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Sunday, Jul 21, 2024

ITCM Acquires Value Logic

TECH: Adds Manufacturing Cos. to Client Base

SAN DIEGO – The technology solution provider ITCM has acquired Carlsbad-based Value Logic, Inc. in a move CEO Jorge Ruiz de Castilla said will significantly expand the company’s revenue, its client base and services to existing customers.

Value Logic is the fourth managed service provider (MSP) to be acquired by ITCM (Information Technology Consulting and Management) since Ruiz de Castilla took over the company in 2005.

Originally founded in 1985 as Chip Merchant, ITCM provides a variety of services for about 130 clients, representing up to 3,000 users.

Jorge Ruiz de Castilla

“Our job really is to manage, support and monitor day to day the technology infrastructure for our clients,” Ruiz de Castilla said. “If you have an issue with your computer, the software, your printer, all of the above, we’re just a phone call away. If we can’t do that we drive over to your facility and make sure you’re up and running as fast as we can.”

ITCM also manages cyber security needs and its clients’ vendors.

“There’s nothing more frustrating than if you’re a user or someone trying to work and you can’t connect because Cox, or whoever your provider is, is having problems,” he said. “We take care of that so you just get to do your job.”

Adding Manufacturing Clients

ITCM will be able to expand its services to include manufacturing clients through the acquisition of Value Logic, which had been working with an Integrated Quality Management System (IQMS), an enterprise resource planning software for automotive, medical, packaging, consumer goods, aerospace, defense and other manufacturing industries.

“That is one of the things that was interesting to us,” Ruiz de Castilla said. “They have specific knowledge and experience with IQMS and the manufacturing vertical, so that gives us a little bit of an edge and allows us to help some other clients and prospects that Value Logic has already been working with.”

Ruiz de Castilla anticipates that the acquisition immediately increases its revenue by 40%, a larger bump than any of the prior acquisitions. The increased profit will allow the company to pass along a better price to its clients, he said.

Value Logic offered more than just new technology and greater revenue, he added.
“What we look for in a company to acquire is a few things,” Ruiz de Castilla said. “A couple that are very key are culture and value. We have to be aligned. For me it was a shoe in.

I’ve known the owner now for three years, and the employees have similar values as we do. As long as everyone functions under a similar set of values and wants the same thing, then the team can really mesh well when we put them together. I’ve had the opposite in the past and that’s not fun.”

ITCM gained three of the company’s five employees and about 17 clients, which Ruiz de Castilla described as good-sized with between 600 to 800 employees.

“Hires have been important to continue to strengthen how we operate,” he said. “Our service team, for example, are on a first-name basis with their clients.”

Right Move at Right Time

The acquisition came at a good time for both companies, Ruiz de Castilla said.
“We were ramping up people in specific positions that we needed with our growth expectations,” he said. “Value Logic was extremely thin but needed more people. Through the last few months before we completed the acquisition, they stopped that growth because they knew the acquisition was coming. Having the acquisition is complementary, and we’re balancing out now the resources that we have so we can do the job that we need to do for our clients.”

Hossein Rabiyan
Value Logic

Value Logic CEO Hossein Rabiyan also said the acquisition was a good match.

“We were drawn to ITCM’s deep understanding of IT, in addition to the company’s openness to new methods and ideas, respect for our team and knowledge base, and commitment to its customers,” he said.

Ruiz de Castilla said more growth and more acquisitions are in the company’s future, but he does not want to move too fast.

“I was reading an article on MSPs, and there was one particular one rolling up 20 MSPs in 18 months,” he said. “That sounds like insanity. You’re rolling up client after client, and clearly you can’t provide the same level of service.”

ITCM increased its sales team this year and Ruiz de Castilla predicts a 20% to 30% growth next year. The company acquired other MSPs in 2018, 2019 and 2021, and Ruiz de Castilla said he already is looking at others.

FOUNDED: 1985 as Chip Merchant
CEO: Jorge Ruiz de Castilla
BUSINESS: Technology solutions provider
REVENUE: $5 million
WEBSITE: https://www.itcm.co/
CONTACT: (858) 268-4774


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