Company puts its future on the line

What: Citel Technologies, based in Seattle

Who: Chief Executive Mike Robinson, formerly with Seattle-based Active Voice for 12 years. Active Voice was the largest independent provider of voice mail before it was acquired by Cisco Systems in 2000.

The business: Sells hardware to customers who are making the transition from a traditional phone system or PBX (Private Branch Exchange) to an Internet Protocol-based voice system. Citel's technology allows customers to use their current PBX phones instead of having to buy all new IP phones, which cost $180 to $600 each, Robinson said. That saves the customer 50 percent in implementation costs, he added.

Behind the scenes: Citel accomplishes this by providing a box that acts as a translator between the traditional phones and the company's computer server.

Company history: Citel was founded in Nottingham, England, in 1995. Robinson joined Citel in late 2000 and was promoted to CEO three years later. He decided to move the headquarters to Seattle at that time.

Why: "The market for IP telephony is happening faster in North America than it is in the rest of the world," Robinson said. "It's easier to sell into your own backyard."

Employees: 25 in the U.K., 17 in Seattle.

Product evolution: Before Citel's current offering, it developed products that allowed traditional PBX phones to talk to a PC. Among other features, it allowed users to log phone calls and record conversations.

Investment funds: Recently raised $7.5 million in venture capital from U.K. investors. Since refocusing the company's direction, has raised a total of $20 million.

Making the transition: Robinson said three things are driving companies to migrate to the new system. He said IP-based systems cost less to operate, can scale to large numbers of people and are more resilient in disasters. The systems provide features traditional phones don't, he said, including instant messaging and simultaneously ringing office and cellphones.

Adoption: Sales of PC-based telephone systems have grown from nothing three years ago to 30 percent of system sales today, he said. By the end of the decade, Robinson expects every new phone system sold to be IP-based.

Long way to go: Though growing fast, the new systems are still a drop in the bucket. Roughly only 4 percent of all the systems installed today are IP-based, Robinson said.

— Tricia Duryee