E-commerce is lagging in New Zealand, says SLI Systems co-founder and chief executive Shaun Ryan.
“Apart from Trade Me, there is not much happening. A lot of sites are just brochure ware.”
He notes that e-commerce is growing at 25% a year in the US and, in the UK is beginning to take off.
SLI Systems, based in Christchurch, provides software as a service that optimises key words in a site search. Most of its business is done in the US and UK, 75% and 15% respectively. Thus, its servers are housed in those countries, with development done in New Zealand.
The idea for a hosted site search came from Ryan’s brother Grant. “We prototyped it as Global Brain, then licensed it to NBCI, which is part of the US broadcaster NBC. That was their internet play in the dotcom days,” says Shaun Ryan.
“But after the crash, they closed the company, which was then employing 900 people. Five of us formed SLI and bought the technology back. At its peak, NBC was the sixth most visited site in the US.”
SLI was set up in August 2001. It was a hard time to raise money, Ryan recalls.
“Our first customer was Veritas Software. After September 11, people became more interested and we picked up a variety of customers.”
The company then began focusing its marketing efforts on e-commerce sites. Today, it has 250 customers.
The core software is written in C and C#, and the web-based reporting tools in PHP.
New Zealand customers include Dick Smith, Noel Leeming, Whitcoulls, and the Christchurch and Dunedin city councils. A deal with the UK Treasury was sufficient reference for New Zealand Statistics to buy the service.
Ryan says there is a glaring need for such software on a lot of New Zealand government sites, several of which he says are difficult to navigate.
He describes SLI as unique in New Zealand but with a lot of well-funded competitors overseas.
“That said, I think we have a long-term good business here.”
Till now, he says, development has been mainly customer driven. Now, SLI is looking to hire more senior developers. Fifteen of its 35 staff are developers.
In the year to June 30, the company posted an after-tax profit of $5 million, up to 25% of which it is putting back into sales and marketing. It has sales representatives in the UK, California, Florida and Boston.
“We’ve been cashflow positive and profitable for the past four years,” says Ryan.