The best sale Bill Tatham ever made was of his own company. Through September 2000, Janna Systems, a Toronto-based developer of customer relationship management (CRM) software, had racked up 16 consecutive quarters of growth. The publicly traded company was highly profitable. Plus, Tatham had passed his personal wealth target—his “how much is enough?” number—and was growing concerned about having almost his entire net worth tied up in Janna stock. But Tatham was in no rush to sell. So, when Janna’s largest competitor, Siebel CRM Systems, offered to buy Janna, Tatham played hardball. Janna had gone up against Siebel, the American giant, on multimillion-dollar contracts eight times—and had won each skirmish. “They really wanted us to go away,” says Tatham.

Tatham demanded double Janna’s share price. His banking advisor said he was nuts; the median M&A premium for a technology company at the time was 30%. After three months of negotiation, the two companies settled on a 75% premium. The $1.76-billion deal in November 2000 was then a record price for a Canadian software company. “It was a good game,” says Tatham. “Sales is fun, when you win.”

That kind of rush is hard to give up, even if you’re stinking rich. And before long, Tatham was back in the game. In 2005, NexJ Systems Inc. took up where Janna had left off, selling customized CRM solutions to financial institutions but tapping new technology such as cloud computing and social media. With an experienced team using a proven business model to target a familiar market, the new venture took off much faster than its predecessor. NexJ’s sales surged from less than $200,000 in 2006 to $30.2 million in 2011, a five-year revenue growth rate of 15,025%, good enough for top spot on this year’s PROFIT 200 ranking of Canada’s Fastest-Growing Companies. NexJ now counts three of the world’s largest asset managers among its clients, including Wells Fargo and Morgan Stanley Smith Barney. “We’re the de facto standard in that space,” Tatham boasts.

Although NexJ’s product and even its executive team are pretty much the same as Janna’s, NexJ (which stands for “next Janna”) faces the same challenge as its predecessor: to woo giant corporations while competing against much larger rivals such as Oracle and To win the war, NexJ is leveraging the CRM expertise it sells and applying other smart sales and marketing tactics that can work for businesses of any shape or size.

The Janna story is so critical to NexJ’s success that Tatham immediately directs the conversation toward it. Founded in his basement in 1990, Janna started as a management consultancy, formed after Tatham left Andersen Consulting (now Accenture) to launch his own firm. One project led to CRM software that Janna had tried to sell through retail. But, hobbled by slow sales and plunging price points, Janna lost tons of money and Tatham almost lost his house. So, the team re-engineered the software to target enterprises, to which they could sell thousands of copies at a time, at four-digit prices per user, along with integration services. Things took off after that, with the company eventually dominating its niche among Wall Street banks. At the time of the acquisition, Janna had $55 million in annual revenue.

The Siebel deal came with a three-year non-compete agreement. Tatham’s 3.1 million Janna shares brought him $240 million, so he bought himself a Ferrari and retired—for about two months. Restless, he and five ex-Janna execs started venture capital (VC) firm XJ Partners. Tatham was satisfied with XJ’s investment record, but individual entrepreneurs frustrated him. “The companies didn’t perform like ours had; there wasn’t the same sense of urgency and intensity,” he says. “We felt like we were leaving money on the table.”

It shocked no one who knows Tatham that, on the Monday after the non-compete handcuffs came off, he started a new company with his five VC partners. “It was a big day at XJ when we sold our pool table and replaced it with eight cubicles for the developers we would hire,” he recalls. The idea was to take everything the team had learned about CRM software and institutional clients and build a better system from the ground up. Since the sale of Janna, most enterprise applications had moved to the software-as-a-service (SaaS) model; but, amidst growing concerns about security in the so-called public “cloud,” NexJ saw an opportunity in offering a “private cloud” solution whereby data is housed behind the client’s own firewall.

Ian McPhee of Waterloo, Ont., a tech entrepreneur and consultant who was an early Janna investor and now sits on NexJ’s board, notes another incentive: one of Siebel’s competitive weaknesses was poor client support. “The only thing that could make Siebel less customer-friendly was to be bought by Oracle,” says McPhee. In 2005, that happened, which “presented a business opportunity for NexJ.”

So, ironically, did the 2008 financial meltdown. It was followed by some trillion dollars’ worth of mergers in U.S. financial services. NexJ’s focus on integration and customization proved to be a major competitive advantage when courting companies desperate to merge disparate CRM systems quickly. Ralph Garcea, an analyst at Toronto-based NCP Northland Capital Partners, says NexJ has one of the most flexible systems on the market, one that can accommodate both new mobile devices and old desktop hardware. Plus, the company is nimble. “If someone puts out a request for proposals and wants to do a pilot for 100 brokers, NexJ can do it within days,” says Garcea. “Other guys require weeks and sometimes months to respond.”

As well, the advanced features being offered in the new generation of CRM software have been luring more and more financial services firms to make wholesale upgrades. NexJ’s product, for example, allows tracking of client communication across everything from phone and email to Facebook updates and LinkedIn CVs, and can integrate that information with a customer’s transaction history. The advisor can then segment that data based on customer assets, finances and life stage, and use it to target offerings more precisely.

Naturally, NexJ leans heavily on such tactics in selling its own software. The inside sales team, which focuses on lead generation, relies on the Internet to identify and target prospects. For example, the company frequently stages webinars in which its own experts, alongside independent analysts, offer primers on topics known to interest clients. Salespeople promote the webinar to prospects found on purchased lists. Every webinar viewer must register, and NexJ closely tracks any questions asked. Each attendee is “scored” based on engagement and qualifications: Do they have an active project? Do they control a budget? Then, sales reps follow up with meetings.

Syndicated content is a similar tactic, whereby NexJ posts branded white papers or other expert material on a partner website, offering it free to anyone who registers for it—thus generating another sales lead. NexJ personnel staff booths at trade shows focused on the company’s vertical markets, but the company’s hosted events are preferred. When NexJ was having trouble closing a deal with a major Canadian bank, it organized an event in New York featuring presentations from top people at Morgan Stanley, one of its biggest clients, and invited the Canadian bank’s executives. NexJ also has an advisory board composed of customers and, once a year, hosts a face-to-face sit-down to discuss their needs and business challenges.

Ultimately, in enterprise sales, nothing matters more than word of mouth. Formal references are important, says Tatham, but just as crucial are the feelers one executive sends to another who has tried a system. Ensuring the prospect hears the right things means making certain the client is satisfied. NexJ does that by inviting the “business champion” at the client company to media interviews when the project goes live, providing publicity that can help that person’s career. Credited with spearheading a successful project, the executive is happy to serve as a reference. This is how NexJ won Morgan Stanley thanks to a nod from Wells Fargo.

Richard Davis, a Boston-based enterprise software analyst for Canaccord Genuity, hears the same sentiment from the buyers. “A lot of times, it’s about [which vendor] has the best reference customers,” says Davis. “People buy from people they trust. How do you create that trust? You call a colleague who bought the product.” Large financial institutions have long sales cycles; but once you’re in, you can quickly leverage a reference from one division to target another. As Tatham puts it: “We hunt elephants. You drop one and eat for a long time, but it could be a long hunt.”

While Janna had struggled for years to raise financing, NexJ’s experience has been a relative breeze, thanks to the team’s stellar track record. After relying on founder money at startup, the company has raised about $70 million over three rounds. Last year’s decision to go public was driven, in part, by a condition in earlier financing that the company do an initial public offering within 12 months and, in part, by the sense that a market window had opened. But another key reason was to boost the company’s credibility among clients. “Being public provides some financial transparency, so the client feels comfortable that we’re stable,” says Tatham.

While wealth-management and insurance clients—three-quarters of them American—comprise almost all of NexJ’s sales, a key impetus for the company’s creation lay in another sector: health care. In 2002, Tatham’s wife got breast cancer (she later recovered), and the experience made Tatham recognize a huge opportunity: “What we did for banks 10 years ago, health care doesn’t know how to do at all, which is take all the information about the customer, tie it together to create a comprehensive view, then optimize the service model to give the customer what they need.” With a bit of re-engineering, NexJ’s software could help hospitals digitize patient records and follow up.

NexJ’s plans are ambitious. It’s creating an entire health care platform that would share patients’ records with their various care providers. But this is a challenging market that can take years of pilot projects and trials to crack. NexJ is currently doing trials with various hospitals in Canada and the U.S. And, while Tatham sees health care as potentially NexJ’s biggest market, it currently represents just 1% of revenue.

Developing the health care product is a major factor pushing NexJ into the red, but that’s not unusual for companies at its stage, analysts note. The next milestone the market awaits is NexJ’s sales topping $100 million, says Garcea, at which point the stock will become appealing to portfolio managers. “I could see an acceleration in growth as larger deals roll out,” he says. “The more reference deals you have, the more the sales cycles will shorten.”

Tatham has the $100-million revenue target in sight. But, as with the sale of Janna, he’s in no rush. “People have different definitions of entrepreneurial success,” he says. Companies with up to $10 million in revenue are really in a startup phase. Past $30 million, you need to transition into a sales-driven company. Reaching the next phase—$100 million in sales or $1 billion in market cap—requires becoming more marketing-driven, so that clients are coming to you.

That’s Tatham’s current target for entrepreneurial success, which he aims to reach within five years: “We’re definitely well past the other definitions.”

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