needs, the budding entrepreneur saw HR software’s incredible potential as a basis for servicing companies all over the globe.
Software-as-a-service is a new model that’s rapidly taking off. Instead of selling expensive software as a product that inevitably becomes outdated, SaaS companies instead lease the use of the software and provide ongoing updates and support for its use. iCIMS specializes in talent platform software service, which enables full human capital management for a business of any size and in any industry.
“The old model was a business purchasing such software at a huge expense of installation,” Day explains. “The new model is treating this as a utility—we build it, host it, and support it. The business (client) simply pays us monthly.”
In 2009, Day attests, iCIMS has more than 700 clients signed up and actively using the platform. Clients range from internationally known companies such as Federal Express, Esurance, eHarmony, and Amazon.com to boutique outfits and local firms. “We are very proud of where we are today as a privately-held company that was completely organically built. We have never taken outside capital and we are growing faster than the entire SaaS industry,” reads the statement iCIMS issued upon winning the 2007 Ernst & Young’s Entrepreneur of the Year award in the information technology software category.
That distinction, among many others—including recognition as one of the top five forward-thinking innovators in Fast Company’s Fast 50 Reader Favorites—were nothing more than wishes in the wind only six years ago, when the fledgling company was on the brink of dissolution.
Day says he started the company with a psychology degree and tremendous bravado borne from the desire to make a difference; rather than be an employee, he wanted to be the one to give the young and talented their start. “I had a bright idea starting this when the dot-com collapse occurred,” Day recalls. “But that made us learn quickly. No one gave us money; we took out loans. We immediately had to lay out significant money to rebuild the initial software and build a data center before we can land a single customer. In this model, it’s not solely about the software—it is all about the service.”
Software is inanimate, service is the life force. In an SaaS business, the first customer does not pay a significant lump sum cost upfront; instead, it only pays a manageable fee per month, and all iCIMS’s costs are frontloaded. An SaaS firm must have hundreds of satisfied customers paying their monthly fees before it can get to that break-even point. Day notes, “We learned very quickly that this is all about getting to break even before we ran out of money.”
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