How Southern NetworX Has Avoided Financial Over-Leveraging

Dollar SignThe business philosophy followed by Southern NetworX is somewhat different than those followed by most small businesses. Jeremy Anderson (CEO) and Michael Petri (CTO) have similar backgrounds in technology, and both have worked for a few companies in the past that might have had a good thing going (as far as products/services offered) but ended up failing due to poor management at top levels. This is something we strive hard to avoid at SNX.

The problem is actually quite simple, and it translates from the routine of our everyday lives and how we do things nowadays vs. how things used to be done in the past. Starting and growing a business has always been a big part of the “American Dream,” and entrepreneurs continue to pursue that dream every day. Unfortunately, a huge number of start-up companies fail very quickly and many fail much later while seemingly doing so well. According to the U.S. Small Business Administration, over 50% of small businesses fail within the first five years. Why?

We believe a large part of this is due to the fundamental change that has occurred in the way people choose to financially fund and develop their businesses. Without a doubt, technological development over the past couple of decades has made us more connected than ever. The Internet has allowed us to gain access to information and data like never before, and it’s made us more productive in so many ways, so why are so many businesses failing? Some would argue that the same technology that has connected us and made information so easily accessible has also made us much more short-sighted, and infinitely reliant on instant gratification. This is especially true when it comes to funding our business ventures.

So, what does all of this mean for a small business? Here’s an example of how things used to work, vs. our current “have it all now” model that provides us with instant gratification:

1960’s: A small mom-n-pop auto repair shop in a small town has no other franchises, no debt, and is considered profitable. They keep their books in the black and enjoy life.

Today: Same business scenario in today’s economy would be considered unsuccessful unless they can now open 20 new franchises in neighboring towns, all within the first 12 months of start-up, on borrowed money, from banks or investors or what have you. This means that while the single repair shop may have started back in the ’60s and continued to be profitable and self-sustaining decades later, the same shop started today, using the wrong mentality, could easily over-reach too soon while at the same time being financially over-leveraged and end up having to close its doors because it can’t pay its bills.

Jeremy and Michael have witnessed too many of the companies that they used to work for go under, either going from true profitability to loss (due to waste) or never being profitable at all and only surviving because of investor funding, which was all based on promises to the investors that there was some magical return on their investment in the very near future.

At Southern Networx, what we have tried to do is learn from all these different failed companies and build ours based on what we would have done differently. The main thing that we always took away from the past experiences is this: to make sure that the company is always self-funded. At SNX we are not dependent on outside funding, which means that we do not answer to any investors or any other outside parties who may NOT have the company’s best interests in mind. This allows us to make our own decisions as to which direction the company goes, and allow us to ensure its survival and profitability.  Thus far, it has worked beautifully.

What businesses do you know of that have used financial over-leveraging to start out? Has it worked for them, or have they ended up closing their doors?

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Interview with Michael Petri, CTO – Part 2

Michael Petri, CTO
Michael Petri, CTO

Continuing on last week’s topic, the second half of the interview with Southern NetworX’s CTO, Michael Petri, is found below.

4)      What is your background, before SNX?  How long have you been involved with Information Technology?

“Officially, I have been involved with IT for about 10 years.  I say ‘officially’ because that’s about when my professional career in the IT industry started.  I started messing around with computers sometime around the mid-nineties and then attended North GA College, pursuing a degree in Computer Science.  In my Junior year I landed a Tier-1 tech support position working on run-of-the-mill PC and networking issues.  I then moved into a similar position, but mostly geared toward VoIP services as the company moved to offer those services as the main product/service.  That department grew into a full Network Operations Center (NOC) which I took charge of and was still running when we acquired the company that Jeremy was working for and he became part of my NOC staff.  Over time, my IT background has developed more in the direction of network engineering and VoIP phone services, mostly centered around a Broadsoft soft-switch.  During my tenure as a NOC manager, I also worked on developing more non-technical skills, such as business development, project planning, process development; skills generally more analytical in nature that would help me look at departments first, and then businesses as a whole, and try to figure out ways to make them better and more efficient.”

 5)      Where do you see the company going in the next 5 years?

“This is an interesting question, because I’m sure that if you asked it to Jeremy, you’d get something along the lines of ‘We’re all going to be sitting on the beach, sipping margaritas, with the company raking in $10,000,000 in profit per year’.  And that, of course, is what I really like about him.  I enjoy the juxtaposition of his grand ideas and visions and my feeble attempts at bringing them down to a tangible reality and it’s what makes our conversations, and our company, so great.  It allows us to come up with all kinds of visions for the future and the direction of the company and then convert them to actual business plans and models that are reachable.  Now, where do I see the company going in the next five years?  Without throwing any numerical values out there, what I see is a stable, profitable company, that has grown organically, by offering our services with ‘quality over quantity’ in mind.  I see us being a company that has built a brand, recognized for superior service above all.  And, I see us, hopefully, diversifying that brand into other technology-oriented areas where we can apply the same expertise and quality service that we have become known for.  Although, I suppose, sitting on a beach, sipping margaritas, while raking in millions is also nice.  I’ll leave that to Jeremy, though.”

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Encouraging Entrepreneurship Through the SNX Reach Foundation

SNX Reach Foundation
SNX Reach Foundation

“I came up with my first business plan at around the age of 10…something to do with selling my grandfather’s black cherry tree seedlings. But with no support from my family, and no way to keep the trees watered once summer camp started, the seedlings died and the idea failed.

Kids this age are quite often told ‘you’re just a kid – that won’t work.’ The SNX Reach Foundation is built to combat that negativity. We promote and support youngsters’ ideas and early business plans, and let them know that they CAN do it.”
– Jeremy Anderson, CEO, Southern NetworX

America was founded less than 300 years ago by the Founding Fathers, who most likely thought a lot like Jeremy Anderson does in the quote above. Entrepreneurship and small business was the foundation that America was built on, and is a concept promoted within Southern NetworX and through the SNX Reach Foundation, a non-profit organization created to promote kids’ creative concepts/ideas about starting a small business (website forthcoming).

Growing up, young Jeremy encountered multiple layers of resistance when coming up with ideas for small business ventures. After hearing “you’re just a kid, you can’t do that” and “we don’t have the money to invest in an idea like that,” a sort of fear crept in. Fear of the unknown…fear of lack of support…fear of being shot down. It’s true, kids can come up with some crazy ideas, but at the SNX Reach Foundation we want to harbor that creativeness and show children that it takes a little bit of “crazy” to be an entrepreneur.

Finally, at the age of 33, Jeremy was able to overcome the fear of the unknown and dive into what is now Southern NetworX.  The non-profit organization SNX Reach Foundation was created within the past year, and is designed to help kids across America overcome their fear of being scrutinized and not receiving emotional and/or financial support. We plan on accomplishing this by having writing contests in which the winner earns free computer equipment and machines for their school, hosting educational webinars and events for the children, and supporting young minds by finding other companies/organizations/investors that share this dream and want to help the future of America.

Founding Fathers of America
Founding Fathers of America

“Agriculture, manufactures, commerce and navigation, the four pillars of our prosperity, are most thriving when left most free to individual enterprise.”
– Thomas Jefferson

What kind of crazy ideas did you have when you were a kid? Do you think your life would have turned out differently if you’d had more support?

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Information Technology: Bringing the world closer one “bit” at a time…

(Thank you to Rodel Henry for participating in our “Title the next SNX Blog Contest” and coming up with the title for today’s blog!)

 

Information Technology, or “I/T” as it is more commonly referred to, is a phrase used quite frequently today, but a term that only truly began to emerge as an every-day concept within the past 20 years or so. “Information Technology” may just make you think of the computer or computer network you’re reading this on, but in fact, it refers to everything from software to hardware to network administration and beyond. Wikipedia defines “Information Technology” as:

 “…the application of computers and telecommunications equipment to store, retrieve, transmit and manipulate data…also encompasses other information distribution technologies such as television and telephones…In a business context, the Information Technology Association of America has defined information technology as “the study, design, development, application, implementation, support or management of computer-based information systems”.

How much has I/T actually changed in the past 65 years? Here’s a breakdown, by decade.

 

The 1950’s:

“Considered as one of the most conservative decades in recent memory the 1950s were a time when technology underwent a dramatic evolution.” (-techradar.com)

Enter the world’s first stored-program computer (read our blog about “BABY” here), the first commercial modem – the AT&T Dataphone, and the microchip. While the first microchip bears little resemblance to its modern counterpart, without it, you could say goodbye to your iPhone.

The 1960’s:

  • The first commercially available microchips were released by Fairchild Semiconductor Corporation in 1961 and were around the size of your pinkie.
  • A remote online search system is publically demonstrated for the first time by SRI.
  • The public sees a mouse for the first time.
  • April 22-October 17, 1964: The New York World’s Fair offers public viewing of online bibliographic retrieval at Library/USA. This is the first time the general public sees bibliographic information and interacts remotely with librarians through a computer using standard telephone lines.
  • 1969: Internet officially comes into existence.

The 1970’s:

  • The birth of modern computing was in the 1970s. The world’s first general microprocessor — the Intel 4004, came out on Nov. 1971.
  • Rudimentary personal computers began to be produced along with pocket calculators.
  • The availability of affordable personal computers led to the first popular wave of internetworking with the first bulletin board systems.
  • Beggining of the video game era – Atari is established
  • Start of Fiber Optics.
  • The integration of the computer and robot, particularly in Japan, saw unprecedented improvements in mass-produced automotive quality…such cars as the Honda Civic and the Toyota Corolla became some of the most popular and iconic vehicles of the 1970s.

The 1980’s:

  • On January 3, 1980: Hewlett Packard introduces the HP-85, a “microcomputer” with 16kB of RAM and a 5-inch CRT display.
  • Microsoft licenses Unix and starts to develop a PC version, XENIX.
  • Xerox introduces the graphical Star workstation, which greatly influences the development of Apples future computer models, Lisa and Macintosh, as well as Microsoft’s Windows.
  • Disney releases the movie “Tron” on July 9, 1982, the first movie to use computer generated special effects.
  • A Philips factory in Germany creates the world’s first compact disc August 17, 1982.
  • The 3.5-inch floppy diskette is introduced and later becomes an industry standard.
  • The first e-mail from China is sent to its connection in Germany September 20, 1987.
  • 1989: Invention of the World Wide Web by British scientist Tim Berners-Lee and Belgian Robert Cailliau

1990’s: The Information Age begins…

In 1991, the World Wide Web is implemented, and the Internet truly becomes a global network.

The 90’s saw the spread of the Internet which caused a sudden leap in access to and ability to share information in businesses, at home and around the globe. Technology was developing so quickly that a computer costing $3,000.00 in 1997 would cost $2,000.00 two years later and only $1000.00 the following year.

Innovations of the ‘90s:

 

The “Information Age”, which started in the 1990’s, and which we are currently living in today, is a period marked by the shift from traditional industry (brought about by the industrial revolution) to an economy based on the information computerization. The evolution of technology in the past 65 years is nothing short of astounding, and if it continues at this rate, the world our children’s children live in will probably be a far cry from this one.

 

How do you think the world of I/T will change in the next 65 years?

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Welcome to our blog!

information_technology

Southern NetworX is an Information Technology Solutions Provider based in Atlanta, Georgia, with clients that consist of small businesses with anywhere from 3-300 employees. Our CEO, Jeremy Anderson, founded the company in 2008 and after finally getting all our cards lined up in a row we are now in the position to put a huge emphasis on growing our company and gaining new customers! This blog is the next step in that process.

The purpose of this blog is to provide our prospective readers with useful and interesting information about the world of Information Technology. There are five main topics that this blog will expound upon:

1)    History of Information Technology At Southern NetworX, our goal is to provide our customers with everything from IT strategy and consulting to hardware repair and maintenance. However, this is only small facet of the world of IT. How did we get to where we are today? Where did IT start, how far has it come, and what is the outlook on the future? This blog will explore the history and progression of information technology and its existence in our everyday lives.

2)    Best Smartphone Apps/Computer Software Available Almost everyone we know uses a Smartphone nowadays, but with so many different apps coming out on a weekly basis (for computers, as well) it’s easy to miss or overlook some of the best ones out there. This blog will feature what we consider to be some of the most useful and interesting apps available on the market today, our personal opinions and experience with them, and what we think they offer to our readers.

3)    Information Technology as it relates to the rest of the world – What different products and concerns do other countries focus on and how does that relate to us as Americans? Does it affect us and if yes, how so? What are the pros and cons of the way we as Americans utilize technology vs. the rest of the world?

4)    Malware/Malicious Content/Computer Optimization Tips – The world we live in provides us with the daily threat of identification theft and computer hijacking. This blog will expound upon the easiest and most efficient ways to protect your computer and backup your information/files, as well as best practices to keep your machine running as quickly and efficiently as possible.

5)    Entrepreneurship & running a small business – Jeremy Anderson, the CEO of Southern NetworX, developed his first business plan at the age of 10 and is a natural entrepreneur. This blog will expound upon some of his failures and successes and provide insight into the world of entrepreneurship.

Here’s how we anticipate this working. Periodically, we will write a new post, most likely once a week for the first 6 months or so. Please do provide us with feedback. We welcome your opinions and perspectives on the topics above, and hope to inform and educate all who are interested!

-The SNX Professor-

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