Shop Talk: VOIP provider Alteva keeps it local, plans possible acquisitions

Alteva CEO Will Bumbernick, 35, came to Philadelphia for the same reason many men move to new cities.
“I followed a girl to Philadelphia. The girl didn’t work out, but the area did,” he says.
And did it ever. After running, and then selling, his own technology consulting firm, Bumbernick, along with engineer Mark Marquez, wanted to start a company in a new sector that relied on monthly subscriptions. Bumbernick said he was enticed bythe stability of a monthly invoice, especially after his consulting days.
The two soon founded Alteva, a company that provides voice over internet protocol (VOIP) services to over 300 small- to mid-sized businesses. And, unlike many tech companies in the Philadelphia region, they are doing it all from inside city limits.


The cornerstone of Alteva’s [pronounced ALL-tee-vah] business is undercutting large, bloated voice-based telephone systems that many business are forced to buy.
Most businesses run telephone systems out of what is called a private branch exchange (PBX). The PBX is a box that a business connects all of its phones to that, in turn, is connected to the telephone carrier.
“That box provides all of the call routing, extension to extension dialing, voicemail, auto-attendance, and it also provides call center queuing,” says Bumbernick.
That simple box can get pretty expensive. Bumbernick estimates that, for a company that has 100 employees, the phone system can cost $1,250 to $1,500 per employee or $125,000 to $150,000 per company.
“Our [data-based] solution is $30,000 for that same set of features,” he says.
In short, Alteva does for small= to mid=sized business what Vonage does for homes. Though, Bumbernick is quick to point out that business demand flawless, reliable telephone systems when the average residential user may not.
“If your phone bill goes from $70 to $20 at home and you have a dropped call, you just think, ‘Man, I saved $50, I’ll just call the guy back.’ Businesses don’t think that way.”

THE BIG MOVE

Anyone with half an eye on Philadelphia business likely often hears the following story:
A business that wants to serve the Philadelphia metropolitan area also wants to be located inside the city limits but instead chooses the outlying suburbs to avoid the crushing taxes. For Alteva, the story is quite the opposite.
The company is based in the Bourse Building facing the Independence National Historical Park in Old City (you know, the one with the overpiced food court in the first floor). The company used to be jammed into the corner of an existing office in Delran, NJ, but Alteva wanted to make its business attractive to the young engineers graduating college.
“We really wanted to place the business where [graduates and young engineers] work and play ,and Old City was the perfect fit for that,” says Bumbernick.
Alteva was also enticed by an incentive package presented by the Philadelphia Industrial Development Corporation.

LOOKING FOR ACQUISITIONS?

In its sixth year of operations Alteva has over 300 customers and 28 employees. Bumbernick says he plans to build the product like its shareholders are going to own it forever. Alteva forcasts rapid growth, planning to quadruple its current size in three years.
Though most of its customer base is local, Alteva has lines in 48 states and 14 countries and is seeing several market opportunities. The company is weighing whether to acquire an existing company or instead starting satellite operations to be built organically.
“We’re going through those steps right now – we are certainly considering growing through acquisitions or being acquired,” he says.
But Bumbernick doesn’t seem to want to sell anytime soon. He repeatedly mentioned how much fun he was having helming a growing local business.
“In 2003 we decided to hit the ground running – And here we are, six years later, going gangbusters and having a whole lot of fun doing it,” he says.