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The IPO Report

N-Soft Rings In
by
Tom Taulli
October 30, 1998

Tom Taulli is the publisher of the Taulli Report, an online investment site.  You can reach him at tom@taulli.com

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Technology start-ups from Europe don't appear all that often, because Europe lacks the venture capital infrastructure that exists in Silicon Valley. On top of that, Europe has stringent employment laws and heavy taxes. But that environment has not deterred Eric Messika and Roger Zini, who founded N-Soft in 1987 in Paris. Messika's expertise is in marketing, and Zini has a doctorate in computer science. Their first product was an interactive voice-recognition product, which is essentially an automated telephone answering system.

Since then, the company has introduced a variety of leading-edge telephony software products. Its latest product is called Etrog. Until now, much of N-Soft's business has developed through word-of-mouth, but that is set to change as the company aggressively invests in marketing.

One of the company's major goals is to boost sales in North America. The first step is establishing a subsidiary in the United States, known as N-Soft of North America, which is headed by Bob Manning. Manning has spent 25 years in the telecommunications industry, including seven years with call centers. His last stint was at Ameritech.

"When I saw the Etrog product," said Manning, "I knew this was a winner. This is a product I had been searching for that offers computer-telephony integration to small business, departments, and branch-office call center locations at a price point they can afford."

Manning has a three-tier strategy for marketing. First of all, to spread the N-Soft technology, the company will rely on existing VARs who market Etrog in their channels. N-Soft already has a premier client list that includes France Telecom, British Telecom, AT&T, Alcatel, and MCI WorldCom. Second, N-Soft is using systems integrators and consultants who will help companies install Etrog. Finally, N-Soft will engage in "awareness programs" that include magazine ads, trade shows, and public relations.

OK, So What's Etrog Anyway? The word "Etrog" has an interesting derivation. It is a citrus fruit used in a Jewish celebration and represents the heart, the place of understanding, as well as wisdom. Etrog the product is the heart of a call center, providing the understanding and wisdom to improve customer service through CTI connectivity. The Etrog suite includes the Etrog Agent, so an organization can use ActiveX controls to put telephony functionality on a user's desktop. For example, when there is a call, a "screen pop" will appear on the first ring and the agent can take the call, put it on hold, conference it, or transfer it. The Etrog Server is designed to bring host-based call-routing and analysis under the complete control of the call center, for effective routing of calls to the right department or call agent.

The Etrog Observer monitors all computer-telephony events from the PBX and application-level states to manage the availability status and statistical information on an agent or telephone extension. It is an excellent tool for measuring effectiveness. The Etrog Business Router is a simple, configurable host-based call router. It allows a call center manager to design the routing scheme for incoming calls. And finally, there are integration modules. To reduce the development time required to integrate desktop applications, project templates have been created for Outlook 97, Scopus, Versatility, and Microsoft Access-based applications.

"And the list will continue to grow," Manning says.

Etrog integrates the most advanced and open technologies, including ActiveX, ODBC, TCP/IP, and other industry standards. The software also works with the most popular PBXes from Nortel Networks, Lucent, and Alcatel.

Conclusion The CTI market is tremendous. According to Dataquest, there will be 1 million CTI installations and upgrades this year, a figure which is expected to grow at 27 percent per year for the next five years.

N-Soft is privately funded by its founders and employees. However, with the introduction of Etrog in the United States, N-Soft will be seeking venture capital to fund its expansion. Although there are other CTI solutions on the market, Etrog offers much functionality at a great price, which should make the company very attractive to venture capitalists.



For comments/questions, contact Tom Taulli at ttaulli@bpia.com.

Commercial: Readers interested in IPOs may want to check out The Investor's Guide To New Issues: How To Profit From Initial Public Offerings, available in our bookstore.

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