 back and we're really live this time. This is Think Tech Tech Talks. I'm Jay Fiedel and we have a company that has been through various, you know, periods in its history, but which is now under a parent called Datanet Systems Inc. and the CEO or computant and the CEO is Francis Tulu. He's to my extreme left and Michael Chan and he's a business development manager. He's to my immediate left. Welcome to the show, you guys. Thank you for having us. Yeah, thank you so much. Nice to meet you. Okay, great. I'm looking forward to a really exciting show here. Okay, first, Computant. Local company, huh? Yes, sir. And it was founded in 1986 before I was born and it has done remarkable things serving the community here and other communities elsewhere. So, you were there, Francis. Let's talk about why you founded this company, what it was like and bring it forward till today. Okay. So, all my life throughout my life, I do like solving problems. So, after I graduated from Hawaii Pacific University, I've had several jobs and in my jobs, it was always we have, you know, this process, this procedure and I want you to find better ways. So, it was my way of finding software solutions and implemented for businesses and I've done that for real estate companies for local appliance companies and distribution businesses. So, at some point after several years of work, I decided I would like to get into a business myself and see how I can make a difference, how I can go to businesses and solve problem. This is how Computon was born and the first solution that I have gone out and implemented, it was membership management for clubs. Once I have done several of the clubs in Honolulu, Hawaii, then I went after implementing accounting systems for means-sized businesses throughout the island and after four or five, six years, of course, we had to find new market and that was the birth of point of sale systems for Computon. I really appreciate this because I think, you know, where you're living is in database systems and database systems can be so powerful. People don't realize how important they are and how sophisticated they are and how they can solve any problem really, any business problem with a database system, so I really appreciate it. We have a database system here, so we come at that, you know, come at the issue from our own experience. Okay, so you started in what retail? We started with accounting software for wholesale distribution. Hotel distribution? No, wholesale. Import sales. Yes, sir. Okay, that was easy. Yes. Relatively speaking. Okay, and then you got into membership clubs, was it? Membership club management software. That's pure database, isn't it? It has lots of names and all those and finding people and all that. Okay, and then you got into even more sophisticated things with general accounting packages? General accounting packages for inventory management, wholesale distribution solutions. You were coding your own self at that time? A little bit of both. We became partnered with computer associates and sage software. That was a big company. There was a big company back then. Still around? They're still around. Okay, okay. I remember that huge company, a national, international company. Yeah. Okay, and your office was on Richard Street, you told me back then? For very, very long time we're there. Until five, six years ago, we moved to Waimanu Street. How were you funded? Friends and credit cards? Definitely. That's the only way, right? We started the business from home, home office, and then when it was time to find an office, of course, I had a shared office on a near Honolulu Advertiser building. We were there for a couple of years and then we outgrew and then we took an office and they continued to expand from there. You know a lot of companies in Hawaii resist local computer integrators and programmers. They say, oh no, we got to mainland. We got to talk to bigger companies. We can't talk to local companies. Did you find resistance in that regard? Funny. Funny you mentioned that. It was a challenge. It was a challenge, I would say, 25, 30 years ago when we were a small company. We are unknown, but over time we've been around. Our name is around. We have done implementations for a lot of, I would say, big local companies. As an example, if you look at Fisher, Hawaii, the largest office supply and furniture company in the state of Hawaii. With a million, zillion little things. Little things. Database heaven. They used to have 130,000 products. So Fisher, Hawaii, we are thankful to them. They have given us the opportunity to work with a Hawaii-based little small little company. And for them, we have implemented point-of-sale systems, inventory management, purchasing, accounting integration. They have three locations with over 100 users. We implemented their servers, their networks, all into a wide area network solutions. So company like Fisher, when they implemented the system in 2010, in the past, they would be looking elsewhere. But we were able to do a job and a pretty good job at a fraction of the cost. And tailored to their operation. Exactly tailored to what they needed and wanted. Exactly. Another example would be Polynesian Cultural Center. Over 50,000, it's a huge, huge property with lots of retail stores, lots of restaurants all over the facility. Visitors and reservations and all that. Exactly. So we are thankful to them. They have given us the opportunity about five, six years ago. Look at Shirokia, the Shirokia Japan village. They have 72 terminal. Right. So over time, we have... Are you sitting here with me? Absolutely. Thank you for coming down, Francis. My joy, my pleasure, my pleasure. So yeah, at the beginning, I think we had to prove ourselves that we are worth earning their business. There were some challenges where, you know, we were too small for some of the local businesses and they went elsewhere. But over time, we overcame that challenge. You know, you're thanking them. And I suppose that's appropriate. But they should be thanking you also. Because all the businesses you named, if they didn't have a good system, it would be terrible for them. Especially in the run-up, you know, in the time between, say, 1986 and now where things have expanded in so many ways. If they didn't have a system that would track on that expansion, deal with all the issues, have a database they could rely on, they wouldn't be where they are. You've made it possible for them to change with the times, to handle their business challenges. And furthermore, I would say that if you didn't do that, if you gave them a system that was not quite right, the disaster would follow, you know. So they should be thanking you, yeah? I think we gave them the tools and then they used the tool to basically run their business efficiently and manage their resources. That's very important. You're their most important partner, I would say. I know how that works. You know, you can be efficient or you can be behind the curve and never catch up. And a database system for a business so critical, especially your retail business or the kind of business you describe, yeah? So now, let's go through this chart. I'd like to talk about this chart of your expansion, if you will. DataNet Systems, Inc., all right? And you have what, one, two, three, four, five icons on the chart. Can you describe that? Sure. So DataNet Pacific, we started that as a managed IT services company. And we provide, we implement network systems for medium-sized, small-to-medium-sized businesses, somewhere between 10 to 100 computers. And we manage their solutions. If they don't have the IT staff or they have IT but not enough manpower or technical power, they come to us. So we provide disaster recovery solutions. We provide backup if they need system updates, right? Monitoring. These are the services we provide. In the recent years, I would say about three years ago, we also expanded into cloud hosting. Many, many businesses, for instance, real estate companies. You have engineering firms. You have doctors' offices. They have offices, not, they're more than one office. And so how do you link them together? The old way used to be, you buy servers for this location, servers for that location, and you have some workers work from home. Some could be working from a remote office. Engineering firm could be having a trailer someplace where the construction project is going on. So we brought in the cloud hosting solution for businesses where their software application, their email, their database resides on our cloud data center. And then they all connect to it remotely. Benefit is everybody is connected to the same system, right? And second benefit is that you can do that at a fraction of a cost because the infrastructure is already in place that they don't need to invest in. We made that investment for them. What's the connectivity? Are you connecting through wireless or Ethernet? Are you connecting in a way so that I can get it on any device? Anywhere? Beautiful question. You can use any device. You can use PCs. You can use Mac. You can use iPad. It doesn't matter what device you are using because the data is in our data center, and our data center is in the Washington state area because we have a lot of customers in the mainland. So it made sense for us to have a data center in the mainland, but we also have many customers here in Hawaii connected to that data center. So as long as you have a good internet service and you don't need to invest in any special internet service to connect to that, right? So as long as our client has internet service, whether it is wired or wireless, doesn't matter. You could be in a coffee shop. You could be in Las Vegas having a whiskey. As long as you have internet service to connect your laptop or your iPad and you have total access to your application and your data. One of the problems that I've noticed, we use Apple FileMaker here. I know it's way less sophisticated than what you do, but one of the problems I've noticed is that if you're on a wireless connection and then you lose the wireless connection and you're in the middle of a transaction, you've got to have robust software to remember where you were and to resume the conversation when you get back on the wireless side. I assume you did that a long time ago. It is part of the data center design. So when you are, let's say you are writing a letter or an email or writing a document or you are doing billings as an example. So all you're doing is from your laptop, you are using internet to connect to the cloud desktop. So the desktop is doing all the work. If you lose the connection, wherever you left off on your email or billing, right, it's still, it's running on the cloud desktop. So you don't lose anything. Automatically resumes. Automatically. And seamless. You don't even know what happened. Exactly. So have we finished the chart? I want to be sure we've gone to the last step of it. Okay. So we talked about Computant. DataNet Pacific. DataNet Pacific, the POS highway. So POS highway, very, very interesting concept, one they came to my mind. We all remember recession. Recession hit. Our sales went down by 40%. And we did what we could to stay in business. So we, all of this stuff, we all sit down and talk, how do we get out of that? Okay. Let's, how can we cut costs? That was the first measure, right? But you only can cut costs so far, right? Then that's not enough anymore. And since we had a small company back then even now. How small is now? Now we have 25 staff. Back then was probably 14. Okay. But we're like a family. So I can say that I can't pay you. Therefore I have to let you go. That's not an option. Because you know the children, the wife, and the husband, right? So when cost cutting is no longer an option, is it okay? We sold our point of sale system to small, medium, and big retailers statewide. Where do we go from here? The only answer is we have to go across the water. We have to go to the mainland. Then the question is, how would you do that? Where is your financial resources and manpower, right? Okay. Sometimes I think being ignorant is probably a good option. If we can dream about it, how we can not open an office there yet. Because we don't have the financial means. And we don't want to ruin computational reputation. Because locally we are known as Computon and we have a good reputation. What would be the next logical thing? How can we expand in the mainland, right? This is okay. Why don't we come up with a different website? Since we are doing point of sale, so POS should be part of the name. And we are in the information business. You remember Information Highway? Everybody used that information highway. So the idea is let's combine POS and Information Highway. POS Highway was born. And to our surprise, within three, four months, we got our first client. And you'll be surprised to know who the first client was. Central Park in New York. Interesting. Right? And we're surprised. Good for them. Right? So they hired us. They have five different gift shops inside Central Park. So they hired us. And I only had at that time one sales rep working out of his Virginia Home Office. He drove there, met with them, closed the deal. And I sent a couple of people to do the system. That's how POS Highway was born. So now we fast forward. Last year, we have been selling retail point of sale system only all over the country. For instance, in San Francisco, Southern Healthcare System. Their hospital, huge hospital chain. So they are gift shop, newborn connection. They bought system from us. This winery is in New York. Both system from us. So they're companies that we consider big in Hawaii. We have a client called Dance Fan City. They manufacture fan in China. And then they sell through Office Depot and Lowe's and all of the national chain. Two and a half, three years ago, they came to us. We got 39 stores and we have another 12 franchises. We want to talk to you. So honey, I got the call, my mainland sales rep transferred the call to my cell phone when I am getting ready to go to my office. It was quarter to seven. I'm in my underwear. I took the call and I'm talking to the IT person of that company, 1230. I'm still in my bedroom pacing around and talking to him. Year and a half later, they bought the system from us. So BOS Highway in a way allowed us to not only survive through the recession and then grow. Last year, we purchased another retail point of sale company out of Indiana called Midwest BOS. They do tremendous business with the hospitality side of it. They wanted to sell their retail operations, retail business. I met the owners in Atlanta several times. We became good friends and they called me and they are interested in buying Midwest BOS retail side of the business. We bought them and then of course we had to add more technical people and sales people in order to support them. They had about 150, 60 accounts, customers, but some of the customer may have 10, 20, 30 stores. So these also, these acquisitions also allowed us to go to the next step, grow the business to the next level. So we're going to have to go to the next level and go to Michael now. Michael's expertise. Michael, you've been around. You've seen at least some of this. You've been developing businesses, a clientele, yeah. Compared to a lot of the people at the office right now, I am fairly new. I was assigned to headstrong the ITAP POS project that we were doing. That piece of the chart is yours. Right, that's what I've been working on. That's my baby. What is it? It's a POS system directed towards restaurant and now we're getting into more retail, but mainly it started out as a solution for restaurant. And now we already had a restaurant solution, but we realized that times are changing and the demographic of business owners and the mindset of business owners have been changing. And you know, Hawaii, we have a lot of ambitious young people wanting to start up restaurants. Including you, I think. Yes. And food. I'm right, I know that. Yeah, absolutely right. And restaurants especially because food is really important. As soon as the new restaurants open, I head over there right away to try it out. And so a lot of these very young ambitious, or they don't even have to be young, you know, ambitious people that start a restaurant, they don't necessarily want have the money to spend a big upfront cost for the traditional kind of POS. It's a risky business. It is. It is. And so what we try to do is without sacrificing features, but we wanted to help kind of smaller business owners get into that market, you know, with food business with like a lower cost point and just kind of more of like a SaaS model where they pay like month to month on the subscription. So it is a very, very robust system. Oh, so what Francis was talking about, we sell a big system, it's cash upfront, and then you maintain it going, you know, it's a monthly or whatever. You're talking about maybe not so much upfront, and it's a monthly subscription. That way you have a small business keep going without a big capital investment. Exactly, exactly. And yeah, but at the same time, we didn't want it to look like a small system where, you know, it's lacking in features or cutting corners or anything like that. In fact, this system was created where it allows smaller business owners, like you mentioned, to compete against the big guys, right? But at the same time, give the big guys also a chance to save some money and moving forward in their operations. Well, I submit to you that a restaurant these days can really use high tech, and a lot of restaurants are, I say, behind the curve on that. They're using 17th century systems in terms of their food inventory, in terms of their customer menu selections, in terms of their communications with the kitchen, in terms of the payment of the bill. In fact, you go to Europe, for example, in Europe, they come out to your table with a little, you know, widget about that big, and that you order that way, and you pay that way. You don't have to surrender your credit card for any moment in time. It's really important. And so I think that's what you're talking about. Yes, Europe is a really ripe market. Yeah, you are correct. Yeah, Europe is a little bit more head of us in that sort of industry. And what this has is we actually have a paper with all the features. So this is a restaurant, it can do anything you can do, like you mentioned, order at the table side. So, you know, customers don't leave their credit card with the server, right? And it also has many additional features that can go into it, like online ordering, you know? Outside the restaurant. Outside the restaurant, right? More and more popular now. Yeah, especially Hawaii is getting crowded. You know, sometimes you have to wait long lines outside restaurants. You want to just kind of sit back at home on your computer or your phone, just kind of order food, pick it up, right? And you're enabling that. Yes, I am. So I can get on your program at home, I can look at the menu for my favorite restaurant or a series of restaurants, right? And I can go order things that I like, and that will result in somebody delivering it to me or pick you up or both. Both, both. You can go there and pick it up. And now what's becoming more and more popular is third-party delivery services like Uber Eats, Group of Postmates. And how those technology works is when a restaurant signs up with them, those companies give them a tablet. And when an order comes in, it alerts you that order came in and they have to walk over and manually punch in the order on their machine. But what we can do is integrate with that. So it automatically just puts it into your system without you having to be there, prints a ticket in the kitchen, and you know, it's more seamless, less work for you. And faster. And faster, a lot faster. Because it's really important that you're not waiting two hours for your food. Of course. Yeah, no one wants to do that. Nobody's going to do that. Yeah. You want to show us some of you. You have some screenshots. Sure. Let's take a look. Yeah, we can go over. Steve, this is the one we're talking about is ITAB. ITAB POS. This is the, is that the one? Oh, yeah. So this is kind of like the basic on-front screen with any servers. So as you can see here, when an order comes in, you can decide, hey, is it going to be for here? Is it takeout? You want to deliver it? Is it a phone order? You know, and the menu and the screen that you see here is very customizable. You can change it to however it fits your establishment. And yeah, just you can do it however you want it. So you can set it up with the menu for that particular restaurant. Right. And you can, I just know from what you've said so far, is that you can tailor this any way the restaurant wants and make the restaurant unique in some way. Exactly. It's not just the color scheme, it's the whole system operation. Right. And if you can go back to the slide, it actually has a picture. So the next one, and that's like a general report page. And the next picture. That's for the owner of the restaurant. Right. Yeah. I don't get that at home. So this is an example of what the back office looks like. So the way back office works for ITAB is that if you have a computer, whether it is a Mac or a Windows computer at home at the office, wherever, you have a portal that you can log on to your website's back office like that and control everything. You can customize your menu. You can see how much sales you're making that day. So I don't have to call you to change anything. I don't change it myself. Yeah, everything is. And I can order food. It's going to tell me how much I have to order in order to stay current to my food inventory. Yes, it does inventory as well. You can manage all of that. Yeah, this is a boom to restaurants for sure. Because restaurants, staff is expensive and sometimes you want to do it with the existing staff instead of hiring a new staff. And she was to have it all available right there this way. The owner can really be efficient and make more money or at least lose less money. That's a good thing. Sometimes you've got to tackle the negatives or you look at the positives. So this is a finished product. This is available right now. If I open the restaurant tomorrow I can call you up and you can set me up. And then I can tell her it myself. This is very good. So is this available not only in Hawaii but also in the mainland? This is everywhere. And it's multi-currency, multi-language. If a Japanese restaurant came to Hawaii and say I want to buy you POS and I want this to be in English because my employees are English-speaking local people. But in Japan I want the same POS in Japanese. Here I get paid in dollars. In Japan I want to get paid in maybe in yen. And one open up a restaurant maybe in Dubai and I want to collect in their currency. So you can localize the POS in their local currency, in their local language. But they still all talk together to the central database in the cloud so that you have a total picture of how your entire enterprise is doing. So what about training the individuals who are running the restaurant, the waiters, the owner, the cook, whatever. Is the training available? I mean you have videos that will train them. And are you able to get on the system remotely with so many companies too and show them this is what you have to do to make it work? Yeah. It's a full tilt boogie here. So our main focus is helping the industry in Hawaii. We want to help the local businesses first. And for them we need... We need more restaurants. This will help. Yeah. And we want to be able to... We do provide both. We can train them in person and there's online additional training videos that they can use without having to rely on us. It's up to their choice. But one of the biggest takeaway from that is that since we are a local company we are available to them. And there are... You mean they can call you on the phone? Right. They can call us on the phone. Because there's a lot of companies who call them on the phone. Lots of luck. Exactly. And there's other iPad kind of POS systems out there. And not to say they're not good POSes but their main focus is... They were created by credit card processing companies. So their main business is credit card processing, not necessarily the POS, right? So this is where we're kind of different from them in a sense that we come at it from a foundation as a POS company. And we're local. And we get many calls from restaurants that are already existing saying that they're not satisfied with their system not necessarily because of features but because they're saying, we cannot get support. So you're a business development manager. You're developing with me for sure. But are you also coding? Are you also a designer? Ah, I'm not smart enough. But he's not smart enough. He's not a programmer. But he's very bright and very sharp when it comes to what feature and function is needed to be more efficient, right? Where can we cut one step? You've got to be responsive to the customer. Exactly. And if you can do that, then you're going to build a customer for life. So this is the flagship right now. Is this the most promising thing in your array of software right now? The ITAB POS. It is a great product with solutions that can address every aspect of a restaurant business. And I think this is going to help us, our business to grow. As I've done that, with Computon, with retail software, started locally here, went to National. With ITAB, we started in a while last year. With ITAB, we have lots of customers here. So it's been successful. It has been so far very successful. So you have various kinds of software, with various kinds of markets. And my last question, we don't have any more time. We're out of time here. My last question is, what's the future for Computon to our data and data systems, whatever? Are you going to keep all these different functionalities under the same roof and the same holding company? Or is it almost time for you to start spinning some of these things off or going public? So my question to you, Francis, my closing question is, what's the future and when is the IPO? I like to be my own boss. I don't think I'll do very well if I have to take orders or somebody tells me you can't do that. When you borrow money, you have to pay it back. Therefore, you have to be very careful when you make decisions. I have run the business for 30-plus years without borrowing a penny. I'd like to keep it that way. You know, I knew that. Intuitively, I knew that. You managed to leverage everything out of operating income. Yeah, that's terrific. Right. My parents taught me one thing. You don't go buy anything unless you have the money. And I live by that. That's very good advice. So the money we made through the business, of course, you have to take care of our families, meaning mine and my partners and staffs, right? And then anything residual, we invested back. That's how we've done it. Now, you're going to continue to do that? I will continue to do that as long as I have the energy to work and run the business. I'm passionate about what I do. I'm passionate about going out and helping my customer. And I'll give you an example. But you have to develop a succession plan. You know that. I have started that. He may be sitting here at this table, that succession plan. Yeah. You know what? We got it. We got it. We got it closed. We appreciate it. Thank you for having us, Michael. Thank you for talking to you. You are a picture of energy and enthusiasm and innovation and creativity. Thank you so much for coming down here. Thank you. Thank you for having us. Thank you for having us, Francis. Michael, thank you so much. Thank you. Have a good night.