Spreading his assets keeps pioneer on track

Every now and then, one comes across a statistic that encapsulates what has happened to Chris Horn. Like last month, when the Brussels-based non-profit organisation Europe's 500 hailed his firm as one of the continent's leading entrepreneurial companies. In the last five years, Europe's 500 says, Iona Technologies' revenue has increased by 22,900 per cent, and its workforce has expanded over the same period by 8,300 per cent.

In the company's new offices in Ballsbridge, Mr Horn seems vaguely embarrassed by the hype. He is the same guy that started designing software in 1991 with two others in Trinity College, Dublin, but he admits that being at the helm of one of Ireland's most successful publicly-quoted companies means his job has changed somewhat.

For example, investor relations used to mean dealing with the administration department of the university, and maybe Forbairt. Now it is an essential element in Iona's approach to business.

"It's vital for us. We have a small but full-time team. And then I get wheeled out on at least a quarterly basis to meet investors; a day in New York, a day in Boston, a day in London, a day in Amsterdam," he says. "Our existing investors want to look me in the eyes and see what the body language is like, how confident or otherwise I am about the business, and compare that to the last time they met me. It's also an opportunity to meet new investors, who haven't heard the story before, and encourage them to take a look at us."

Last year, the share price of CBT Systems, another high-flying Irish technology company, plummeted from $60 (#51) to $6 in a week, even though it continued to make sizeable profits. Most observers said the share value had fallen because a huge number of US-based "momentum investors" had abandoned the stock as soon as they heard CBT's results would not match Wall Street's high expectations. Had CBT listed in Dublin as well as the Nasdaq, some analysts added, the investor base would have been broader, and the damage less.

Chris Horn watched CBT's trauma with sympathy and horror; the episode made him glad Iona had taken a different path after its own Nasdaq flotation.

"For us, the main reason for taking an Irish listing was precisely that, to try and broaden the investor base. Approximately 50 per cent of our float is held in Europe," he says. "We're now being covered by Goldman Sachs out of their London office, and I think that in addition to all of the Irish brokerage houses that we have, like Goodbody and ABN-Amro, the Goldman Sachs coverage is increasing European interest."

Other aspects of the business have been internationalised also, he adds, such as the workforce. More than half Iona's workers are now non-Irish, and this means that while the company newsletter is produced in Dublin, the jokes and banter have to be culturally accessible in Hong Kong, Perth, Munich, Paris or New York.

This is the way of the market, he says. Iona makes middleware - software that makes other programs work together - and its most popular product is called Orbix. Last year, the company unveiled a new, off-the-shelf version of Orbix, stepping up the competition between itself and two rivals. The new product now represents around 25 per cent of Iona's revenues; it meant a far heavier emphasis on sales, marketing and training, and more offices in more cities.

Since then, one of the competitors, Visigenics, has disappeared into Borland, which has changed its name to Inprise. But Iona still controls 30 per cent of middleware market, and is still expanding rapidly in Ireland and abroad.

This all forms part of a rapidly changing Republic, Mr Horn says, one in which both industry and the authorities must try to stay ahead of the game. He is chairman of the technology sector advisory group to the Tanaiste, Ms Harney, and the Minister for Education, Mr Martin.

The committee reckons there is a skills gap, in the computer industry alone, of around 2,200. It is also anxious that skills be developed across a range of support occupations.

He notes that high property prices, a poor public transport system and a substandard roads network are now a combined drag on the economy, dissuading both emigrants from returning and foreign workers from coming to the Republic.

"Here in our Dublin headquarters we have a number of people from outside the EU - South Africa, Australia, the US - and people think they are getting a great deal coming to Ireland, great pay and all the rest, and then they come and they say `Oh my God, I have to live that far out of the city? And I have to commute that much? And I get taxed this much?' In some senses the State has been superbly successful, but perhaps so much so that it got ahead of itself."

Where the Republic still has an advantage over other countries, he says, is in its size. It means that industrial strategists such as IDA Ireland and Enterprise Ireland have direct access to the political decision-makers, and can push change through fast.

"What I've heard from some of the multinationals who are here is that they feel it is incredible how responsive the State has been, compared to other economies, in seeing the problem emerge and trying to address it quickly," he says.

Meanwhile, he adds, technology itself marches on: "One of the things that has happened over the last two or three years is the strong growth of Java programming language and the use of Java technology. It was initially used in small projects, now it's being increasingly accepted as mainstream programming language. So we're putting more and more of our energies into Java."

Other developments - and Iona will try to run its middleware across all of these technologies - could include a new semi-conductor material said to be faster than silicon called gallium.

"Biotechnology - the convergence of that and computing. Optical computing, where you're using light for switching; laser-based transistors. People are looking to have the same idea around transistors and integrated circuits, but not necessarily based on just silicon anymore."

Over the next five years, Iona's revenue is unlikely to grow by another 22,900 per cent, but Mr Horn's life may have changed just as dramatically as it has since 1993.

(# - Euro)