​EXCLUSIVE: Origin IT ups NZ ante with security and networking acquisition

Stuart Alexander - COO, Origin IT

Growing New Zealand ICT specialists Origin IT has strengthened its hand in the local enterprise market, acquiring networking and security experts Optinet for an undisclosed fee.

The deal remains in line with the Auckland-based company’s aggressive growth strategy, which includes plans to reach $50 million in revenue by 2018, by increasing the business’ competency and geography across New Zealand.

For those in the know, the Optinet acquisition is a smart move, with the company leading advances in networks and security since 1991, growing over the years to be a well-respected industry leader.

In short, the Auckland and Wellington-based firm designs, builds and supports network solutions for businesses throughout New Zealand at enterprise, corporate and SME level.

“Security and networking continues to grow in importance for businesses,” says Stuart Alexander, Chief Operations Officer, Origin IT.

“We will build on the value and market presence that Optinet has delivered to their enterprise customers over the years, while also providing our mid-market clients with access to the power and security of these solutions.”

Logistics of the deal will see Optinet’s 12 employees and four contractors join the Origin team, with the acquisition effective from October 1.

Alexander says the acquisition shows strong intent from Origin in the marketplace, as the company increases its commitment to meet the security needs of businesses nationwide.

“Security is a prevalent market need and now we can better serve our clients and continue to extend our value in this area,” he adds.

Having paid a “fair market price” for the company, Alexander says Origin will continue to invest in Optinet to ensure they can grow and meet “burgeoning client demand” in the enterprise market.

“As well as assisting with our existing Origin clients and the wider mid-market who have increasing needs in both security and networking to assist transition to the cloud,” he explains.

Why Optinet?

Since its inception in 1991, Optinet has established a solid record in the design, build, implementation and servicing of large networking solutions for a number of New Zealand’s corporate, government, tertiary and service provider organisations.

Originally trading as Asnet Limited, the company’s new name Optinet was launched in 2014 to better reflect the company’s function as the leading provider of network optimising services in New Zealand.

“Optinet are recognised as high value, highly competent by their existing clients,” Alexander adds.

“They have extensive skills and competencies that we are confident are needed today across the breadth of the mid-market business sector along with strong ongoing demand in the enterprise market they already serve excellently.

“With further investment we are confident we can enable them to grow across both market segments.”

Adding weight to Alexander’s claims, through 2000 to 2010, Optinet were first to market with a number of innovative new solutions to support the growth of the internet and throughout the 2000’s led the way in developing the video conferencing market in New Zealand through the distribution of a range of Polycom products.

In 2008, the company introduced the Aerohive wireless solution to New Zealand, along with Juniper Networks in 2013 and continues to service as a leading provider of security and networking infrastructure.

“We are already utilising Optinet to perform security reviews and penetration testing for our clients that recognise the importance of protecting their business assets and IP by firstly identifying areas that need to be addressed and improved,” Alexander adds.

“We will be working to develop new service offerings in conjunction with Optinet. With thorough planning and investment we believe we can execute this strategy in early 2016.”

Why now?

As predicted by analyst firm IDC, the ICT industry, whether that be in New Zealand or globally, is in the midst of a technological shift, one that comes along every two or three decades as organisations shift to a new technology platform for growth and innovation.

In 2015 and beyond, businesses are moving to the 3rd Platform, built on mobile devices and apps, cloud services, mobile broadband networks, big data analytics and social technologies.

So much so that by 2020, at least 80 percent of the industry’s growth will be driven by these 3rd platform technologies with an explosion of new solutions built on the new platform, along with rapidly expanding consumption of all of the above in emerging markets.

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Consequently, design, build and maintenance of networks and particularly the integration of applications, cloud services and mobile devices will continue to be a major challenge for most network managers, requiring specialist skills and knowledge that sits outside many in-house team specialities.

For Alexander, network and security infrastructure has never been more important for businesses than it is today.

“It is clear the strong demand for security reviews, penetration testing and skilled network management is a competency that is needed across the market,” Alexander adds.

“All our client’s directors and C-suite members recognise the need to protect their business IP and secure their environments in the face of growing local and international security threats.

“We want to ensure we can play a valuable role in mitigating the risk faced by our clients and future clients.”

Alexander says Origin has its own networking and security competency which he believes will complement the Optinet business.

“We have already been operating jointly in many Origin clients,” he adds.

“We have a successful Service desk that will provide Optinet with an opportunity to enhance the service they deliver to their clients today and better utilise the Optinet skilled engineers to focus on strategy, architecture and design solutions for their clients.”

Transition

The acquisition brings to an end the tenure of founder Steve Harrington, who is stepping out of the business to focus on outside interests.

Optinet General Manager Craig Burston however, who has been leading the business since 2011, will continue in his role, Alexander adds.

“The Optinet brand will remain firmly in the market as it is today,” Alexander explains. “The brand is well recognised and has a high value and quality associated with it.

“Craig has successfully grown the business of the past few years and the great people at Optinet will continue to be a part of Craig’s Optinet team.

“We are confident Craig has the skills and support of not only his team but the Origin family to continue the rapid growth that he has set in place with Optinet. Craig has developed a solid business plan that we are fully supportive of.”

Optinet partners with a host of industry leaders, typically housing more than one vendor in each of its product segments - such as Blue Coat, Aerohive Networks, Fortinet, Aruba Networks, F5 Networks, Brocade and Huawei to name a few.

At present, the company also works closely with telcos such as Vodafone, 2degrees and TelstraClear, tertiary education facilities such as Otago University and AUT University and large organisations such as Westpac and IBM.

“There is no change to the Optinet business other than further investment to enable the business to grow into our client market and to broaden the Optinet ability to serve more clients within their Enterprise market as well,” Alexander adds.

“We believe the positive benefits that Origin bring to Optinet will give the existing Optinet clients even more confidence to engage Optinet and Origin to ensure they are well position to advance their own businesses safely and securely.”

Future growth

As claimed in December last year, the kiwi tech firm expects revenue to grow by over 200 percent in the coming five years as their clients expand offshore and demand for local IT support services grows.

Established in a West Auckland garage fourteen years ago, the outsourced IT solutions provider currently records annual revenue of $14 million. But according to CEO Michael Russell, that’s projected to reach $50 million by 2018, a figure that Alexander believes could now be surpassed.

“Optinet has grown their business significantly over the last few years and this combined with the year-on-year Origin growth will greatly assist in our focus to not only grow the combined businesses but do that whilst delivering great value and quality to our current and future clients,” Alexander adds.

“There are many clients in the market today looking for great service combined with world-class skills and we intend to ensure we can meet those demands.

“We currently are tracking ahead of our goals and this addition to the Origin family will definitely assist us towards beating the current goals.”

In fact, adds Alexander, “it may be time to reassess those goals.”