Craig Dynes, senior vice president and CFO of enterprise-software company Pegasystems, generally feels removed from the daily news grind of corporate bankruptcy, layoffs, government bailouts, and criticism over how much executives of poorly performing firms receive in bonuses.
It has nothing to do with him. Indeed, Dynes tells CFO.com, he often wonders if he’s in “a parallel universe” when he steps into his office each day after listening to dire business news on his way to work.
Last month, Dynes was one of the few finance executives who had profitable financial results to relay and who was willing to provide earnings guidance for this year during the annual conference call with investors. His predictions came despite the fact, he said at the time, that “there is no escaping the news about current economic conditions. The continual news coverage of layoffs, stock market results, and doom and gloom is overwhelming.”
His company is in growth mode, with plans to boost its sales and marketing team this year, after expanding the group by 37 people in 2008. “We’re not in that sort of hunker-down, weather-the-storm environment,” he tells CFO.com. Pegasystems, a Cambridge, Mass.-based company that specializes in business process management solutions, recorded $212 million in revenue last year, an increase of 31 percent over the prior year.
Dynes predicts the company will pass the $250 million mark this year and collect a profit of at least $17 million, compared to the $11 million in net income realized in 2008. The 25-year-old company also managed to sign a record number of new license agreements in the fourth quarter, which bodes well for future revenue tied to its professional-services business. At the same time, Dynes acknowledges that 30 percent growth year over year won’t be a sustainable goal. It’s easy to “fall into the trap” of complacency, he says.
Dynes, who brought his mixed background of tech work and finance to Pegasystems three years ago, oversees both the finance and IT departments. His previous roles include CFO of software firm Demandware, CEO of Narad Networks, and CFO of SilverStream Software. He began his career at KPMG’s Canadian firm and later dabbled on the IT side, writing code for a startup software company, where he also did sales.
For now, Dynes attributes his current company’s near immunization from the U.S. economy’s ills to the fact that Pegasystems has managed to convince potential clients that its products can save them money — obviously a top-of-mind issue these days. The company automates business rules and policies, which can reduce the time it takes companies to complete their own customer deals, for instance, or streamline processes for giving certain clients incentives.
Some of the company’s revenue — which comes from software licenses, maintenance fees, and professional services — is predictable, such as its non-cancellable, five-year agreements, while the timing of the rest of it fluctuates, leading Dynes’ finance team to reforecast every month. Still, Dynes says changes to the company’s business model in recent years has given it “a higher rate of predictability that’s really helped in this economy.”