Around 4,000 employees, a turnover of 400 million euros and a 40 million euro profit. These are the figures that characterize Aricoma today. And also the number 10. This is the number of companies in the holding that cover the various IT needs of private companies and state administration. That they are succeeding in this is evidenced by the fact that the holding has grown from a thousand employees and a profit of CZK 150 million in just five years.
That's a real leap. Is there some kind of spreadsheet on sustainable corporate growth?
No such spreadsheet exists. However, there are a lot of companies that are overheating, so to speak, and we’re resisting that, so for us growth is not a mantra at any cost. We prefer to do things well rather than quickly.
Growth is not a mantra, but it has happened. How would you evaluate it if you’d known it at the beginning, when you were building the holding?
I think it's pretty much what we imagined. It's also a question of the opportunities that exist in the market. There are times when acquisitions fail as there are simply no opportunities, and then there are times when they succeed, because opportunities present themselves. There is no logic behind it, it's merely a matter of chance. In the acquisitions market, as it were, the dynamics are completely different in times of boom and crisis, and we firmly believe that we’re prepared for all these phases.
Even for the wild times we’re facing now? And what was the pandemic like for you?
It turned out that Covid had contradictory impacts on the economy, but it wasn’t as catastrophic as expected. It was pretty scary at times; some people weren’t affected by it, while helped others. However, we can say that Covid and the current geopolitical situation have thrown everything into disarray - what with the war, the problems in supply chains are getting worse and, according to various parameters, the economy is not looking good either. When you add high inflation to the mix, it makes for an unpleasant cocktail and no one knows what will come of it. That's why we're also staying alert. Although I don't normally share his views, on this I do agree with Elon Musk and his "super bad feeling about the economy", and I firmly believe I'm just looking on the bad side or I’m wrong.
Does this mean that you’ve changed your vision and plans in recent months?
No, we believe that our plans are robust enough and that, in short, if you do things right, you can get through the more dramatic situations. Plans are often made through scenarios. We don't do that, as there would be so many of them now that we'd be doing nothing more than creating scenarios and not doing business. We have one plan and one goal. For larger companies, a crisis is often an opportunity to strengthen their market position, and we firmly, albeit humbly, believe that this could be the case for us.
You want to build Aricoma's future on cybersecurity and cloud products, among others. Does the latter mean a move to a total "IT as a service" model?
These two themes are the two mega trends in IT that we’ve built Aricoma on from the very beginning. But no, not total IT as a service, as the cloud world is not nearly as simple as we all thought. Subscribing to Google Drive at home is great, but it can't work that way in the corporate world. It's much more complex than that, and our role as a systems integrator is to guide customers through this cloud jungle so that their business remains flexible, responds well to the competitive environment, and does so at a reasonable cost. The future is very colourful in this respect and this is a huge opportunity for us.
But what about the past? How did you come to start building a company with international ambitions?
The first steps were actually very mundane. In cooperation with our colleagues from AUTOCONT, which was the original foundation on which Aricoma was built, we wanted to rework it a bit and adapt it to future goals. We wanted AUTOCONT to have more power and scope, which we managed to achieve without the need for dramatic restructuring. We took it as a diamond in the rough that just needed to be cut, and then we packed in other companies on top of that. At the moment, we have a group of companies that we are very carefully and gradually connecting up. We don't want to implement a big bang strategy; this is about incremental changes that we communicate openly and truthfully, so that we all know why we’re doing this, for what purpose, and how it can benefit us. The aim is to create a platform into which we can "plug" new cells. We've learned a lot, but we're still not a unified company and probably won't be. We want to leave a certain amount of flexibility.
Are there any rules in place for that connection?
The key is that it's different every time, and that's where the fun lies, not to mention a little madness. If we try to apply some sort of corporate template then the acquisition often doesn't end well, so we consider very carefully how each company fits into our group and what integration plan we use for it. So far, we’ve managed to keep the number of people who have left a company after an acquisition to a bare minimum. We'd like to maintain this, as we always need the company as a whole, including the people who have worked to make it a success. The second thing is that we’ve been on the market for several years, and we take great care to protect our reputation as an investor. Of course, there are markets where we do not hold a position like we in the Czech Republic or in Scandinavia, such as in Germany. There, we’ve raised out profile a bit more by winning a tender for the European Commission, which is important because our goal is to have customers in Western Europe wherever possible.
Isn't it easier to have customers primarily in the East?
It is easier, but we don't want that.
Do you want to make Western money, or do you feel like you've made a name for yourselves in the West?
If you look closely, many reputable IT companies have set up branches in Eastern Europe and, other than global corporations, it can’t be said that any of them are particularly successful. Business in the East is more fragmented, more complicated. In Western Europe, on the other hand, the prices are stable and it’s a region we can read.
Let me return to the contract for the European Commission. Remind me, what was that all about?
We supply it with hyperconverged infrastructure and related services. We consider this the first step; we already have a branch there and we expect that this contract will be followed by others, such as in the field of computer security. We want to expand there, although it is not a trivial task. However, it is interesting for us from a financial perspective, and as a door to "good old Europe". This isn't just one supply; it's for 60 different offices. The European Commission works very professionally in IT; its individual offices have an allocated budget, it’s well organised and, basically, it’s good for us to be in on it.
Where are Aricoma's biggest international sales now?
To the European Commission, and to Switzerland and Scandinavia, which is linked to Seavus and Stratiteq. The priority markets for us now are Germany, Switzerland and Austria, and of course Scandinavia. There’s a little bit happening in the US as well, but realistically we’re nobody there; we’re competing with Indian companies and it’s tough. This may change, but it’s not a priority for us at the moment. However, business there is a huge school for us, and only the best really succeed.
There's a rumour in the industry that there is a shift away from using Indian suppliers who win mainly on price. Do you sense that too?
In this case, I would be extremely humble and cautious, as the idea that European experts are better than those from India or Asia is wrong. Indian companies and their people are excellent, but there are still downsides to working with them: distance, time and cultural differences. By this I’m not saying that Europe has a better culture, but there is a difference in the culture of doing business or communication, so yes, I am seeing a certain shift away from everything being automatically outsourced to India. This is good news for us, as doing European business in Europe has taken on a new dimension for European companies, too. Recently, there has been a shift away from globalisation and customers are tending more to seek someone closer to them. If we have a competitive offer, countries in Western Europe are looking more towards us and we believe that what we offer is competitive. We Czechs have a tendency to deeply underestimate ourselves; this is ingrained in our culture and won't change for a long time. Incidentally, however, this is something that we’ve been fighting against throughout the whole of the KKCG story. We need to be more self-confident, because we have reason to be.
Milan Sameš
Graduated from the Czech Technical University in Prague, with a degree in electronic computers and mathematical informatics. He is a member of the generation that "brought" computers to the Czech Republic. He has worked at Nokia Networks and LogicaCMG, among others. As CEO he headed the Czech Oracle and then the European side of Ness Technologies. He then founded his own company, truconneXion, where he is no longer active, as he has been the CEO of the Aricoma Group since 2018. Sameš is involved in the startup scene, acting as a mentor for nascent technology companies.
Aricoma Group
The Aricoma Group is currently the largest IT company in the former Czechoslovakia. It includes two major brands - Aricoma and Qinshift. It is now focusing on seeking new acquisitions in Germany, Austria, Switzerland and Scandinavia.