With a new CEO driving a multifaceted growth strategy, Metaswitch Networks is lining itself up for a potential IPO in the coming years, the vendor's chairman tells Light Reading.

The recently appointed CEO is Kevin DeNuccio, the colorful and charismatic former Cisco Systems Inc. (Nasdaq: CSCO) and Redback/Ericsson AB (Nasdaq: ERIC) high flyer who added the top exec position to his role as a Metaswitch board member in February. (See Redbacker DeNuccio Becomes Metaswitch CEO.)

His task is to help expand the company, which claims to have been increasing its revenues, and generating profits, since George Michael was in Wham! (That's the early 1980s, for those who are too young to know or who pretend they don't remember.)

DeNuccio took over from the current chairman, John Lazar, who is on a promotional drive to raise the profile of the softswitch, application servers, and protocol stack supplier (known as Data Connection Ltd. until mid-2009). (See Metaswitch Kickstarts MPLS-TP, Celtro Uses Metaswitch MPLS, Telcos Choose MetaSwitch, and MetaSwitch, TI Enhance VOIP.)

Now both men are focusing on ways to replicate the company's success in North America (where it generates most of its revenues from about 500 customers) in international markets, and also to expand into new technology sectors. (See MetaSwitch MileStones.)

Lazar is very confident that with some new partnerships (to be announced), DeNuccio's drive and contacts, the support of backers Sequoia Capital and Francisco Partners , and the reputation of its product line and engineering capabilities, the company can grow its annual revenues from around $140 million (the target for this financial year ending August) to $250 million, or "even half a billion," says the chairman. (See Data Connection Funded.)

That level of growth could lead to an IPO, Lazar casually mentions, though it seems a public listing is firmly in the roadmap: "When we IPO..." was how Lazar began one sentence during the briefing with Light Reading, though he wouldn't fess up to any sort of timetable.

Lazar and DeNuccio know, though, that just selling the current portfolio into more territories won't get them to where they want to be in the near term. So the company is looking to expand from its "three strands -- VoIP gear, application/feature servers, and protocol stacks," to five or six.

One way to do that is through acquisitions. Hence the recent purchase of service broker specialist AppTrigger for an unknown sum (Lazar declined to comment) in early March. (See Metaswitch Squeezes AppTrigger and Who Makes What: Telecom Service Brokers.)

Lazar says that deal won't herald an "acquisition spree." He says the company will look for "judicious" deals, but the "primary strategy is organic growth."

In the meantime, Lazar is pumped about the service broker sector. "That market is about to take off," says Lazar. "We're seeing a number of RFPs now -- market activity is strong -- and it fits neatly into our portfolio" of next-generation voice and unified communications applications products and developments. (See MetaSwitch Demos Mashups.)

Even if the market takes off, though, revenues from AppTrigger will be limited, so the company is working hard too on developing new product lines that play into mobile and fixed operators' needs for converged applications. "We have a unique understanding of voice and a great understanding of IP, and of the migration from TDM to IP," claims Lazar.

But with one small acquisition and a focus on organic growth, those new "strands" will need to be something special to help DeNuccio double, or even treble, Metaswitch's revenues and take it public. Special, though, doesn't look beyond Metaswitch's capabilities.

— Ray Le Maistre, International Managing Editor, Light Reading