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New CEO Readies Silicon Genetics for Scale-up (And a Little Bit More Recognition) in 2003

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Silicon Genetics CEO Saeid Akhtari is faced with what he describes as “a great problem” when it comes to brand recognition of the company’s flagship product, GeneSpring. “I’ve been introduced as the CEO of GeneSpring; we get checks made out to GeneSpring,” he said, without the slightest concern that more people know the name of the gene expression analysis software than that of the company who developed it. “Microsoft,” he pointed out, “was once known as the ‘DOS company.’”

Hoping to follow in the software giant’s footsteps, Silicon Genetics is embarking on a new phase in its development as a company. Following a year in which its revenues grew by 40 percent while many of its competitors floundered, the company is hoping to keep that momentum going throughout the coming year with a balanced strategy of new product development and a ramped-up sales and services effort.

In line with this approach, Andrew Conway, the founder of the company and developer of GeneSpring, stepped down from his post of CEO in late January in order to devote his attention to the development of a new software product for gene expression analysis. Akhtari, formerly COO, was promoted to fill the top spot.

Just a month into his new position, Akhtari has already begun to fill senior-level positions in the company’s growing sales, services, and marketing teams. Gregory Kinch, formerly executive VP of sales and marketing at Genomic Solutions, joined as VP of sales and services in mid-February, while Kevin Wandryk, an Internet technology business development veteran, joined as VP of marketing and business development in November. Around half of the company’s 55 employees are currently in sales and marketing, Akhtari said. Depending on the rate of revenue growth in the coming year, that number could grow by 15 percent to 20 percent by the end of 2003, he estimated.

GeneSpring “has been a great success story for us,” Akhtari said, largely due to the software’s relatively early arrival on the market. Launched in 1998, GeneSpring appeared on the scene several years before the demand for microarray analysis tools skyrocketed in 2000, which gave the company time to tweak the product. “For the first year or two, a software company is still learning the needs and requirements of its users,” Akhtari said. “You can’t come up with 1.0 and claim it does everything.”

The early emergence of the software also helped it gain a reputation among academic users, and even today, Akhtari said, “the biggest sale for us now is word of mouth.” However, recognizing that the gene expression analysis market is still in its early stages, Silicon Genetics is not counting on a sterling reputation or on word of mouth to carry it through the next few years. While it is confident that the market for its software is expanding — both on the academic side and in the commercial side — the company’s list of competitors is also growing.

Right now, Silicon Genetics is seeing a lot of growth from customers converting one or two desktop licenses for GeneSpring to larger-scale enterprise licenses, Akhtari said. In addition, he said, the company is seeing increased interest in its GeNet enterprise-level data management system. As gene expression experiments “work their way from the R phase of R&D to the D phase,” according to Wandryk, Silicon Genetics is confident that it has tapped into a market segment able to offer sustainable growth.

While the company historically has taken a “bottom up” approach — “simply helping the scientist get his or her work done,” according to Akhtari — Silicon Genetics is finding that selling into larger commercial firms requires the “top down” approach of selling to IT directors and CEOs. While continuing on this path will require a bit more scale-up in the company’s sales force, Akhtari said it has already begun to pay off, with “several major companies” standardizing on the company’s enterprise solution.

The second part of the company’s strategy for future growth involves launching a new series of products — a goal that will require the company to stay ahead of the technology curve just as it did with GeneSpring five years ago.

Akhtari did not disclose any details on the project Conway has cloistered himself away to develop, but noted, “we have a close relationship with our customer base and we know what they will need over the next couple of years."

This week, the company is releasing new versions of GeneSpring and GeNet — versions 5.1 and 3.1, respectively. GeneSpring has been upgraded to include a visual scripted editor that allows users to automate analytical tasks using drag-and-drop icons. GeNet, meanwhile, includes a sample loader to automate database population, along with a remote computation feature so users can offload computationally intensive tasks from the central GeNet server onto other servers or desktop machines. In addition, the new release includes a DVD containing curated information on over 6,300 samples aggregated from several public domain gene expression databases.

Well aware that the playing field for gene expression analysis software has grown much more crowded than it was in 1998, Silicon Genetics is optimistic that it can keep at least a few steps ahead of its competitors in the market. “Most software companies in our space are suffering from indigestion rather than starvation. Staying focused is important to us,” Akhtari said.

And if all else fails, the company can always change its name to “GeneSpring.”

— BT

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