The slump in air travel can only help RAW Communications, this year’s top performer. It transmits companies’ online video presentations to fund managers and should prosper in an environment where business travel has been cut sharply since the terrorist attacks of September 11.
RAW was founded in 1998 by three managers within Financial Times Electronic Publishing – Ab Banerjee, Christopher Holmes and Nick Edwards. The trio, who had previously launched a video-on- demand service for the Financial Times, came up with the idea of using the internet for virtual meetings between company executives and the investment community.
Banerjee, the chief executive, says fund managers will want to assess the quality of a management team before they make an investment. “But fund managers are often too busy to meet candidate companies face to face. That’s where we come in.”
RAW transmits video coverage of company announcements as well as morning meetings of brokerage house analysts as they brief trading floors on what to buy and sell. Initially, RAW found itself constrained by inadequate bandwidth at client sites, but it overcame this problem by installing its own servers in clients’ offices to ensure that presentations are seamless and not dogged by the unevenness of delivery so common in video conferencing.
The second constraint was the way fund managers worked. “I haven’t got time to watch television” was a frequent response when RAW tried to interest them in the new service. RAW won them over by offering indexed information so that a user could find the relevant few seconds of a presentation without delay.
The credibility and contacts of its founding team were also of great importance. RAW says it now has contracts with 65 of the world’s top 70 fund managers.
The London company raised a total of £20m in venture-capital funding from 3i, Intel and Providence Equity Partners. The cash has been used to expand overseas, opening offices in America, France, Germany and Hong Kong. The company now employs 100 staff.
Sales have rocketed 422% a year, from £112,000 in 1998 to £3m in 2000, when RAW reported significant losses. Sales are expected to double this year and the company, which claims to have £10m in the bank, believes it will break even by the end of next year.
As one analyst from a big American investment house wrote to Banerjee recently: “With research budgets slashed and business travel out for security reasons, RAW’s service has become a ‘need to have’, not a ‘nice to have’.”.
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