After pioneering the concept of independent third party testing in India, AppLabs is now on a new mission, to leverage the Cloud for testing. AppLabs which is the world's largest software testing and quality management company is among the top ranked in areas of Customer References, Company Certifications and Company Recognitions in the Global Outsourcing 100 ratings of 2010.

In an interview to AndhraBusiness.com, the founder and CEO Sashi Reddi talks about the company's expansion plans and pioneering efforts in cloud testing.

You were seen as a key player in the testing market. Where do you stand now and don’t you think the company is stuck somewhere in the market?

AppLabs can be credited with having defined the independent testing market. We are now the largest independent testing company in the world. We are widely respected as the thought leaders and the pioneers in this market. We continue to successfully compete against the large vendors such as Infosys, Wipro, and Cap Gemini for large enterprise accounts.

Is there any reason for the company to remain away from the capital market and what is the equity composition now? Please give the details of the investors you have now.

The fact that we have not yet gone public may give the impression that we are “stuck”. But then we do not view doing an IPO as central to our business plan. As a highly profitable growing company backed by the world’s most prestigious venture capital firm, we have multiple options to fund any future growth. That said, we may tap the capital markets at the appropriate time if we need to provide an exit for existing shareholders.

What are the sectors in which you currently operate and what are the key revenue drivers?

AppLabs focuses solely on the software testing market. Some of our key verticals are airlines, retail, capital markets, technology, and healthcare. In these 5 verticals we continue to be the dominant player in testing. In each of these verticals we are serving many of the largest global companies as their exclusive testing partner. Typically we are engaged by the CIO of a Global 2000 company to help consolidate their testing activities into a central shared service to drive quality improvements and contain costs. We are responsible for generating millions of dollars of savings and quality improvements for our customers.

What is the headcount now in AppLabs and what are your expansion plans?

We are currently over 2,000 people spread across India, the US, and the UK. Our plans are to continue to develop deep domain knowledge in all the verticals we operate in so that we can understand the business challenges of our customers and drive value through our services.

As part of the expansion if any, would you look setting up new facilities, increasing head count or making forays into new business segments?

Since our customers are global we need to be global as well, growing beyond the US and the UK. We are exploring our delivery centers around the world so that we can be closer to where our customers do business.

How has the economic recovery in the US been and what has been the impact of that on AppLabs' business and margins?

The last two years saw us focusing more on managing costs to take a conservative view during the global downturn. Now we are back to an aggressive expansion mode and are rapidly adding headcount for delivery as well as further investing in our sales and marketing operations.

Do you foresee any possible impact of the European debt crisis on your business in the months to come?

Currently we primarily do business only in the UK and are making small progress in continental Europe. So our exposure to the debt crisis is very limited.

What are the kind of opportunities that Cloud computing offers to a company like AppLabs, in terms of new business opportunities and cost-saving?

AppLabs is leading the way in terms of leveraging the cloud for testing. We are working with partners to offer a performance testing solution that uses the cloud to generate massive traffic for performance testing. This is the reason that many of the largest retailers in the world use us for testing their e-commerce applications. We are also investing in developing our own tools to help our customers to leverage the cloud for their test labs. This is changing the way that our customers invest in setting up test labs.

Do you have any fund-raising plans to strengthen your expansion plans?

AppLabs is again looking at further growth through acquisitions. As we formalize our plans on this we will be looking at sources of capital.