Brokat Infosystems of Stuttgart, Germany, with 1,600 financial services customers worldwide, says it is working hard to build business in the United States.
Fresh from an initial public offering in September, the provider of Internet transaction and security software intends to use the $50 million in proceeds to "strengthen our international expansion," said Stefan Rover, 33, founder and chief executive officer.
The United States is a primary focus. Brokat opened a U.S. headquarters in Atlanta last February. The five-year-old company employs 28 of its 270 people there or in regional offices in Boston, Chicago, New York, Phoenix, and Salt Lake City.
Despite the company's strong financials-revenues for the fiscal first quarter, which ended Sept. 30, jumped 49%, to $5.3 million-and international reputation, success in the United States may not be automatic.
"U.S. banks will look askance at a foreign vendor," said Octavio Marenzi, research director at Meridien Research, which recently ranked Brokat as having more software installed to support transactional Web sites than any other vendor in the world.
Brokat's main product, Twister, is middleware designed to integrate electronic banking, brokerage, insurance, government, and health care applications with legacy computer systems.
Banks can use it to retrieve information from back-end systems to serve customers via several channels, among them telephone, Internet, personal computer, or branches.
The company is also active in on-line credit card software, having enrolled in the MasterCard-Visa Secure Electronic Transaction certification program.
"Brokat has sound technology," said Mr. Marenzi. But "U.S. banks are slow to get out on the Internet. All the U.S. vendors in the Internet banking space are losing money."
Aware of the harsh environment, Brokat said it plans to sell its development tools to Internet banking vendors that could use them to build second-generation platforms.
Brokat recently announced, for example, it would market its Twister server software and other products to users of Sun Microsystems Inc.'s SunConnect open systems architecture. The two have just made a deal with a major Chinese bank.
Last month Brokat signed a joint marketing agreement with Hewlett- Packard Co. for marketing of Twister to financial institutions.
Brokat has also decided to concentrate on corporate cash management for now and will push into retail banking later.
"I think in the retail banking space, Brokat will find it a tough sell," Mr. Marenzi said. "But on the corporate electronic banking side, it can partner with other vendors to provide tools."
Brokat has allied itself with Transaction Software Technologies Inc. of Atlanta, a vendor with expertise and applications in cash management.
Brokat said it expects soon to announce the signing of a top-20 U.S. corporate cash management bank.
As yet, Brokat has no significant U.S. customer base, but Mr. Rover said he is optimistic. Besides Germany, Brokat has major operations in Singapore, Japan, Australia, and the United Kingdom.
"We have taken a very international, global approach," Mr. Rover said. "The race for leadership will be decided on a global basis."
