Net Value: Going Global via Web 2.0
The Edge - October 1, 2007
By Toh Mei Ling

Initial public offerings (IPOs) are often synonymous with global or regional expansion as they facilitate the raising of much-needed funds to take the business overseas. This has been the general understanding for many companies. But in today's borderless world, companies can offer their products and services overseas via the Internet and they need not seek a listing to give them the financial muscle for such expansion. Software solutions provider Maestro Solutions has come a long way since it was founded and is now looking to utilise the Internet to venture overseas.

Incorporated in 2003, Maestro Solutions was one of the winners of Venture 2002, a business plan competition jointly organised from 2001 to 2003 by the Malaysian Institute of Management (MIM), the Mesdaq Market and management consulting firm McKinsey and Co Malaysia. Its three partners — Maisie Chui, Aris Samad Yahaya and Azreen Latiff — decided not to opt for venture or seed funding but instead self-finance the company and let it grow organically. Four years down the road, they are flouting conventions by moving overseas prior to their IPO slated for next year.

Photograph courtesy of The Edge

"Our main goal has always been to go global but we recognise that it requires resources that are out of our range. Hence, the development of our Web2.0 business applications, utilising the Internet to take our products overseas. Our business applications are run over the web, require no training and can be used to solve business cases. We believe we can move the market past its tipping point because of the user-friendliness of the product," explains Chui, Maestro's chief marketing officer.

Maestro's Web2.0 business model is similar to that of Salesforce.com and Entellium, two leading web-based customer relationship management software providers, where the solution is real-time and hosted online. Customers can sign up for the solutions and start using the software immediately without having to install any software clients on the computer. Providing solutions via the Internet drives cost down, as manufacturing and distribution costs have virtually been eliminated.

"The costs incurred are amazingly low. Earlier, we felt that the Internet was too young. Now is the right time to move in this direction as can be seen with Salesforce.com's success. Previously, businesses were afraid to put their data on the Internet, but for schools — which are the target with our school management system — it is much easier because the data is not so sensitive. Admittedly though, not all segments prefer the Web2.0 method, so there will be a natural equilibrium," says Maestro's CEO Aris.

The business sectors that Maestro caters for have always been niche markets, like supply chain and construction industries. The move into school management systems and business intelligence is part of a strategy to diversify its income stream. Both systems have been completed, says Azreen, and the school management system already implemented. As the Malaysian market is too small to capture a big number of potential consumers, Maestro is looking at penetrating the US market as well.

"We are now in talks with a private school chain that has a network of schools globally and over 100 in the US. The lead came to us through a client referral. We are targeting the North American market because it is well accepted there. Schools there are now starting to adopt technology, so this is a good starting point," Azreen adds. In line with the company's direction, Chui, who is an American, will be moving back to the US to manage the business there.