Company: SRA Spectrum Solutions Group Inc.
Position: Chief executive officer
Education: Bachelor's degree in comparative religion from George Washington University; master's degree in business administration from Johns Hopkins University; and a doctorate in operations management from the University of Southern California
VIENNA, Va. - The horror of Sept. 11 affected different people in different ways. Some people switched to more meaningful careers; some people changed their political parties; and some people became more patriotic. Pat Sidhu did what he does best: He started a company.
"Consulting is about service and this allowed me to give a service to my country," said the 40-year-old Sidhu, the chief executive officer of SRA Spectrum Solutions Group Inc., an IT-consulting firm that works with the federal government.
The concept also provided Sidhu with an opportunity to enter a market that was poised, at the time for enormous growth. After 9/11, the government needed IT systems that could more efficiently and effectively communicate with its various networks, as well as systems that could be more easily managed by new and fewer workers.
"The government needs systems with open architecture so they can talk to each other and identify issues before they’re issues," said Sidhu. "The government wants to be more proactive and more customer friendly. We’re making the government more efficient and more able to deter situations like 9/11."
Sidhu started working on the idea for Spectrum Solutions in October 2001, and a little over a year later he founded the company. Within three years the company had 150 employees, $15 million in annual revenues and a number of subcontracts with the government. It also secured its first major contract with the Coast Guard in a five-year deal worth $15 million.
This past November, Sidhu sold the company to SRA International Inc., a 4,800-employee IT consulting firm that also works with the federal government. "We had a five-year plan about where we wanted to get to," said Sidhu. "We didn’t expect anyone to approach us but that’s what happened."
The two companies are two pieces of a puzzle, said Sidhu. "They offered us customer relationships that we needed to accelerate growth. SRA has relationships with every agency; we have the delivery capability. Its not about money, its about growing the business. We want to be the dominant player in [enterprise resource planning] systems in the federal government."
No one has ever accused Sidhu of thinking small and this case is no different. According to Sidhu, nearly every agency in the federal government will be implementing a new enterprise resource planning system in the next few years, creating a $10 billion market for companies in that industry.
Spectrum is now a subsidiary of SRA and will continue to focus on enterprise resource planning by developing back office systems for large organizations, said Sidhu. He and Spectrum co-founder, Sonu Singh, president and chief operating officer of the company, will continue to run the company but Sidhu will have to adjust to life as part of a larger company, something for which he has had only limited experience in an entrepreneurial career that started out with a bang.
Sidhu said he always wanted to go into business despite being the son of a doctor, who brought Sidhu to the United States at the age of two from Punjab for. "I saw limitless opportunities and challenges in doing it in a way that works," he said of a career in business.
Sidhu said he always wanted to go into business despite being the son of a doctor, who brought a 2-year-old Sidhu to the United States in 1968 from Punjab. "I saw limitless opportunities and challenges in doing it in a way that works," he said of a career in business.
After graduating from George Washington University in 1987 with a degree in comparative religions, Sidhu got a master’s degree in business administration from Johns Hopkins University, a doctorate in operations management from the University of Southern California and then decided, at the age of 24, that he was ready to strike out on his own. In 1990, with a loan from his father and his own savings, Sidhu invested in a medical clinic with a group of doctors. Over the next two years, the business grew to three clinics but when the other partners didn’t want to continue to expand, Sidhu left to form Liberty Lending, a company that provided direct securitization of loans. Within a year, the company grew to 250 employees and five branches were opened around the country.
A few years later Sidhu sold the company to a bank in Atlanta and walked away. As he tells it, he "could’ve stayed home" with the money that he made but instead he took a few months off to work on a new idea, a series of Internet portals for children. After raising $20 million in venture capital funding, the company, High Fusion, was launched at the end of 1999. By August 2000, it was up to 200 employees and was bought by Mindsurf, Inc., a joint venture of Aether Systems and Sylvan Ventures.
Sidhu stayed on a year and then came 9/11. With the government moving towards already developed systems, instead of customized ones, and with over half of its workforce eligible for retirement - creating, as Sidhu noted, huge training issues -- Sidhu saw an opportunity.
"I understood the value of an efficient back office, especially for the government," he said.
After Sidhu met Singh, they put together some funding and got to work. Because neither of them had contacts in the government and because of the long sale cycle required when responding to request for proposals from government agencies, Sidhu did the next best thing: He looked for subcontracts. An agency within the government's Health and Human
Services department had hired IBM to implement a new enterprise resource planning system but Sidhu heard it needed help with the project. Sidhu pitched his ideas to IBM and within a year Spectrum had 25 people on the job.
At the time, Spectrum also wanted to get into security systems, which Sidhu believed needed to be networked with enterprise resource planning systems. Spectrum acquired a small company that became Spectrum Security that had a contract with the Department of Defense to implement security systems in various army bases. When Spectrum was bought by SRA, Spectrum Security -- which comprised about 10 percent of Spectrum’s business -- was sold off to another company.
"We sold [Spectrum] to make sure the vision was completed," said Sidhu. "When growing [a company] it’s hard not to look for ways of partnering. With each company, I thought I’d be there forever but it was always the right thing for the company. Doing the right thing always pays off."
In Spectrum’s case, Sidhu believes that the company now has the tools to create something of "lasting impact. These systems will be there for years and, on a broad level, affect millions of people. We want to be the de facto standard of here’s who to go to implement ERP systems in the government. We want to be successful as part of a larger company. I see opportunity and I will be disappointed if we don’t get that."