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Blazing a Trail

C2C Systems, a Reading, England-based company with an American subsidiary based in Springfield, recently added NASA to its client list. The space administration was looking for help trying to track a flow of E-mails among engineers in the days before and after the Columbia disaster. C2C is making a name for itself in this emerging technology field, and that reputation is leading to dramatic growth.

Jon Brown follows the scandals closely.

Enron. Tyco. ImClone and Martha Stewart. Worldcom. Even the demise of the Space Shuttle Columbia. As those stories broke, he waited for his phone to ring. Usually, it did, because where there’s scandal, there’s usually a paper trail or, in this day and age, an electronic trail. And Brown’s company, C2C Systems, can help a client uncover that trail or, if the customer so chooses, make it disappear.

C2C Systems Inc., the American subsidiary of Reading, England-based C2C Systems, Ltd., is headquartered in the Springfield Enterprise Center (SEC) in the STCC Technology Park. The local company sells and services software programs that help companies, government agencies, and other entities manage their E-mail. And that word manage can take on a number of definitions, said Brown, director of the Springfield operation. Sometimes it means capacity management or archiving. It can also mean controlling E-mail, everything from identifying and eradicating inappropriate or unauthorized E-mailing to tracking down specific correspondences.

And it can also mean deleting E-mail — and when Brown says delete, he means DELETE.

"We provide people with the tools to discover the mail and, when appropriate, to destroy it," he told BusinessWest. "People want us to help them find mail and in some cases delete it. And when they say delete, they don’t mean mark it for deletion; they mean ’make it go away.’

"We make some proprietary technology that goes deep into the bowels of an exchange to get rid of the mail," he said, opting not to be more specific about exactly how the software works. "We can make it so it’s nearly impossible to find."

NASA called on C2C not long after the Columbia disaster because it wanted to track some of the E-mail correspondences between engineers after the shuttle went down, said Brown, adding only that the agency apparently found what it was looking for.

The space administration contract wasn’t large — maybe $10,000 — but having NASA as a client brings benefits beyond the check, said Brown, who told BusinessWest that there have been some discussions with the agency about using it in some promotional material.

If those endorsements do come to fruition, they will likely help the company as it enters what Brown believes will be a strong growth phase. C2C will soon expand within the SEC, effectively doubling its space and adding several new employees as it does so. And Brown believes the venture can move from its current $2 million in sales to $10 million and beyond with more aggressive sales and marketing and new product development.

Indeed, he said work with companies with scandal problems constitutes a very small percentage of sales. Real growth is expected to come in the wake of new regulations regarding when entities must keep and destroy documents, as well as a new global focus on IT security.

Meanwhile, virtually every company and government agency is struggling to keep its E-mail under control, said C2C President David Hunt.

"Capacity has become a huge issue … companies are struggling to find ways to reduce their volume of E-mail," he told BusinessWest from the company’s headquarters in England. "But E-mail is becoming the center of the knowledge flow, or information flow, of a company, so people can’t really be expected to reduce the amount of E-mail; what they have to do is develop a better form of management of it, and that’s where we come in."

Virtual Reality

Brown refers to this niche as the developing specialty of "E-mail life-cycle management." In short, the company helps clients keep their E-mail legal and affordable through a variety of tools and consulting help to implement those tools.

Its products fall into two main categories, said Brown: compliance and discovery — specifically, compliance with laws and corporate policies regarding retention and other issues, and discovery of items that are lost or deleted — and mailbox-size management. This latter series of products helps mid- and large-sized companies deal with the volume of E-mail.

Specific products include, on the capacity side of the ledger, Archive One Capacity, an E-mail archiving and capacity-management solution for Microsoft Exchange; and MaX Compression Enterprise, a family of products that transparently zips and unzips attachments sent and received with Microsoft Outlook, thus saving bandwidth and storage space.

On the E-mail risk-control side of the operation, the company’s main products include Active Folders Content Manager, which controls content and protects an organization from legal liability; and Exchange Security Risk Auditor, a tool that keeps unauthorized individuals from reading one’s E-mails.

The company has provided software to some 3 million users at more than 3,000 organizations worldwide, including national and multi-national corporations and government offices, and believes it is only scratching the surface of the industry’s vast potential.

"I think we’ve carved out a good niche for ourselves in the marketplace," said Brown. "Our goal is to expand that niche and grow the company."

How Brown came to run C2C’s American operation is an intriguing story. A biology and Spanish major at Amherst College, he joked that it wasn’t those courses of study that prepared him for a career in telecommunications. "Instead of a car, my parents bought me an IBM PC, and I locked myself in my room for a month trying to learn how to do something with it," he explained.

He was tending bar at an Amherst alumni party and wound up pouring scotch for an executive with a top-10 software company called Pansophic. "He offered me a job, and I went off to Chicago, without knowing anything about the company or what I was going to do with it."

Brown wound up becoming a product manager for the firm, but was squeezed out after the company was bought by Computer Associates. He then went into sales for System Software Associates (SSA) in Chicago, but left at 25 to pursue an MBA at UMass.

His first stop after earning his degree was a New Hampshire start-up called Tally Systems, where he was a "product manager with no products." But he helped develop one after witnessing a shouting fit by the company’s controller.

"She was screaming about the E-mail bill because, at that time, you had to pay 10 cents a message for MCI to deliver your E-mail over the Internet," he said. "And our E-mail had gone from $300 a month to $1,000 a month in no time.

"I sat outside her office and thought, ’if we’re this little 40- to 50-person company and we’re having this problem, then big companies must be having a huge problem with this,’" he continued. "I went out and talked to about 100 companies, big ones and small ones, and came up with some specs for a product that would help them manage their growing E-mail volume."

Brown put together a company, which became a subsidiary of Tally, and raised $3 million in venture capital to start an operation that essentially allowed companies to put in place an E-mail charge-back and reporting process, similar to what is done with long-distance phone calls.

The company did well, but it was never a core function for Tally, which saw its fortunes plummet when the Y2K craze ended, and eventually gave Brown’s company the axe in a cost-cutting move in early 2000.

That’s when Brown approached C2C, a maker of similar E-mail management software products that was then his largest distributor in Europe, and asked if that growing company would like to fund his venture. Instead, C2C asked Brown to direct its American subsidiary and become a partner in the parent company. "They said, ’you bring us to America.’"

Net Results

For the past three years, Brown has been doing just that.

He ran C2C Inc. out of his home for a while before being introduced in late 2000 to the Springfield Enterprise Center, the recently opened small-business incubator that was housing a number of startup ventures.

"It was a really nice fit for us," he said. "We were looking for a place in which to get settled and commence the growth process, and that’s just what we’ve done."

Brown said his obvious mission is to grow sales of C2C products in North and South America, and to do that he must raise awareness of E-mail capacity and risk issues, and then sell businesses and government agencies on the company’s various solutions to those problems.

And while the scandals that have dominated the business pages in recent years have led to some high-profile clients, Brown and Hunt both stressed that everyday capacity and security issues will drive most of the growth for the company.

When he first opened C2C’s American subsidiary, Brown identified 22,000 potential target customers, which he described as businesses or agencies that use Microsoft Exchange, have 500 or more employees, and have three or more locations.

That number probably hasn’t changed much in the past three years, he said, but there are now certainly more reasons why those potential customers should be interested in C2C products — starting with capacity.

"That’s becoming an issue for everyone," said Brown. "The volume keeps growing every month as more and more people make E-mail their preferred method of communicating information. Companies are going to need ways to keep that volume under control."

Meanwhile, on the risk-control side of the equation, there are a number of new laws regulating the dissemination, safe storage, and ultimate destruction of information, said Hunt. He cited HIPAA (the Health Insurance Portability and Accountability Act), which regulates information about patients and ensures that such data remains private, as one example of greater regulatory control of information — including E-mails. Similar measures are, or soon will be, in place for the financial services industry and other business groups.

"There are new laws requiring entities to retain E-mails for a certain period of time," he said. "This could be two years or seven years after an employee leaves, for example. And there are also more regulations about what is to be kept — or not kept, as the case may be — and companies are going to have to deal with them."

All this will add up to new opportunities for C2C Inc., which Brown believes can double or triple in size in each of the next several years. And in anticipation of a bulked-up sales and marketing initiative, the company will double its space in the SEC and remain there as a tenant for the foreseeable future.

Meanwhile, Hunt anticipates expanding C2C’s American operation and adding more offices over the next few years. The headquarters will remain in Springfield, however.

Tracking Growth

Brown told BusinessWest he was somewhat surprised C2C didn’t get a call when the ImClone scandal broke last year. "That’s one we missed," he said.

There haven’t been many such incidents in that category, thanks to a growing reputation for helping companies and agencies find what they are looking for.

What C2C is looking for is additional growth — on both sides of the Atlantic — and it would certainly seem to be on the right track — literally and figuratively.

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