A Limerick-based company has secured a £2 million (€2.54 million) venture capital investment although it has yet to launch its first product. Neville Technology Group approached European venture capital company, 3i, before Christmas, and on the basis of Neville's management team and growth potential 3i took a 27 per cent stake in the company this week.
Neville will specialise in offering technology-based business training to large corporations in the areas of sales, management and finance. According to Mr Terry O'Brien, managing director of Neville, the company already has a number of major contracts lined up, as the technology is based on a generic model for staff training licensed from Xerox.
Focus groups of customers are currently being established within the information technology and financial services sectors. Mr O'Brien brings a lot of expertise to Neville having founded Mindware, the telecoms networking training company which sold to Gartner Group in 1996, for a figure thought to be around $2.5 million (€1.9 million).
It then became Gartner Learning, and was recently bought by NetG, an online training company that operates in the same market Neville is now targeting.
Mr O'Brien said initial approaches to Irish venture capital companies proved fruitless late last year. At the time he was seeking £4 million to value the company at around £10 million in exchange for a 40 per cent stake.
"We then scaled back on the amount we wanted to sell. We believe this initial capital will help to increase our value substantially within the next few months."
Neville will use the new investment to expand its business in its key target market of the US. It is currently in the process of opening offices in San Jose, New York and London. Recruitment is under way in the US to employ eight sales people there by the end of the year, with plans to increase this force to 20 next year.
Neville in Limerick currently employs 17 people, and Mr O'Brien says he expects this figure to double this year, and reach the 60 mark next year. He projects first-year revenues for Neville of around $1 million, increasing to between $6 million and $7 million the following year. He expects the new venture to become profitable mid-1999.
"In terms of developing an exciting product in this area I believe we have the best management team around, and that is up against CBT, NetG and Global Knowledge Network. What we have to offer is better than what's currently available," Mr O'Brien said.
The Neville software will be loaded primarily on corporate intranets, and payment will be arranged on a three-year subscription basis. The training packages are largely based on generic sales and management principles, but can be customised to match each client's requirements.
"Once we met the team and agreed that we could work together it was inevitable that the investment would be made. This is an exciting opportunity for the company in a challenging and rapidly moving industry," said Mr Stewart Licudi, a 3i investment executive.
Mr O'Brien says he plans to stay at the Neville helm until the company is converted either through a trade sale or a stock market listing. He no longer believes the US Nasdaq technology exchange is such an attractive option, preferring more stable listings in Dublin and Europe.
