Stead Denton - True blue channel player

Denton is the experienced entrepreneur and founder of distributor The IPL Group, which has established vendor relationships with brand-strong players OKI Printing Solutions, Avaya, Alcatel and Siemens. Denton has guided the distributor through the vacillating IT industry and after 25 years, shows no signs of throwing in the towel just yet.

“I was born to be a distributor,” Denton told CRN. “If I didn’t do this, I wouldn’t know what to do. I still love the challenge of the chase. I like to catch and kill everyday.”

Ray of light“
I started IPL in 1982 and we were the first wholesaler importer/distributor of PC peripherals for PC and minis.”

Denton said at the time most importers and computer companies did not have dealers as such and they all sold direct.

“We started life as an importer and distributor of printers, monitors and disk drives to the dealer market. OKI was one of the products we were getting, not directly, but from a computer company called ICL,” said Denton. “The authorised OKI distributor went broke and OKI asked us to be the distributor and also asked us to take on the company’s fax machines — before that it was just printers and computer peripherals.”

Moving into the fax machines market was difficult for IPL as it was working with office equipment rather than IT, explained Denton.

“OKI was a big part of our business at the time and we were reluctant to make it an even bigger part, because you never want just one big customer or one big supplier. So they chose to take away some of our insecurities by taking 10 percent equity in IPL.”

Following this move, OKI then asked IPL to take over its mobile telephone business. “That was a complicated takeover because to sell cellular phones or any phone in Australia back in those days you had to have a local development program, you had to have some local comment. You couldn’t just bring in phones like you do now, as it was before the deregulations.”

Denton said not only did IPL take over the distribution, it took over
the factory which made the product in Australia.

“So for us it was a big move to go from distribution of computer peripherals to assembly and final test of cellular phones, which are pretty complex devices, but we did that and ended up taking the factory and all their staff. By this time OKI was about half of our business.”

Around this time, the mid-eighties, the market was booming and this inspired Denton to consider an IPO (Initial Public Offering).

“We went out looking for equity investors to take us public. We sold equity but we didn’t do it for the money so much, we did it as we wanted the experience on the board to do an IPO. That was done (the equity being sold) in September ’87 and in October ’87 the market crashed. So we had shareholders we didn’t particularly want and we couldn’t float. But what we had was a lot of money so we looked at what we could do and we started to buy businesses,” he said.

IPL acquisitions have included buying Chubb Australia’s cellular mobile manufacturing and distribution business in 1988 and acquiring the entire business of Voca Communications, an Australian facsimile and telecommunication business in 1996.

“As a company we have had to reinvent ourselves. IPL started life in one form and evolved into another, but it has followed where the market has gone, or where the technology has gone or what the requirements of government have been. To do that as a private Australian company in the IT market for nearly 25 years is remarkable.”

Denton believes there are not too many companies around when IPL started that are still around today in their present form, as those who don’t change or adapt to change won’t be here.

“The ability to change, the ability to be flexible and above all the ability to make money (is important in business). Knowing what you need to do to change and have the systems to manage a business of this size is a constant battle, but it’s a battle I love. I wake up everyday and ask where is the battle? Take me to it.”

Denton said the IP PABX market, which IPL is heavily involved in, is at the beginning of its growth.

“We have around 130 resellers in our voice business and we are about to embark on some carrier relationships. For me to get out of that now would be like jumping off before the train has left the station. It’s the new journey.”

Denton said IPL is aiming to act as a catalyst for vendors, dealers and carriers to come together to provide a solution.

Frozen
“As for the changes I have seen in the dealer base, a lot of dealers in the beginning sold stand-alone PCs and those who didn’t embrace networking fell by the wayside. Those in the fax business who didn’t realise those would be networked went by the wayside, too,” said Denton. “Dealers stand the test of time if they have realised what you were yesterday, you can’t be tomorrow and evolve intellectually through technology. Those guys have done it and done it very well.”

Denton explained that IPL has two distinct and completely different dealers bases: its OKI dealer base with OKI being very strong in the corporate and government sectors, then its voice business which has stable dealers which sell IP telephony and have a large investment in the brands which IPL carries.

“What advice would I give to a person starting in distribution today? You need to understand what dealers and the market want. You need a product which is at the beginning or during a wave. Picking winners is picking the wave really. You need to understand what the market wants. That is the difference between those who survive and those who don’t. How do you know? The whole business thing is risk. Those who choose correctly make a buck, while those who don’t are also rans.”

Denton said he and IPL have been in the industry for a long time and have seen a lot of competitors, customers and suppliers come and go.

“I think IPL will be around for another 25 years as I have no intention of selling. I probably won’t do an IPO, although I thought about it last year. I will look at how we build our future management team to take over what will be a bigger company than what it is today.”

Holiday
Denton has earned his free time after years of hard work and chooses to spend his spare time on his 15.8-metre yacht in Sydney Harbour and his Gold Coast condo. “I consider my lounging about the boat and Gold Coast as strategic to the business,” joked Denton.

“I travel extensively — because I have good management I am free to do that. Between travelling, the Gold Coast in the winter and the boat in the summer, fitting it all in is quite hard!”

Denton said around six or seven years ago he used the word retired, people believe that hasn’t made much difference to Denton’s role and involvement.

“My day-to-day involvement is at a higher level, handing dealers and vendor relationships and banking relationships. I’m not involved in day-to-day sales at all,” added Denton. “I meet my managers once a month and that is my total involvement at IPL as those guys run their own businesses within the group. My involvement is purely strategic.”

Denton is entitled to enjoy his accrued success, but it is Denton’s continuing ambition and desire to find the next big thing which separates him from the pack.

“I think IPL will be around for another 25 years.”