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Founder wills his way to success

From an early age, Sameer Penakalapati knew he had to rely on one thing to design his future: his own willpower.

Growing up humbly in Anantapur, India, his parents—both teachers—taught him the way to better himself was to hold himself accountable for his goals.

“If you’re a teacher’s kid, you have more pressure to be a good student,” Penakalapati says. “If you were late or you didn’t do your homework on time, they were the first ones to know. I didn’t want to get in trouble so (I strove to) constantly do better.”

His parents also helped him realize an education could help him accomplish any goal he set.

“My mom used to tell me that if you don’t do good in school, get good grades, you can’t change (your environment),” Penakalapati says. “That used to scare me. That’s probably one of the most driving forces for me. (Education is) the only way to do it. There’s no other way—you have this one small window.”

Penakalapati’s willpower has helped propel him beyond his wildest dreams.

He is the founder, president and CEO of Avani Technology Solutions Inc. The company provides software development, custom software and IT consulting services to clients worldwide.

The firm was recognized as one of Inc. magazine’s 500 fastest growing privately held companies in 2014. It has been on the Inc. 5000 list for two consecutive years. It ranked 18th on the Rochester Chamber 2016 Rochester Top 100 list.

This year Penakalapati expects the firm to reach $55 million to $60 million in revenues. The company has some 800 employees globally across 10 offices—in India and the U.S. Another 50 employees are expected to join the firm before 2018.
A start in India
Growing up, Penakalapati did not have the typical adolescent routine. Every morning he would rise before dawn to get milk for his family.

“We used to have bicycles. I pedaled a bicycle for a mile almost and a mile back at 4 a.m. in the morning; that was my routine,” he says.

That kind of discipline has shaped his business career, he says. As a youth, he spent time dreaming of what he would become, knowing he wanted to forge his own path.

“I always wanted to do something on my own, but also I knew that it was a distant reality then for me,” Penakalapati says. “We, as a family, (were near) the poverty line. We barely had food to eat. That was hard. So I always have this thing of, I need to do better, I can do better.”

Penakalapati attended Gulbarga University based in the city of Gulbarga in the state of  Karnataka in India. He graduated with a bachelor of engineering degree in 1993.

After school, he got a couple of jobs in the mechanical engineering field but found it was not for him.

“I didn’t like it,” Penakalapati says. “I was hoping to get into a graduate program. The graduate programs are expensive too.”

His goal was to get a full scholarship by doing well enough on an admittance exam. He studied for six months, living off a small allowance from his father.

“If I had to go to a movie, I’d skip the breakfast,” Penakalapati says. “It didn’t bother me. The good thing is I never had any regret for that stuff (living frugally); I enjoyed it. It’s a very finite time. You have six months to a year because I know at the end if I don’t have a job for six months to one year I know my dad is going to cut it off.

“There was a sense of urgency that I need to get into something.”

He achieved a high score on the exam, which enabled him to attend the Birla Institute of Technology & Science—one of the top graduate schools in India—with a good portion of his education paid for.

He earned his master of engineering degree there. He graduated in 1996. After school, he stayed close to home, working for a small information technology company.

In 1998 he landed a job at IBM Global Services in Bangalore, India, as a senior software engineer. The industry was ripe for programmers.

“They were hiring like crazy; it was Y2K,” Penakalapati says. “I was very excited about it. That was probably the best time—I had a lot of resources at my disposal to learn.”

“I think what I learned at IBM the most is how to work in teams,” Penakalapati says.

He was at IBM for one year before working as a consultant with a variety of clients starting in 1999.

His consulting jobs brought him to the U.S., where he traveled to a variety of cities, including Chicago and San Francisco. As part of his role as a consultant he became a project manager. He managed IT projects for Arthur Andersen Technology Solutions.

“I loved to travel then; it was fun,” Penakalapati says. “Anything that comes my way, I’ll take it—that was kind of my
attitude. When you came this far traveling from (India to the U.S.) it doesn’t matter; I could be anywhere.”

In 2001 he became a senior project manager at Tech Mahindra—formerly Mahindra Satyam—a Indian company that provides IT, networking technology products and business process outsourcing. He stayed in that role for over a year.

He went on to become vice president at Mascon Global Ltd. and remained in that role for nearly nine years. He was building his skill set and learning as much as he could in the various roles of his early career.

“I was mainly doing consulting jobs,” Penakalapati says. “The reason why I liked the consulting was you work on different projects for different clients. You’re learning things at a fast pace.”

Coming to Rochester
The company was a contractor for Eastman Kodak Co. and the job brought Penakalapati to Rochester. Kodak hired Mascon Global to provide application support services.

Penakalapati saw an interesting side of Kodak, he says.

“Kodak was going through a lot of changes then, and they were doing a lot of IT support applications through some of the system integrators, the IT services firms,” Penakalapati says. “I was one of the guys bidding for those contracts with Kodak for (Mascon).”

He continued his education in the role.

“I actually took the job for less money than I was making as a consultant because I wanted to learn the business, and I (was also) learning the sales process, and I was very keen on doing that,” Penakalapati says. “I used to help them in other accounts outside Rochester too. They didn’t ask me to do it. I always try to look for opportunities of what can I do and can’t I do. I was always under the impression that I can learn; it’s good for me.”

Throughout his various positions, Penakalapati has believed in the practice of pushing himself to do more and go above and beyond expectations. That internal drive has helped him from becoming complacent and helped him stand out.

“I think you’ve got to have a constant eye on what’s happening in the organization you work for; you constantly have to (re-evaluate) yourself to fit to the organization’s purpose,” Penakalapati says. “I’ve seen it—what happens is you get skills and you get into a job and you keep doing it one year, two years, three years, five years. After five years, the person who gets the same job as you as a junior, they can do your job for half the salary.

“The past loyalty doesn’t guarantee your future work. At the end of the day, it’s not a charity, it’s a business. It’s a for-profit business.”

By 2008, Penakalapati was starting to take stock of his business goals. He was closing in on a decade of working for Mascon Global and was burned out. His dream to create his own business remained.

“The firm that I used to work for, (there were) some problems, they were also putting a strain on me,” Penakalapati says. “Then I said, I think I have a pretty good idea how to run the business. I was pretty much running one-third of their business.”

Starting Avani
Avani Technology Solutions’ business operations launched in 2010. The company was focused on consulting and had seven staffers. It was born out of an idea that Penakalapati had regarding an unmet need in the marketplace.

“I wanted to build a product in the HR automation space,” Penakalapati says. “The products out there in the market were very expensive and many for big enterprises. What about small firms? What about midsize firms? (It was) some crazy idea I had.”

The business started out providing IT consulting services and by early 2012 it was adding products to its portfolio. In the early years, Penakalapati set out to secure a loan.

“I took my idea and met some bankers and they laughed at me: ‘Are you crazy? Show me the money, show me the revenue,’” Penakalapati says. “So I tried six months with different banks and then I realized … the route that I’m taking is not the one that I would ever get a dollar of a loan out of my dream. Your dream is yours; it’s not a bank’s.”

Cash flow was a constant challenge, especially in mid-2011. The firm had grown to $5.5 million in revenue but could not secure a larger loan.

“Money was a constant struggle because the cash flow—we pay employee salaries up front, before we collect the money from the customers, but employees don’t wait,” he says. “So I struggled with that; every payroll was a struggle.”

One banker—Achille Cavatassi at JPMorgan Chase —took a chance on Penakalapati’s vision and extended a credit line.

“He took a leap of faith,” Penakalapati says.

Growth surged to $7.5 million by 2013. Just last year the firm was close to $50 million in revenue. Penakalapati has set a companywide goal of reaching $100 million by 2020.

“Sameer is incredibly driven with a steadfast vision of growth for his company,” Cavatassi says. “A great example of Sameer’s drive and vision is the recent acquisition of Indotronix International Corp.—seeing that through took a tremendous amount of work and really reinforced Sameer’s dedication to the growth of Avani.

“The sky’s the limit. Avani has a goal of $100 million in revenue by 2020 and I’m confident they’ll reach it under Sameer’s leadership.”

In October, the firm acquired Poughkeepsie-based Indotronix International Corp.—a $22 million IT company provider—in a move that added 50 employees and dozens of Fortune 500 clients to Avani Technology Solutions. New clients included in the deal were Lockheed Martin Corp., Verizon Wireless Inc. and Deloitte LLP.

Avani plans to expand its current offering of IT consulting, expanding and enhancing its portfolio in areas of cloud-based products, IT security and government services.

In 2015 the firm purchased a 43,000-square-foot business park at 687 Lee Road, which is where the firm has its headquarters.
Mitch Meller, vice president of IT services at Avani, has known Penakalapati for over a decade. He has witnessed his career develop firsthand.

“Sameer builds good relationships with his employees and business associates,” he says. “He has an eye for good talent and gets the most out of the people he surrounds himself with.

“He does his homework, stays current with technology and makes quick decisions. Sameer is easy to work with, relaxed, friendly, supportive and at the same time demanding. He doesn’t lose sight of his objectives and makes sure all are aligned with company goals.”

Penakalapati sets the tone as a leader, says Ramesh Subramanian, director of technology solutions and account management. He has been working with Penakalapati for 14 years.

“He is a no-nonsense manager, a no-nonsense person,” Subramanian says. “He is a very street-smart manager and he will not differentiate between a developer or a CEO—he treats people the same way across the lines.

“He’s a very detail-oriented person and he’s very sharp with the numbers. Sameer gives you the freedom to fail, which is very rare. If I’m allowed to fail, I can do plenty of things in the world.”

Penakalapati is a big picture thinker but also recognizes how crucial small details can be. He also is a team player, says Penakalapati’s attorney, John Bansbach of Bansbach Zoghlin P.C.

“While he makes the final decisions, he is not afraid to consider views that may be inconsistent with his own,” he says. “He treats team members with respect. He has assembled a very capable, hard-working, loyal group of employees. He takes risks when he thinks that their magnitude and likelihood are outweighed by the rewards.”

The way leaders talk about their companies matters. When problems arise, it is best to keep them close to the vest, Penakalapati says. Positivity always helps matters.

“Business owners, if something happens, they talk all over the place to their employees, customers, bankers,” Penakalapati says.  “I always say, ‘shut your mouth; keep it with you, just deal with it.’ Let everybody focus on what they are currently doing. You’re sharing it with people who won’t help you solve the problem. You are actually just hurting yourself.”

Knowing how much education helped him become successful, Penakalapati has supported a school for orphans in India run by a nonprofit organization. He supports children in their basic needs and in their education. As Avani grows, he plans to continue to support children and give them an opportunity to move out of their situation.

Locally, Penakalapati has given back to the Rochester community by pledging $24,000 to support students at Edison Career & Technology High School.

Through the Pathways in Technology Early College High School program, or PTECH, Penakalapati has helped give area students a chance to see a future despite their difficult starting point. He also has given to the YMCA Youth Foundation.

To date across his philanthropic endeavors, Penakalapati has supported some 200 children.

“They’re smart; they just don’t have a stable base,” Penakalapati says. PTECH “really changes their lives. …Each one (is asked) what are their life’s goals.”

He also acts as a mentor at the University of Rochester’s Center for Entrepreneurship, where he helps students with their ideas.

While he did not know what he would do on his own, he always knew he could make his mark. Creating a successful company has come from creating a mindset of success.

“I’m always positive,” Penakalapati says. “Something happens that upsets me in the business or something bad happens, I generally come home and I don’t talk about it. If something good happens I’ll tell it all over. I grew up not having much, so I am notoriously hopeful.”

Sameer Penakalapati
Title: founder, president and CEO, Avani Technology Solutions Inc.
Age:  44
Education:  Bachelor of engineering degree, Gulbarga University, India, 1993;  master’s in engineering, Birla Institute of Technology & Science, India, 1996
Family: Wife, Sravanthi; sons Sushen, 14, and Shourya, 8
Residence:  Greece
Interests: Playing tennis, travel and history
Quote: “I’m always positive. Something happens that upsets me in the business or something bad happens, I generally come home and I don’t talk about it. If something good happens, I’ll tell it all over. I grew up not having much, so I am notoriously hopeful.”

3/24/2017 (c) 2017 Rochester Business Journal. To obtain permission to reprint this article, call 585-363-7269 or email madams@bridgetowermedia.com.

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