Mission: To build Absolute’s customer base and provide clientele with comprehensive visibility and control over their computing devices, any time, anywhere
Assets: Extensive business management experience in assembling corporate teams, technical know-how and a willingness to take risks
Yield: A 350-employee company that serves more than six million subscribers and has created a global embedded computer anti-theft standard with Dell, HP, Lenovo and other PC makers
By Nelson Bennett
In 1994, John Livingston was teaching small-business development at the British Columbia Institute of Technology (BCIT) when he was approached by a 21-year-old tech-preneur who needed help marketing a “phenomenal” idea.
Christian Cotichini and his partner Fraser Cain had started a company called Absolute Software (TSX: ABT), which produced an anti-theft program to track stolen computers.
It was a million-dollar idea that was missing just one thing: a million dollars.
“It was a phenomenal, big idea,” Livingston said. “Certainly a lot of technological risk, a lot of go-to-market risk – just a tonne of early risk – but a very unique idea.”
Cotichini was working out of a cheap apartment on Oak Street when Livingston met him and Cain.
“I was sleeping in the bedroom and working in the living room, and we had phone lines coming in through the wall illegally,” said Cotichini, who eventually left Absolute to found MAKE Technologies. (He remains a shareholder in the first company.)
Cotichini and Cain – who also left Absolute for other ventures – had the brilliance and zeal of youth, but needed someone with experience in business. Livingston had that in spades.
Born and raised in Vancouver, Livingston started buying, fixing and reselling cars when he was 16. At 18, he earned his commercial pilot’s licence, flew float planes for a few years, then quit that to move to Los Angeles to join a friend in the recording industry.
He later earned BA and MBA degrees from the universities of Guelph and Calgary, respectively, and developed an electronic travel reservation business during Expo 86. He ended up back in the music business and spent five years as a producer for a record label he co-founded before taking a teaching position at BCIT’s school of business.
“John brought a couple of things to the table,” Cotichini said. “First off, he brought the management experience to put a team together. He is good at putting the right team together. When I was at the helm, I didn’t understand that – I was too young. I thought the right team was me.”
But it wasn’t just experience and education. Livingston was tenacious and willing to take risks. He put up most of the company’s early money himself. He brought new investors on board, and the company grew – then hit a wall. Absolute was out of cash, and investors were getting nervous.
Heeding the advice of a business mentor, Cotichini stepped aside as CEO so Livingston could take the helm. A few years after Livingston became chairman and CEO, the company launched its initial public offering.
“We went public [on March 28, 2000] the day the market crashed,” Livingston said.
Despite a shaken confidence in high-tech stocks among investors, Absolute’s IPO raised more than $20 million. The dot-com crash eventually took its toll, however, and Absolute’s stock plummeted from $5 to $0.50 per share – and stayed there for five years.
“We called it Death Valley,” Livingston said.
By 2007, stocks hit a high of $40, split, and then dropped again when the 2009 recession hit. Share prices now hover in the $3 to $4 range – something Livingston takes in stride.
“You can’t let the stock price manage your emotions – you have to manage the business … and the stock market will take care of itself,” Livingston said. “It just does. Stock price always lags management.”
What really counts, he said, is how the business is doing in terms of revenue and growth. Absolute has grown steadily over 15 years, from three employees (Cotichini, Cain and Livingston) to 350 today.
The company now has six million subscribers and partnerships with 15 of the world’s leading computer manufacturers. In its 2010 annual financial report, Absolute reported revenue of $64 million – a 20% increase over 2009.
“We had an amazing string of growth from 2001 to 2008,” Livingston said. “We grew at about 70% compounded growth rate, which is very, very quickly. And then the last couple of years it’s been flat, in this economic environment, and now it’s returned to growth.”
The core of Absolute’s business is computer security and data retrieval. Its patented Computrace program is embedded in computers, and users subscribe to Absolute’s services. If the computer is stolen – or even if it is used for unapproved or illegal purposes within a company or organization – Absolute’s anti-theft squad can locate it and lock it up. The company can freeze and retrieve data from stolen or compromised computers and mobile devices and pinpoint their location using Google mapping technology.
About 85% of Absolute’s client base is made up of corporate customers and government organizations that have large numbers of computers and mobile devices (iPads, iPhones, etc.) The company also offers consumers an anti-theft program – LoJack – for personal laptops.
In 2009, Absolute acquired LANrev, which became Absolute Manage. More and more corporations, governments and public-sector institutions, like school districts, are using a wide range of computers and devices – including a mix of PCs and Macs, as well as iPads and iPhones. Absolute Manage allows IT departments to centralize the management of all these devices and improve their performance.
When it was launched, Absolute was not the only player offering anti-theft programs for computers, but it has emerged as the leader and has been expanding into Asia and Europe. Livingston said the efficacy of Absolute’s service is what keeps subscribers.
“We’ve had almost 15,000 recoveries, so there’s a lot of success stories in that.”