Counting heads, 04/24/00

Counting heads

BY JULIE BORT
Network World, 04/24/00

Can't hire the talent you need? Buy it. That tactic landed Nstor Technologies and Excite@Home on top of the Network World 200 chart for employee growth in 1999. Through acquisitions, these companies expanded their workforces 669% and 311%, respectively.

Nstor, a small player in the storage-area network arena, wanted Andataco, a competitor, for its direct sales force. So the 26-employee firm bought the larger, roughly 200-employee company, keeping all but a few of the acquired people.

"We knew to gain a channel of distribution, we really needed an acquisition," says Larry Hemmerich, CEO at Nstor.

For Excite@Home, employee count went from 570 to 1,775. Obviously, the @Home merger in January 1999 accounted for a big chunk, about doubling the number of employees. But that was only the start, says Marc Ketzel, vice president of global human resources programs. The company completed another half-dozen acquisitions, each adding anywhere from five to several hundred people. "We pretty much kept 100% of acquired employees, with the exception of senior management," Ketzel says.

Along with bringing in new employees, the @Home merger increased the number of Excite's broadband customers from 300,000 to 1.1 million. Naturally, Excite@Home beefed up its customer support, engineering and sales departments, and added administration folk and content producers.

Interestingly, despite Nstor's and Excite@ Home's drastic expansions in 1999, neither is a model of solvency. Both continue to lose money on operations, despite growing revenue.

Related links

Contact Senior Editor Julie Bort

Nstor profile
From the NW200 database.

Excite@Home profile
From the NW200 database.

Net.business
More on the NW200. Network World, 4/24/00.

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