KarenSoft ready for Mesdaq listing, New Straits Times (Business Computing), Wednesday,October 2, 2002

KarenSoft ready for Mesdaq listing
New Straits Times (Business Computing), Wednesday,October 2, 2002

FROM a matter of necessity and of humble beginnings, KarenSoft Technology Bhd’s establishment is worthy of boast as it is enroute to a listing on the Malaysian Exchange of Securities Dealing and Automated Quotation (Mesdaq) Market next month.

The prospectus is expected to be issued on Oct 17, subject to Security Commision (SC)’s final clearance.

Founded in 1991 by Chee Chong Hwa, a chartered accountant, software engineer, and programmer, KarenSoft Technology Berhad is a Malaysian homegrown Netcentric group of companies providing ERP2 solutions in the Asia-Pacific region.

As of June this year, KarenSoft has a shareholders’ fund of RM6.6 million as compared with a paid-up share capital of RM3.9 million with institutional investors that include MSC Venture One Sdn Bhd.

So far, the company has received funding of about RM2.3 million from MSC Venture Corporation Sdn Bhd and RM1.2 million from an angel investor.

Chee, who is also executive chairman and chief executive officer of KarenSoft, hopes to raise RM10.55 million from the Mesdaq listing.

Chee: Hopes to boost KarenSoft's credibility and reputation with the listing.

The money raised will be used for expansion – local and overseas, marketing expenses, research and development (R&D) purchase of a head office building (Prai), additional working capital, and the listing expenses.

“We are hoping to boost the company’s credibility and reputation with the listing,” says Chee.

KarenSoft, which started off with only two employees in 1991, now employs more than 50 staff, out of which 75 per cent are technically-orientated.

KarenSoft’s strength is in its customer service, says Chee. “We have a record of 100 per cent success rate in implementation and our customer retention rate is 95 per cent. “We only lose customers through mergers or business closures,” he claims.

KarenSoft now has more than 250 customers in Malaysia. Out of that, 80 per cent of them are from the manufacturing sector and 15 per cent from the hospitality sector.

Already, the company has branches in Penang and Petaling Jaya with another branch set to open in Johor Baru by December and a Kuching office next year.

KarenSoft is also looking to expand to other countries like China, Middle East, and Central and Eastern Europe.


Business Model
KarenSoft’s current business model is based on direct sales via its regional offices in Prai, Penang and Petaling Jaya.

The model has proven to be effective as the company experienced an increase of 54 per cent in turnover from 2000 to 2001. From 2001 to 2002, it then experienced a 100 per cent growth in terms of revenue.

However, KarenSoft’s business strategy does not stop there. KarenSoft Institute of Technology (KIT), which was established in April of 2000, was set up to train KarenSoft’s products users, trainers and business partners known as Certified KarenSoft Solutions Providers (CKSP).

CKSPs are either system integrators or mid-sized accounting firms that are trained and certified with KarenSoft products before they are allowed to market, sell and implement KarenSoft ERP2. “At present, we have 12 CKSPs mainly located at areas where we do not have regional offices such as Kedah, Perak, Kelantan, Malacca, Federal Territory, Johor and Sabah,” informs Chee.


KarenSoft ERP2
KarenSoft ERP2(ERP+CRM) is a major enhancement over KarenSoft ERP2000 which was a finalist at both the 1999 Asia-Pacific IT & T Awards (Apmitta) and 1999 Pikom-Computimes IT Product of the Year.

The ERP2 is and all-inclusive e-business solution which comprises of sales distribution, materials requirement planning, logistics management, planning and production, financial accounting and fixed assets, human resources information, and customer relationship management.

With KarenSoft ERP2, the company is targeting the industrial and commercial sector such as manufacturing and healthcare.

"In Malaysia, we are positioning KarenSoft ERP2 for the SMI market to meet the challenges of Afta," says Chee.


By Woo Siew Chin