The Secret Sauce of an Inc. 5000 Company
Q&A With CEO Paul Hager
This is the story of how a two-man IT shop that began in 2003 became one of the top-performing and fastest growing IT companies in the country.
In 2010, Paul Hager decided to join a small IT company serving law firms in Wisconsin. Just four years later, Hager bought the business and has subsequently taken Information Technology Professionals (ITP) to new levels of success and recognition, as the company celebrates 16 years of serving Wisconsin’s people and businesses. Under his leadership, ITP has become one of the primary IT players in the Midwest and has made the Inc. 5000 list 5 years in a row.
Q: How did ITP manage to stay on the Inc. 5000 list multiple years in a row? Why is that so hard for companies to do?
A: Only 4% of companies ever make the list 5 times in a row. The Inc. 5000 is a 3-year running growth measure. So for the 2018 list, we compared our 2015 revenue to our 2018 revenue. For 2017, it was comparing our 2014 revenue to our 2017 revenue. And so on.
Starting at the 3-years-in-a-row mark, to even make the list you have to have a big jump in revenue. And you must have a minimum of $1 million in revenue just to make the list in the first place. You can’t go from $5 in revenue to $5000 in revenue – it’s not going to work that way. You have to start at the $1 million threshold.
So you start at $1 million annual revenue. Say you make $1.2 million in revenue. That number then becomes the new baseline revenue level you have to beat the following year. So as the years go by, your base revenue number gets higher and higher. To maintain that level of growth, you need a high double-digit to triple-digit three-year year-over-year growth rate.
“It’s not that a lot of bigger companies don’t grow, it’s just hard to put up the type of growth rates that the Inc. 5000 shows.”
This list is not to identify those stalwart companies in the U.S. that are $50-100 million companies growing at a perfect 5% clip year-over-year. That’s still really impressive.
I give a lot of respect to any company that’s able to continue to stack growth in any area, either revenue or margin, on an ongoing basis. It’s hard to be consistent. Every business has an ebb and flow to it – technology in particular. It’s such a rapidly changing market. But I think credit is due to any business that’s able to consistently show growth year after year.
Q: Is ITP’s growth a reflection of larger trends in technology adoption?
A: Because of the digital transformation going on in all areas of business, we need technology to deliver our services even more than we did 5 years ago. We’re in the iPhone era where things are supposed to be intuitive and easily consumable.
At the pace that technology comes out, even companies with really smart people aren’t able to devote the time and resources it takes to take in all the rate of change and innovation going on in the Microsofts, the Nutanixes, the Scale Computings, the HPs, the Ciscos of the world. It’s challenging to try to predict how that rapid growth in technology will translate into something that affects their business.
So that’s what we are. We call ourselves translators. We translate all of this new technology year after year, adapting to the change in the markets.
“At ITP, if we can say we’ve done something right it’s that we have identified trends in technology, identified the market leaders that are emerging and changing, and we’ve helped adapt those changes to our customers on their behalf – and have done it successfully. “
And then it’s providing a great customer experience. I don’t think any company grows without having really great customers. And you don’t have (and keep) really great customers unless you keep the focus on them. You can have great salespeople but if they’re having to sell to all new people every day, you’re not going to be able to stack growth or build recurring revenue streams. You’re going to have too much going off the back of the treadmill so you have to run harder forwards.
That’s not what we do here. We create great customer experiences. Those experiences start with our amazing people that live our core values of transparency, integrity, and commitment to that customer experience. Our people act with purpose every single day. That’s what has our customers staying with us. We translate for them. We help them through this changing world of IT.
Q: Do you think ITP can get on the Inc. 5000 for a 6th time?
A: Making it 5 years has been a goal of ours, and now we can check that goal off the list. As ITP looks forward, we’re asking how we level ourselves up and put ourselves in a place where we can continue to grow in a solid way and be there for our customers for another 16 years. [ITP celebrated its 16th anniversary in 2019.]
With manufacturing and agriculture dominating Wisconsin’s economy, these businesses are often the ones that need the most help with technology. We’re even doing work outside of the state now through a partner network. We’re helping IT partners that aren’t as developed in things like Office 365/Azure migrations, Teams Voice, and some of these things that we are really good at before the rest of the market is good at it. This is a year where we’re really making sure we have our feet in the right spots so we’re ready for that next platform of growth, that next spurt.
Q: What does it mean to you to see ITP growing and being successful?
A: In a space where technology companies come and go, we want to be that anchor for the state of Wisconsin and companies in Wisconsin so that we’re there for them to translate technology now and into the future.
Everyone at ITP is committed to making technology great, consumable, and understandable – not something to fear but something to embrace. We’re about helping a company (whether they’re a startup or they’ve been in business for 100 years) find that piece of the “digital transformation” that makes sense for their business. And then help them deploy that appropriate technology so that Wisconsin is strong, healthy, and ready for the next wave of change.
“When it’s technology, there’s always change. That’s what makes it exciting. It’s part of why I love what I do and what we do here. Every 6 months our world changes. We take those changes in stride and help our customers adapt to them as well.”
So thanks to our amazing staff that makes awards like the Inc. 5000 possible. Thanks to our amazing customers and their loyalty in a world where there’s a lot of choices. Your confidence and trust in us we do not take lightly. We’re going to make the next year and the next 16 years the very best we can.