Pipeline Q&A: NetCracker (cont'd)

Pipeline: NetCracker is going through a major expansion and has been uncharacteristically vocal about it. Can you describe what the end goals of this expansion are? Is there an IPO in your future?

Feinberg: There is a significant demand for our solutions to fill a void in the industry. We feel we're the only company that can fill that void successfully. So, ramping up to have the bandwidth to satisfy that demand is our biggest challenge today.

We do not believe in over-committing ourselves. We believe in long term, meaningful relationships with large customers that generate long term recurring revenue for the company. We aren't running around trying to grab every $300,000 OSS deal out there. We have been criticized sometimes for not growing as fast as we can – our revenue base can support faster growth as can the demand for our solution – but we are very cautious about over-committing ourselves. All it takes is one failed implementation with one big customer and you take a giant step back, and we will not have that.

An IPO is not something that we're planning right now, though I believe today we have the best looking balance sheet and income statement in the industry. We have bootstrapped the company from the beginning and have always been profitable. A lot of companies spend a lot of time responding to investors, and that can take away from the time you spend taking care of customers. We want to make sure we have a global practice dedicated to our customers before we think about diverting that attention to public investors.

Pipeline: Given how many OSS vendors have come and gone in recent years, what do you think is the long term model for success?

Feinberg: I'll reiterate that it's about an OSS vendor that has the technology, team, responsibility and accountability to deliver a strong solution to the customer. We've been consistently building this company around that vision. We believe it's a recipe for success, and it's why NetCracker has a reputation among our customers as a trusted partner.

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