IT outsourcing firm Lumiqualis is new, but it has a pedigree going back over decades. The New York-based firm also has a unique social mission that goes along with “delivering quality execution delivered with authenticity and value.” So many firms are focused on very large enterprises, but medium sized and even small, high-growth businesses have IT needs, that can sometimes be quite complex.
Finance Colombia executive Editor Loren Moss was able to speak recently with two of the three co-founders of Lumiqualis, Chief Executive Officer Anthony Conte and Chief Technical Officer César Pérez (above, right).
The trio had a wide ranging conversation over the neglect that midmarket firms face, why Colombia, and especially Medellín is an attractive nearshore delivery location, and how a social mission is integral to their aim of being a profitable, thriving professional services firm.
Finance Colombia: I’m here with Cesar Perez and Anthony Conte and they are two of the three co-founders of Lumiqualis. It’s a new company, but you already have a pretty long pedigree in IT and in outsourcing services and technology. So maybe if you could give us a brief overview of how Lumiqualis came to be and what that name means?
Anthony Conte: So as you, as you mentioned, we definitely have long pedigrees. So, I’ve been working within the IT services consulting space for about 15 years now, and really where Lumiqualis came from was a situation that came up with our third partner, Mike Dershowitz. Mike is a bit of a serial entrepreneur. He’s the founder and CEO of a company called Fair Trade Outsourcing and a number of other properties, and I’ve been advising Mike for many years on FTO side. He had a situation with a vendor that he brought in to do some IT consulting, and the project essentially just went completely south and silent. He asked me to step in, help to unravel it and figure out what was going wrong. It was really not a salvageable situation. It was a company that was a group of very good engineers, but they weren’t put together in a way that had a good quality delivery process or even a company for that matter that really was running efficiently.
So they were a bit too loose to really put together a project and a delivery process. We eventually moved away from that company. Cesar was sort of tangentially connected to the project. He didn’t work for them, but he was doing some freelance work. So when we walked away from that situation, Mike, myself, Cesar, we sat down and we started talking about what went wrong, during a little bit of a post-mortem. And as we talked about our various backgrounds and similar experiences, we have the makings of a company that could come to market, help serve small to mid-sized businesses, like Mike’s companies, but do it in a way that brought a higher level of quality, a higher level of excellence to the process, because my years of experience of running various delivery organizations, years of experience on Cesar’s side, as far as running technical delivery, running technology projects, running technology teams, putting that together really created the exact workings for a company that could find and avoid these pitfalls that a lot of small midsize companies are facing.
“They need help. They need a good partner, someone that they can trust and rely on to not only deliver against their needs, but to also bring their team up to these technologies.”–Cesar Perez
If you look at the industry, as it grows, you’re seeing mass consolidation by big players, as there’s a constant quest to find good engineering, technical talent, but if you’re a small to mid-size, you’re not going to get the attentions of a Globant, Accenture or McKinsey or any of the big players, simply because they’re looking at enterprise deals, right? So, if you have a one-off project or if you’re a small or mid-sized company, there’s really nobody out there really focused on servicing it, or the ones that are out there are slowly being absorbed and consolidated up. So, we saw an opportunity to come in and really fill in that space and provide that level of quality. And that’s where our name comes from. So, Lumiqualis, Lumi is from luminaries. So, basically folks that are experts and driving a passion within a particular space; Qualis is actually Latin for quality. So, we were thinking of the quality aspects that we would embed in everything we do and put them together.
Finance Colombia: Luminary quality. I like that. You mentioned something interesting, and that is that your third partner has been involved with fair trade outsourcing, and that brings to mind—often people call it impact sourcing. And I know that you guys have opened up delivery operations in Colombia, and I’m interested in a couple of things. One I’m interested to hear about, why Colombia? Why did you settle on Colombia, of all the places you can go in the world? People have been going to India for a long time. Down here in Latin America, Costa Rica has been famous for a long time, but you guys chose Colombia. And I don’t think that that’s an odd choice. I know that there’s a lot of really cool things going on here about– within technology, but not being Colombians, how did you find out about what was happening down here and what guided your decision towards that? And then afterwards, I’d like to hear more about the impact sourcing, or the fair-trade sourcing component. I know that you guys have made some innovative hires and I don’t want to get into personnel or any individuals, but I reallywould like to hear about that philosophy.
Anthony Conte: So why Colombia? So, my last opportunity, my last company I worked for was mainly within Mexico, and I had begun working within the Latin American space. I was doing a lot of research on additional areas within Central and South America, where we could go to find good, strong engineering talent. And really, it’s a quest for talent. It’s a quest for good strong capabilities. And there’s a ton of opportunity. As you mentioned, within Latin America, we wanted to stay very much nearshore to start. We are looking at much more global resources, but we want to start with nearshore because we are servicing the North American market. And when you look at the different countries, the different opportunities, I mean, you mentioned some, Costa Rica was strong. Uruguay is strong. Argentina, obviously with has huge capabilities. Brazil is strong. So, there were a number of options. Mexico, don’t leave them off, but we were trying to find a place that was one, maybe not as competitive yet in the space.
So, Mexico, Argentina, heavy competition, basically, everybody’s there. Uruguay, Costa Rica, great talent, but small pools, so, you’re not going to have as much depth there. And, actually if you go to Costa Rica, the costs at this point in Costa Rica, it’s starting to rival some second and third tier cities here in the US. You lose some of the cost advantage benefits as well. And so when you really narrow it down, you know, the countries I started to really focus in on were Colombia, Brazil, Peru, and Argentina stayed in there. Economic situations in Argentina made it less desirable. Brazil is not a great place right now to try and go open up and do business. Peru is still young from an engineering capabilities perspective. And so that left Colombia, and what really made Colombia stand out was the focus on building the technology capabilities, especially in Medellin. And the fact that, you know, while Colombia is not perfect yet, but they seem to be moving in the right direction. So, they may do two steps forward one back. Everybody else seems to be going one step forward and two back. So, you know, it really looked like Colombia was on the path to really making this—a really strong, viable solution for building out a good technology team.
And when you blend in fair trade, one of the primary reasons I’m involved with them is because of the social impact missions and fair trade is more of a BPO, so that’s focusing on more cost centers and a slightly different skillset than Lumiqualis. However, that social mission is going to trickle over in a different way. You know, technologists right now don’t need help finding jobs and moving up socioeconomic ladders, because as a technologist right now in this world, you have a really strong opportunity. However, you want to work with a company that is going to help you foster them. And that’s where things like education, experimentation, things of that nature come into play, and that’s what we’re embedding within. Lumiqualis is that education concept of not just hiring folks with good technology talents, but how do we really tap the full potential they have? How do we really grow them as professionals? And also that will allow them to give back to the areas and communities where they operate.
And then as we grow, we want to build a broader philanthropic trend. I mean, we’re still small, so it’s hard for us to be fully altruistic because we have to first worry about survival as a full company and a startup. But it’s always in the back of our minds, you know, Cesar and I are always talking about ways that we can really utilize this model to give back. And, you know, some of the areas where…that’s where a country like Peru will be interesting because once we work out our model within Colombia, investing in education in other areas where maybe it’s not as developed will help bring up the technology capabilities. So, that’s our current mix on it right now. And then we will continue to think about other ways where we can bring a bit of that social mission to the table and think about how we can continue to make sure we’re good corporate citizens.
Finance Colombia: That’s really impressive. You mentioned a couple of things there. I mean, when you look at site selection, Uruguay, obviously as a country with a lot of talent, it’s a very small country, population-wise, a highly developed country. A lot of people like to call it the Switzerland of the Americas. But I know companies in Uruguay that have opened up outsourcing locations or delivery locations here in Colombia to serve the US and done very well. And part of it is that the cost and the lack of scalability that Uruguay has, it is a high, relatively speaking, a high-income country, and so incomes are high. And like you mentioned, in Costa Rica, Uruguay, places like that, you’re paying in some cases great talent, but you’re paying pretty much almost US rates higher than quite a few European countries I’ve seen. But the other thing, as people are looking to Colombia, and there are other countries that of course are doing some major things.
I had a conversation today with colleagues in Trinidad and Tobago, and they don’t have a lot of fame as a nearshore destination, but they’re working to change that. Jamaica has had success for call centers, but they’re trying to move up the value chain into IT. I was at, I mentioned earlier at Andicom last week, which is the biggest IT industry event in this part of the Americas, and the minister of Information and Communications Technologies announced an initiative to where any Colombian that wants to learn programming languages that will actually put in the work, the government is going to provide free classes to any and all Colombians who just sign up. And you can go, I guess, as far as you want to go with it and you have to put in the work and do your homework, but they’re at least providing the opportunity. And so the government knows that it is a priority and they see that.
And I think that the impact sourcing component of that, I think that people here are very aware of that and they see that as their opportunity to go from their status as a developing country, to the developed status, they know what they need to do. It’s great to export agricultural products and maybe textile products and things like that, that’s honorable work, but they also understand that to be…Colombia is now an OECD country and to really play at that level with their peers and be seen as a peer, they really need to…talent is the key. I mean, we look at it in micro level, when you have a company, talent is the key. At the macro level, when you have a country talent, the key, right? And that comes back to education and all these types of things.
You mentioned that Lumiqualis kind of has a sweet spot, because you mentioned a lot of these giant IT outsourcing companies are focused…everybody talks about the enterprise and that’s great. If you can go out there and get a giant project or engage in some 12-year, $3.2 billion contract to do digital transformation for the world’s largest bank, that’s great, but that leaves a lot of viable companies that need help. So, if you could give me an idea of what’s the sweet spot for Lumiqualis, and that’s to say: who should call Lumiqualis and why should they call you?
Anthony Conte: The one thing we don’t have is drastic scale. So, we can’t flip a switch and give you a hundred people tomorrow. So the projects that we are looking for are going to be probably companies, sub-1,000 employees that want to do projects that are three to six months and run $50,000 to $500,000 in costs. As a rough gauge, we’re not limiting ourselves across verticals at this point, because we’re too small to say we’re only going to work on particular verticals. Having said that, certain verticals could be challenging to us and require…if you think about heavy manufacturing, there could be complexities there that we may not be equipped to handle, so we’re trying to stay as general and as broad as possible.
The focus we have, and Cesar can elaborate even more on this, as far as our capabilities go: web, mobile application development, ranging in a broad range of capabilities within that space, we can attack for just about any customer that’s out there and in most of the verticals.
César Pérez: To your point, when we think of the web predominantly, I mean, for some organizations and not all, that’s like a hundred percent of their business anyway. And yes, so mobile applications, but predominantly everything’s on the web nowadays, so that’s why we are strategically focusing. Just from the beginning because again, there’s just a broad range of services and we have the expertise on hand and we’re scaling our team to provide those services. But also, I’ll segue into other parts of services and businesses that will become part of our evolution mostly in Devops, right? We’ve brought on somebody who is really a heavy hitter in that space, who has a lot of experience and expertise and we’re ready to provide that service.
I’ll bring up some real-world examples of things we’re dealing with today, and that’s when a given team has just sort of reached their capabilities, and they’ve been working on an older stack or internally they don’t have the skillset for what they need. They need help. They need a good partner, someone that they can trust and rely on to not only deliver against their needs, but to also bring their team up to these technologies. So, that’s basically where I would say we can be of help to any client.
Finance Colombia: When I was on the operational side of things, we had a client that got in trouble because they had an outsourcing team in the Philippines, and there are great operations in the Philippines, but they didn’t go and visit enough and do enough due diligence and supervision and ended up getting in very, very big trouble because that distance created that, versus being able to go to Newark or JFK and be on the next flight the same day and be here, and be back in a couple of days, if you need to. I’m sure that has a lot to do with it too.
Anthony Conte: Yes. And honestly when you think about some of the other countries in South America, Argentina, Uruguay, you’re getting into some serious travel. So, it’s very hard to reach them from the US and so if clients want to visit, or if we need to visit, that’s adding an additional layer of travel that makes those locations harder to reach. So that’s another kind of feather in the cap of Colombia as a destination as well.
César Pérez: The other thing I think we can add is if we circle back to that philanthropic or altruistic mission, that we want to build in social impact, as we build the base level of the organization, we build out our education programs. We want to quickly turn those and start building our own capabilities, if we can get the right training capability and the right senior folks in, we turn that out and start pumping out our own people, partnering with bootcamps, running our own bootcamps, having our own education programs. So that’s a big component of what we want to do, is build our own teams going forward as well. And that’s how you use technology to impact the locations where we operate. We’re not just going to hire engineers that are already experienced but starting to bring in some of our own and train them up.