Tonight members of Ireland's corporate elite will gather at the Berkeley Court Hotel in Dublin to celebrate the human dynamos driving the Celtic Tiger economic boom. It will surprise no one that the award for Business & Finance Person of the Year is to be conferred on the man who created a mild sensation this month by steering the company he commands into the FTSE 100.
As a staunch Irish patriot - he has two small tricolours on his desk and a brass replica of the Proclamation of the Republic pinned above his office reception - Fran Rooney will revel in the applause of his compatriots while blithely skating over the fact that Baltimore Technologies has recently become, whisper it, a UK-registered company whose prime focus is now on the London Stock Exchange.
Its entry into the British corporate elite has been highly bumpy. Like most of the new FTSE entrants, Baltimore's shares have taken a battering since it joined the most exclusive index 10 days ago. Its stock was at £100 yesterday, almost one-third below last month's peak of around £137.50. It has also been sliding on the tech-laden US Nasdaq.
Baltimore provides the tools which ensure sensitive data and documents can be transmitted across the internet securely. No one is questioning the reliability of its software solutions, but its declining share price has placed a heavy question mark over just how secure an investment is this e-security specialist.
Mr Rooney, who played for Shamrock Rovers before managing the Irish women's soccer team for years, once likened Baltimore's transformation to that of a football club going straight from the third division to the Champion's League. He's become less fond of such football analogies, perhaps mindful of the fate of those clubs whose meteoric rise into the Premiership was painfully short-lived.
Still, if any embittered investors feel let down by its recent stockmarket performance, they can't blame Baltimore's boss, who has consistently sought to distinguish the company from get-rich-quick dot.com stocks. "We've always tried to be very transparent and honest with our shareholders," he says. "Last May we felt there was a lot of hype in the marketplace and we indicated that we considered expectations to be excessive. That initially had a negative effect on the share price."
But these are crazy times. Baltimore's stock soared by 115 percent last December, on the day it merged with Hampshire-based Zergo Holdings, another e-security concern, and went on rising into the new year. Analysts seem to agree this merger will give it the potential to become a global leader in the provision of e-security.
With the market for authentic systems expected to be more than $3.5bn by next year, they are also impressed by the strategic agreements Baltimore has struck with computer manufacturers such as Hewlett-Packard and Compaq to promote its products.
Baltimore's stratospheric ratings are solidly-based, says its supremo. "It is important to draw a distinction between us and other dot.com stocks," says Mr Rooney. "We already have customers, products and an infrastructure that we're delivering to the marketplace. We've no fear in saying our products are the best in the industry and will stand up to any test." He says Baltimore has $140m worth of business in the pipeline, winning 50 of the last 75 contracts it bid for.
Independent projections seem to agree that the worldwide e-commerce market will grow from $50bn in 1998 to $1.3 trillion by 2003. Security is a vital component in all e-commerce applications as governments, banks, telcos and large corporations try to establish secure, trusted electronic networks for their transactions.
Mr Rooney works out of Baltimore's "operational headquarters" in the basement of Dublin's International Financial Services Centre. But the company has outgrown that and is preparing to move to the banks of the River Liffey. Its corporate HQ switched to Basingstoke, Hampshire, in January when it merged with Zergo. It laso has regional headquarters in Boston and Sydney.
Mr Rooney commutes across the Irish Sea when he isn't jetting across the Atlantic or further afield. Stealing time for his favourite pastime - watching soccer matches in Dublin with his son David - is becoming increasingly difficult, but he is determined to remain super-fit. When he's in Dublin, he likes to start the week with an early morning jog through Phoenix Park, where Ireland's president and the US ambassador to Dublin have their official residences. He also works out regularly in the gym and has fallen in love with the game of golf.
Globe-trotting was factored in four years ago, when he embarked on his ultra-ambitious plan to build Baltimore into a global player in the provision of impenetrable security systems for e-commerce. He now has 21 international centres.
As he saw from the start, the need to send and verify electronic documents securely would have to be met in every part of the world to establish the trust essential for large-scale internet transactions. Mr Rooney says the company is evolving precisely in accordance with the growth plan he drew up three years ago. What no one could have forecast is its market capitalisation, which now stands at more than £3.6bn, a phenomenal figure considering its sales last year stood at just £23.3m and its losses widened to £31.4m.
"We could be profitable if we wanted to be but we made a very conscious decision to invest very significantly in global expansion," says Mr Rooney. "We see enormous growth potential. We're going through a new industrial revolution and we're providing something that will be absolutely essential. In the future you'll see our products everywhere." Baltimore may be providing the picks and shovels for the internet goldrush, but Mr Rooney prefers to speak in more elevated terms of the lucrative niche it is carving out in thenew economy.
The enterprise, he says, is catering for industries where trust is an integral part of every transaction, businesses that cannot afford even a momentary lapse in security. "The type of infrastructure projects we're developing are built to mission-critical standards. We're talking about the software that keeps a banking system going."
Baltimore's software has already been deployed by eight of the world's leading banks - including ABN-AMRO, Bank of America, Barclays, Chase Manhattan, Citigroup and Deutsche Bank - and looks well on the way to becoming the industry standard. To Fran Rooney, the ground is highly familiar, having worked in IT-related positions at the National Irish Bank, as well as several government departments and the Irish postal service. Although still only 43, he can point to almost 20 years of experience in the financial and information technology sectors.
He took evening classes to train as a chartered accountant and was fortunate to land the high-profile Dublin financier Dermot Desmond as a client. The brains behind Dublin's hugely successful International Financial Services Centre, Mr Desmond became a major investor in Baltimore after being persuaded there would be a growing requirement for certification and encryption technologies for transmitting documents electronically.
The company was started in 1976 by mildly entrepreneurial academics at Trinity College, Dublin. It was still a handful of people operating mainly as a consultancy in 1996 when Fran Rooney bought out the shareholders. The venture had been called Baltimore after the small coastal village in West Cork where the shareholders had held their inaugural meeting.
Mr Rooney swiftly recruited a senior management team to help him rapidly transform the company beyond recognition into a leading-edge developer of e-security systems. He decided against renaming the company, after talking to his team, reckoning Baltimore would have more credibility among potential investors and clients with a venture that had been around for two decades.
The name Baltimore (which most people assume stems from Maryland) should be of great benefit in the crucial American software market, which has been dominated up to now by Entrust and Verisign. The US is expected to account for 20 per cent of its sales this year compared to just 5 per cent last year. Its assault on the US market should be substantially boosted by its recent $150m acquisition of GTE CyberTrust Solutions, a similar operation in Boston.
"We've been aggressive on the mergers and aquisitions front," says Mr Rooney, and that remains a major component of the company's growth strategy. Recent breaches of security at several high-profile US websites, namely Yahoo, amazon.com and CNN, can't harm its sales pitch either, although Baltimore tends to go easy on the scare tactics.
"I hate security being associated with negative things," says Mr Rooney. "We see it an enabling technology. Rather than telling our customers, 'Without security you are under threat', we prefer to say, 'With security, look what you can do'. Its all about building a trust infrastructure."
Baltimore has also come up with what it is marketing as a complete security solution for mobile commerce, which is expected to explode as the world-wide web fuses with wireless communications. Its system Baltimore Telepathy is aimed at businesses that require encrypted security between WAP (Wireless Application Protocol) phones and WAP servers. The technology will be outlined in seminars around the world.
Mr Rooney is proud of having "never spent a penny on advertising". Mass-marketing wouldn't be of much use to Baltimore, which has to get a highly detailed message across to IT procurement departments in major companies and public services. Yet the firm scored a major PR coup two years ago when President Clinton and Ireland's Taoiseach Bertie Ahern digitally signed a joint communique using technology Baltimore had developed.
Several framed photographs of this milestone in the evolution of e-security are on prominent display in its chief executive's office, which is separated from the main floor by a glass partition. As he mills around among his staff, Mr Rooney is repeatedly approached by eager subordinates requiring him to check and sign documents.
He helped vet the first 70 appointments but he has had to delegate the task of recruitment since the payroll swelled. He readily concedes that it will take more than the team management skills he learned on the football field if he hits his target of turning Baltimore into "a several-billion-dollar business with more than 1,000 people worldwide in a couple of years".
People are attracted to Baltimore, he finds, because they want be part of something that looks destined to be big and dynamic. "As we've grown, we've looked after them. All have been incentivised by options. They've all done well out of it."
Fran Rooney has also done rather well, breaking into the upper echelons of Ireland's Rich List at a relatively tender age. The Sunday Tribune estimates he is worth IR£245m on paper. Last year he sold 150,000 of his shares, raising IR£2.4m (£1.9m). Those shares could have been worth 10 times as much if he had held fire until the beginning of this year. But he is unlikely to dwell much on that.
The former Shamrock Rovers player still has a lot to play for. With his 4 per cent stake in the company, he has a big incentive to ensure that Baltimore's stock remains hot.Reuse content