By:
Lucianne Carneiro - PIB Magazine - London
Photo:
Davllym Dourado/Valor/Imagem

It´s not much more than a decade since Stefanini IT Solutions took the plunge and marched off into the global marketplace. Today, Brazil´s first Information Technology (IT) multinational has its sights set even higher - it aims to become a major international player. To this end the São Paulo-based company has put in motion an ambitious program to consolidate its foreign operations. The goal is boost foreign billings from a current 20% of group total to 50% through 2011. In 2007, the group billed US$ 200 million. To achieve this goal, Stefanini plans investing US$300 million through the next four years to acquire mid-sized companies. Part of this, estimated at US$200 million, will come from opening the company´s capital and floating shares on the stock exchange. Speaking with PIB from his London office, company founder and president Marco Stefanini explained that preparations were already under way and the float would happen some time this year: "The exact moment will be determined by the mood of the financial markets." A self-styled workaholic who loves races and reading - preferably history and biography - the 46-year-old businessman is a geology graduate who started the business in his home in 1987. International adventures date from 1996, when the first office outside Brazil was established in Buenos Aires. That was before most of his counterparts were even thinking of internationalization. Subsequent steps, however, were taken with care. At that moment the company´s top priority was building up its presence in Brazil by opening branches outside of the Rio-São Paulo axis. Internationalization was resumed four years later, in 2000, when offices were opened in Chile and Mexico. The following year saw Stefanini establishing beach-heads in Peru, Colombia and the United States, while the European campaign began in Spain in 2003, followed by Portugal (2004), Italy (2005) and the United Kingdom (2006).

Enemy territory

That was also the year when Stefanini opened an office in India, a step that could even be described as an "attack on enemy territory", given that Indians are leaders in the IT sector, responsible for 80% of global exports in software and information services. India´s IT exports totaled US$36 billion in 2007, a fabulous amount when compared to Brazil´s exports of a pitiful US$313 million. The company´s representative office in Hyderabad, which is still getting up to speed, is charged with servicing Stefanini´s global clients in Asia and also operates as an extension of the services offered by Stefanini in the United States. "With a strong base in Brazil, we now want to consolidate our position abroad where we have greater opportunities to grow," the founder said. The exclusively organic growth seen so far inside and outside Brazil will give way to a program of acquisitions of mid-sized IT service companies, ones that attend clients directly rather than subcontracting to other IT companies. In a first phase, Stefanini will buy companies using its own resources, but in a second phase the idea is to use capital raised by offering shares on the stock market. This would allow Stefanini to negotiate with larger companies. The buying spree will be restricted to deals that can attract clients located at what Stefanini calls the "top of the pyramid". This includes the 500 largest corporations in the United States and the 100 largest in South America. "Our client profile is the larger company, and that makes the challenge much tougher," Stefanini said. Among the company´s global clients are groups such as Johnson & Johnson, Santander, HSBC and Dell, while Unilever and Alcoa are amongst clients served in South America.

Priorities

Stefanini will prioritize four main markets in this second drive onto the international stage: the United States, Mexico, the United Kingdom and Argentina, in that order. Uncertainties about the growth of the American economy may have caused consternation in global markets, but they have left Stefanini largely unworried. He sees the world´s largest IT market as one that offers his company enormous potential for international expansion. The group already has three US subsidiaries, in New York, Atlanta and Fort Lauderdale. "The American market looks good even when there´s a crisis," he said. "And after all, how many crises have we not weathered in Brazil?" As for the United Kingdom, it is one of the world´s main IT centers and the most developed in Europe. What´s more, the UK leads in finance, so thanks to the competitive financial sector in Brazil this is one of Stefanini´s specialties. The company opened its third Mexican office last year, and that country is now the group´s largest market outside of Brazil. The company is present in Mexico City, Monterrey and Querétaro. As for Argentina, it gains the status of a priority market thanks to its proximity to Brazil and the strong local economy, now growing for a sixth straight year.

Manpower

Of the group´s 5,000 employees, 700 are dedicated to serving overseas clients. Within this "international brigade", at least 450 are located in the company´s 18 foreign offices, spread through 12 countries. For Stefanini, the strategy of internationalization goes beyond simply boosting hard currency earnings. He believes it also produces gains back home in Brazil: "It´s difficult to quantify the impact, but the fact that we are a global company certainly increases our credibility and attracts more clients in the domestic market." In the same way, the internationalization strategy not only helps prepare better staff, but should generate an overall strengthening of the company, making it better placed to withstand the competition and fight off potential purchasers. "If the company has global strength, it becomes better placed to defend itself back home in the Brazilian market, given that in many tenders, the names of suppliers are decided outside of Brazil," he said.

Stefanini in Numbers

- Gross Billing in 2007

  Us$ 200 million

- Billings outside Brazil

  Us$ 40 million

- Total employees

  5,000

- Employees outside Brazil

  450

- Offices outside Brazil

  18

- Countries

  Argentina, United States, Spain,

  Mexico, The United Kingdom,

  India, Spain, Portugal, Colombia,

  Chile, Peru and Venezuela