When a two-year-old consulting firm grows 157 percent—from $4.4 million to $11.3 million in one year—something good must be happening. That's the case at Dominion Business Solutions, a Reston, Va.-based IT firm focused on the public sector.
Launched in October 2009, things got off to a rather slow start at Dominion. "We didn't hire any consulting staff until we had pipeline, and that was our staffing model for most of 2010," says Dan Maguire, Managing Principal and co-founder of the firm.
J.P. Foley, Managing Principal and co-founder, says he and Maguire referred to their "virtual bench," as a way to avoid the overhead costs that often drag down a fledgling firm. But by the spring of 2010, DBS was off and running with meaningful engagements with large federal clients.
If it sounds like Foley and Maguire knew what they were doing, it's because they did. They had already done it a few years before when they left bigger firms (Maguire, PwC; Foley, Andersen) to start Washington Consulting, which had great early financial success, as well, before being acquired in 2006. However, the two admit they made a few mistakes along the way.
"Last time was our first foray into a small business," Maguire says. "Prior to that, we only knew big company policy and procedure so we made Washington Consulting very structured. With DBS, we're trying to keep it really simple. All those overhead tasks that take hours and hours are the reasons people don't want to work at large firms. We realize that now."
Washington Consulting reached 122 consultants, and Maguire says he remembers the day when someone walked down the hall "and JP and I looked at each other and said who the heck is that? We learned some lessons, that's for sure." So, as Dominion aims to nearly double this year to 80 consultants, how do the two make sure they don't repeat the mistakes of the past? In a word, culture.
On the first day of work, each new employee is given plenty of DBS-related equipment and gear, and the firm provides health insurance at no cost to employees, a 4 percent 401(k) match with no vesting period, 28 total vacation days and paternity/maternity leave.
So, how far can the firm go? "Our path to growth is pretty easily attained—with a lot of hard work, of course, but it's organic and we can see a path to $25 or $30 million here in Washington," Foley says. But then Maguire adds "that a lot of businesses don't do well if they are sitting at $35 million. They're too big to be small and too small to compete against the big guys."
So, if we see two more years at these current growth rates, we'll have to start looking at acquisitions," he says. "We're going to want to get to $50 million pretty quickly, and that's a totally different ball game."
—J.K.
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