How Two Computer Consulting Techies Made Millions In Sales
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.Company: TeamAlliance Technology Partners Inc.
.Founders: Mordy Levine and Richard Harmon
.Type Of Business: Technology Placement/Software Development
.Location: Purchase, NY
.Year Started: 1994
.Start-Up Cost: $30,000
.Source Of Start-Up Capital: Personal Savings
.Advertising: Word of mouth
.Recent Sales:$12 Million
RICHARD HARMON AND Mordy Levine are ecstatic. It's a bleak and rainy October morning and the gong in the bullpen, where two dozen placement specialists are seated, has already sounded five times. Every time the big brass gong rings, it signals the placement for another technologist in some company somewhere in the United States.
To Harmon, 39, and his partner, Levine, 37, the resounding gong is music to their ears, not to mention money in their pockets. It means they're broadening their bottom line and growing more successful. As for the gong, the partners made a vow when they purchased it to bang it only when placements are made.
Together, Harmon and Levine run Purchase, New York-based TeamAlliance Technology Partners Inc., a brash new company that promises to solve any technology client's problem. And judging by the frequency of gongs on any given day, they're solving plenty.
They're expanding aggressively, with offices across the United States, and last year they chalked up sales of $12 million-remarkable, considering the fledgling company was only launched in 1994. Satisfied customers range from tiny three-person shops to Fortune 500 companies like Pepsi, American Express and The Associated Press.
Harmon describes TeamAlliance as a one-stop technology superstore. "There is so much technology out there, it's easy to see why companies are overwhelmed," he explains. "Some firms know they need a computer and accompanying software, but don't have the foggiest idea what to buy. Others need technical professionals to come in and show them how to manage the systems they do have."
"There are some businesses that need software designed to monitor a critical business function like bookkeeping, payroll or sales," Levine adds.
TeamAlliance covers all the technological bases to handle these tasks and more. According to these two entrepreneurs, it's perfectly logical. "The nucleus of our business revolves around technology," says Harmon.
If a company needs an experienced systems analyst for six months, TeamAlliance functions as a temp service firm. If a major corporation needs two full-time programmers, TeamAlliance puts on its alternate headhunter hat. And, if the same company needs a new bookkeeping program to track overseas sales, Harmon and Levine provide the software design talent to get that job done, too.
A Fateful Meeting
The seeds for the business were already planted by the time Harmon and Levine met in 1988 in a karate class in New York City. Passionate devotees of the ancient discipline, both men hold black belts. What's more, they both have strong backgrounds in finance and computer software development. Harmon has a B.S. in business administration from the University of Southern California. Levine has a B.A. in economics from Brandeis University in Boston and an M.B.A. in finance and accounting from the University of Chicago's Graduate School of Business. Both men had built careers as software development consultants-Harmon on the West Coast, Levine on the East. Harmon worked as an independent systems consultant, designing financial systems for large engineering companies, while Levine was a software development consultant to a range of Fortune 500 companies.
But it wasn't until 1993 that their professional relationship began, when Harmon formed Intertech Inc., a consortium of 60 computer consultants based in New York City, and Levine became treasurer. "It was a loose association of technologists that was set up to place senior technologists in high-level software development projects," says Levine. "We realized there was strength in numbers. Because of our mutual contacts, we could find high-level software development projects, place the right person and charge a fee for the placement."
While consortium members used it as a springboard to find software development projects and full-time jobs, Harmon and Levine stumbled on to a bigger, ultimately more profitable niche-placing full-time and temporary technologists.
By working closely with clients, Harmon and Levine discovered companies had basic needs other than just finding high-priced software designers for expensive projects. "Every day, we were getting calls from human resources people asking if we a had a programmer with 5 to 10 years experience or an experienced senior analyst to work either full-time or on a limited-time project," says Levine.
On the flip side, they were overwhelmed with complaints from their colleagues about headhunters and temp service firms. "Practically all the technologists complained about being herded by headhunters," says Levine. "More often than not, they were sent on interviews for which they were either over- or under-qualified because the headhunter had no idea what the job entailed. Not only is that a waste of an applicant's time, it can also be a humiliating experience."
Talk about being in the right place at the right time. It didn't take the partners long to experience an entrepreneurial epiphany. "We realized we were in an ideal situation," Harmon continues. "We had tremendous empathy for the candidates as well as the company project mangers searching for talent. We knew plenty of technologists who were constantly looking for new work. And, after working on complicated software development projects, we saw placement as an easy business to get into."
In March, 1994, Harmon and Levine launched TeamAlliance. Each put up $15,000 out of his personal savings to lease a tiny office in the World Trade Center in New York's bustling financial district. With two desks, one phone and a laptop computer, they opened for business.
Levine chuckles when he recalls their meager start. "We swore we knew what we were doing," he says. But after hardly three weeks in business, they discovered they were underequipped and understaffed. Because they had plenty of contacts and potential clients-not to mention a blue-chip stable of technologists ready for assignments-they started making placements immediately. "But we were just two people handling two phone lines, and we didn't have the manpower or equipment to get the work done," says Harmon. "We were overwhelmed."
By starting at the crack of dawn and working until 10 or 11 p.m. every night, Harmon and Levine survived the deluge of calls, placing 100 people in their first month of business.
"We had no choice but to figure things out quickly," says Levine. "Every day, we got a little bit better." The placements rolled in at a feverish pitch. By the end of their first year, sales were just under $2 million.
During that first year, the two men learned to work together and play off each other's strengths. While they have a great deal in common, their personalities are very different. Harmon is chatty, outgoing and can't seem to spit out his thoughts fast enough. Levine, on the other hand, is laid-back and reserved. Yet both place the differences between them among the firm's strongest assets.
"I tend to focus on the big picture, what's ahead and how to get there," Harmon explains, "whereas Mordy is the precise operations and detail person who figures out the best way to get there.
"During that tough first year in business, we worked seven days a week and lived and breathed the business 24 hours a day," Levine observes. "Until we could afford to hire others, we had to totally depend on each other."
By January 1995 they had amassed an impressive database of applicants and clients and began opening offices around the country.
Tomorrow And Beyond
Today, they boast 30 offices, employing 300 consultants-60 to 70 percent of them temporary workers. Levine estimates that 75 percent of their revenues come from temporary placements, while the rest come from full-time placements and software development projects.
The partners say the reason they're successful is because they've kept TeamAlliance focused. "We understand technology and don't intend to stray from it," Harmon says. "We've seen too many companies go down the tube because they get sidetracked. We're just sticking with what we do best." Levine adds, "We're technologists placing technologists. People appreciate that we're specialists."
The future? One thing is certain, asserts Harmon: "We're not going to get sloppy by letting success go to our heads." Both are aware of the fact they're being watched. Success breeds imitators who are waiting to pounce if Harmon and Levine slacken their pace. But that's not about to happen, say the partners. "We've worked too hard to get this far. We're not going to let anything stop us," says Levine.
"What's more," adds Harmon, "we're having the time of our lives." Reason enough to play the game for all it's worth.
Bob Weinstein is a frequent contributor to national magazines.
For More Information...
Team Alliance, 100 Manhattanville Rd., Purchase, NY 10577, (914) 251-3300.