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Branham300 Executive Interview - Donovan Jones, President, CEO and Director, CounterPath

Monday, April 23, 2012

Donovan Jones, CounterPathFor the past 20 years, Branham has tracked the Canadian ICT Industry and the leading companies that comprise it. As part of Branham’s ongoing efforts, we speak with leading executives from across Canada to gather first-hand insight on current trends and recent developments within the Canadian Technology space. Recently, Branham sat down with Donovan Jones, President, CEO and Director at CounterPath to talk about his career, the company and what the future has in store. The following statements summarize some of the key points that Mr. Jones would like to pass along to the Branham300 community. 

From an MBA to Big Business to Innovative Up and Comer…

The current phase of my career began with an MBA at the University of Calgary. Interestingly enough, the MBA program that I took was focused on entrepreneurship and entrepreneurial approaches to business. In addition to the typical finance, marketing and strategy curriculum of an MBA program, there was a specific focus on helping start-ups and small businesses achieve their objectives, whether it was a need for venture financing, improving operations or strategy or a variety of other elements.

After completing my masters I took a bit of a vector and joined TELUS in their corporate strategy group. Up to that point I had been very focused on entrepreneurship and was looking to either start my own business or help grow an existing business, but based on the opportunity and the team at TELUS I thought it might be a good idea to get some experience in a large organization, and TELUS is just that, being one of the largest employers in Western Canada.

What really intrigued me about TELUS at the time was that the telecommunications industry was going through a period of change and the strategy development group was looking at doing some really interesting projects including a number of transactions in addition to the merger with BC Tel. They were also very focused on growing their business, especially in the areas of data, IP and wireless.

I spent a few years in the strategy development group, and then moved within the overall corporate development group to become more focused on mergers and acquisitions. This was a great time in my career because I was involved in a number of key transactions for TELUS which directly leveraged many of the technical elements of my business degree.

From there, I moved over to a marketing and operations role involved with the selling, deployment and management of data and IP systems for enterprises. I then left TELUS and joined a small investment banking group focused on mid-market private transactions. I wasn’t with this investment firm for too long before a person I worked with very closely at TELUS introduced me to the CounterPath team, which at that time was called Xten Networks.

After meeting the team at Xten and learning more about their business, I really thought that I could combine my eight-year background at TELUS with my MBA focused on entrepreneurship and help this young company. So I made the shift and joined the CounterPath team and I haven’t looked back since.

Broadening CounterPath’s Vision to Address New Markets…

At the time I joined the company, it was almost exclusively focused on building SIP softphones for PCs and the vision was to be the leader in this field. Back then, people weren’t thinking about using their mobile devices to make phone calls over Wi-Fi or carrier networks using data, like we do today. By focusing on delivering these solutions to customers and identifying their needs and requirements, we began to see that an opportunity existed for a company that could build a software application that did voice, video and text that could work seamlessly on any device on any network. So over the past seven years or so, we have taken that original vision and expanded it beyond the PC. We’ve moved beyond those early days when our desktop applications were only Windows-based to now be operational on Linux and the Mac’s OS; with the growth in Apple this has been a very strong element of our proposition. We’ve also been one of the leaders in the shift to mobile, and our applications are currently available on the iPhone, iPad as well as Android powered smart phones. We’re launching an application for Android-powered tablets soon too, so that’s definitely something to look out for. I would expect to see other mobile OS’s added to the portfolio as Windows 8 and RIM open up to third party developers.

We’ve also changed our customer focus. A few years back, we were largely selling our solutions over the Internet. Now we’re really focused on big tier carriers, enterprises and OEMs. This pivot was a significant one for us, because we are now dealing with the Ericsson’s, the Avaya’s, the Rogers Communications’, and the AT&T’s of the world, and not just individual end users.

Key Drivers to CounterPath’s Current and Future Success…

From the outside looking in, it looks like CounterPath really turned things around starting in 2011, but the keys to our current success really go back a bit further than that. It really goes back to when we made the shift to focusing on customers like Mitel and Cisco on the OEM side, and British Telecom and AT&T on the carrier side. Once we aligned the team to sell and deliver to these companies, and build a business around them, the momentum really picked up because we took what we learned in one geographic market and applied it to another market. There were similarities in what we were doing with the large operators, enterprises and OEMs, so we’ve really began to scale our business in the past couple years.

Another big part of our growth, at least in the tail-end of our fiscal 2011 year and into 2012, is our expanded focus on mobile devices. People are finally truly understanding the benefits of using a mobile device to extend their office number to their mobile or using their mobile device on Wi-Fi or 3G networks as opposed to wireless voice networks, because there are real cost savings associated with this. Research has shown that 40% of all mobile phone calls take place within an office, which has a Wi-Fi or at least a 3G data connection. By switching to our technology, users can avoid needless charges and make those calls using low cost connections like Wi-Fi or 3G networks as opposed to more traditional means.

Another area for us moving forward where I think you will see some growth is in the enterprise space. Companies are really seeing the advantages of shifting away from the traditional desktop phone, to using our softphone technology on some other device, whether that device is a computer, a smart phone, or an iPad. CounterPath has a staff of over 100 people, and we don’t have any hard phones. When I am at my desk, I am talking on my Mac Book Pro. When I am in the boardroom, I am talking on my iPad. When I am on vacation, I am talking on my iPhone. With the Bria softphone application, which is one of CounterPath’s core offerings, I think a lot of other companies will see the value in this technology and make the shift so the enterprise market is going to be big for us too.

The Challenges of Growing the Business…

It’s definitely challenging for any company to go from a small company to a medium-sized organization, or a medium-sized organization to a large enterprise. We are experiencing these challenges as we make the shift ourselves here at CounterPath. For us, the core areas we are focused on are broad communication and strong processes.

When we first started out, I knew everybody’s name and was involved in most of the hiring. As you start to grow and expand, the same people that helped establish the company can’t be as involved in day-to-day decisions because there are other priorities. The management team here at CounterPath is definitely adjusting to this challenge right now, and I think we’re doing a great job.

We’ve been working really hard as a team to make sure that the control processes are in place so that as we grow, we don’t lose control of the elements that are critical to our company. Things like maintaining our culture, hiring the right people, and making sure that everyone in the company has a voice. Each of these elements and many others are essential to maintaining the passion that is evident within this company. We want to make sure that our team does the right work, the right kind of way, and that’s a focus we’re going to maintain going forward.

Positioning CounterPath for the Next Wave…

We’ve been in this business since 2003, so we definitely have the technical ability in-house that’s needed to excel in this space. We have over 70 developers internally right now all building SIP applications that work on any device, and on any network, and we have one of the largest SIP software development teams in our space.

We’re also really well positioned from a technical standpoint, including having more than 20 patents either granted or in progress. All of our solutions are highly interoperable meaning they work on so many different networks and servers. We’ve had more than 10 million downloads of our applications. That’s a really big number and we’re really proud of that because we have been able to make these applications work in all corners of the world.

We’ve also taken these technical abilities and applied them to the mobile space, which is exploding right now, especially with all of the pressure that carriers are feeling from over-the-top providers like Skype and Google, and even Apple itself with its Facetime offering. Because of the pressure from these over-the-top providers, we’re now seeing carriers look to companies that can build and deliver applications that can compete with these over-the-top applications.

The beauty of all this is we’ve already delivered our desktop applications to a number of major carriers – Verizon, Rogers Communications, AT&T, British Telecom and many others – so we’re really well positioned and ready for this shift to mobile applications and taking advantage of the number of mobile devices we use every day. Actually, this market evolution has already begun, and we have already made a major announcement in this area with our partnership with Rogers Communications and its new Rogers One Number offering.

I think you’ll see a lot more deals like this one with other carriers in the near future as carriers continue to look for ways to fight back against the Skype’s and the Google’s of the world. Users have so many options available to them now, so carriers need to remain relevant to their user base and introducing offerings like these are definitely in-line with current consumer demands.

We’re really at a tipping point in this market, and I am confident that CounterPath is really well positioned to capitalize on this next wave.

Key Advice from a Seasoned Tech Executive…

Have a plan.

I know it sounds simple, but a lot of people don’t put the little things in place to make the big things happen. Whether it’s your career, your company or even your life, think about what the best outcome looks like for you or your business, and then work backwards to where things are today. If you don’t have a plan, you will never end up where you want to go.


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