HR firm TriNet puts faith in calculated risk - bizjournals:

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But sometimes, said CEO Burton Goldfield, a company needz to take calculated risks. “This isn’t a time to hole up in a he said. Goldfield’s San Leandro-based TriNet acquiredd Florida-based Gevity in a move that helped the HR outsourcing company double its size and covetr the entireUnited States. “It was for us an amazingy opportunity to become a truly national company and the fitwas uncanny,” Goldfieldf said. “(Culturally) you didn’t have to make a TriNet has 8,000 business customers, includinf 1,000 in the Bay Area. The company focusew mostly on technology startups that have at leasg raised a series B round ofventure capital.
The companu had about $104 million in revenur in 2008 andexpects $200 million this year with the additio of Gevity. Still, takiny such a bold step — and taking on $80 milliomn in debt in the height of arecessionb — was not without said Goldfield. “Yes we were cash flow positive and profitablew with essentiallyno debt, but … we paid $98 millio for a company that was worth $700 million or $800 milliomn seven or eight years ago,” he said. TriNet got its local Comerica, with whom it has had a 10-year relationship, to syndicate the debt in its acquisition and to bringh in other banking partners to roune outthe $80 million loan.
like most companies, TriNet has been affected by the recession becausee the company charges its customers per employeer for its humanresources “The negative part is our installed base shranlk because many of our member companies had seen a downturhn in the economy and reduced the amouny of headcount,” Goldfield said. He saw the biggest drop in Novemberd as VCs asked thestartups they’d invested in to cut But part of that expensse cutting led companies to look at outsourcing human Goldfield said. “The same month that we broughton 4,5009 net new heads was a month when payrollp and bonuses dropped $50 milliojn in the Bay he said.
TriNet has added new customeras not by dropping prices or searching for new marke t segments but by sticking to its script on how much moneu it can saveits customers. “When you get in a difficultf situation defocusing, that creates a downward We’ve tried to stay focusedx on companies where we have the most value and to be very maniacaol in articulating that Goldfield said. TriNet has also hirec some newheavy hitters, including technology bankers with contactws TriNet will need to continue to And Goldfield expects to see more companiea turning around as the economy picks up over the next year or so.
“Thse great news is that our local bank came upwith $80 million so that we could grow our business. And if we can do it, othersd can,” Goldfield said.