AssistGuide pulls
down a cool mil

The local company
will put off profits in
favor of expansion

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By Lyn Danninger
ldanninger@starbulletin.com

AssistGuide Inc. doesn't want to be profitable right now.

Instead, the local company will use a $1 million infusion of venture capital to grow "in leaps and bounds," founder Kevin Sypniewski said.

The company received its latest round of funding from new investors, including some familiar names in Hawaii, such as International Venture Fund's principal and founder Debra Guerin, Silicon Valley Bank Chairman John Dean and Digital Island founder Ron Higgins.

With the cash injection, AssistGuide will have attracted almost $3 million in venture capital since it was founded in 1989 by Sypniewski, now its chief executive. The company provides Internet-based business services and systems exclusively to senior citizens' long-term health care and disability-related businesses.

Sypniewski said the new investment will allow AssistGuide to grow at a rapid pace. The company already has about 350 clients nationwide and 25 employees in Honolulu, Houston, Dallas and St. Louis.

"I'd like to be in eight or 10 markets by next year," Sypniewski said.

Although at its current pace and investment level, the company would reach profitability in mid-to-late next year, Sypniewski said attracting additional capital and putting off profitability means AssistGuide has the ability to expand at a faster pace than would otherwise be possible.

"This money would technically fund us to cash flow positive or profitability, but we'd rather grow at an accelerated pace and that requires additional money," he said.

While it is now much harder to raise money than it was in the late 1990s when technology stocks skyrocketed, the company continues to attract investment. Its product fills a niche in a growing industry. It also has continued to grow and attract a steady stream of clients and revenue, despite tough economic times, Sypniewski said.

"We were doing this before the Internet boom, we've been here during the downturn and have clients who have been paying us since 1998," he said. "We've also been able to replicate the model created in Hawaii in hundreds of cities and can show that it works on a national scale. Something exciting to investors today is a company with revenue and clients."

Sypniewski this week will receive an award from City Bank's fourth annual Targeted Industries Growth Report, or TIGR, this Friday. AssistGuide will be one of five companies to receive an award.