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Cresta Testing

Company Summary

Since 1995, the Cresta Group of companies have been helping global leaders in their respective industries to develop sophisticated quality assurance and testing methodologies and infrastructures. Cresta is recognized as enablers to achieving our clients’ technical, operational, and financial objectives, through proper quality assurance and testing techniques and technologies. Cresta is a global services company with affiliated offices in New York, London, Dublin, and Stockholm. Cresta offers the skills and experience of approximately 100 QA/test professionals across the globe. Cresta works with some of the industry-leading testing tool software manufacturers, such as Mercury Interactive, Empirix, Rational and Compuware.

Simply stated, Cresta is more than a good source of testing consultants. While Cresta’s people remain its most valuable assets, it is their skills, professionalism and personalities, combined with Cresta’s proven success, SSTM™ (defined below),  and successful global track record, that ensure service capabilities and successful projects.

2.1 Company Ownership

Cresta Testing, Inc. was incorporated as a C corporation in the State of Delaware in October 1999 and maintains its headquarters at 142 West 36th Street, Suite 601, New York, New York 10018. Cresta’s telephone number is (212) 564-7774 and its fax number is (212) 564-6875. The Company’s e-mail address is  Cresta’s website is located at

At the time of its formation, Cresta was a wholly-owned subsidiary of its UK parent, Cresta Group, Ltd.  As of December 18, 2002, Cresta became majority owned by Dr. Samuel Waithe, the Company’s CTO and the key developer of the Company’s proprietary SSTM™ methodology.  Cresta Group, Ltd. continues to hold a minority interest in the Company.

2.2 Company History

Cresta was founded in 1999 as a wholly-owned subsidiary of UK company Cresta Group, Ltd. to service the U.S. divisions of its global client base. The Company began trading in earnest in January 2000 with excellent product knowledge and delivery ability, but with limited market research and exposure to the New York and U.S. marketplace. The revenue forecast for the year was set at $1 million US, requiring first quarter revenue levels of $104,653. Actuals showed revenue of $0. The Company’s first job was sold in March 2000, representing the start of revenue earnings. Second quarter revenue forecast indicated $206,000. Actuals showed revenue of $490,590. At the year-end, total revenue stood at $2,117,574.00 – an over-performance of approximately 200% against budget projections.

Following a strong start in 2001, events such as the September 11, 2001 attacks on the World Trade Center, various accounting scandals in the U.S. equity markets and a temporary shift away from using consultants, the business suffered a dramatic downturn. Business downturns continued through most of 2002, with business beginning to stabilize towards break-even towards the end of 2002. Also at the end of 2002, the CTO of Cresta acquired a majority interest in the U.S. entity and the former UK parent retained a sixteen percent (16%) equity stake in the Company. 

The following table and chart both show how the Company is regaining its historic gross margin percentage, upon taking significant cost cutting measures and trending in the appropriate direction towards break even and then back to profitability. These trends continue into 2003 showing the Company enjoying a steady recovery from the events of September 11, 2001.

Software testing business plan, company summary chart image

Past Performance
2000 2001 2002
Sales $2,124,814 $1,580,038 $1,066,916
Gross Margin $1,267,800 $801,474 $612,571
Gross Margin % 59.67% 50.72% 57.42%
Operating Expenses $562,391 $1,529,496 $823,571
Collection Period (days) 136 125 71
Balance Sheet
2000 2001 2002
Current Assets
Cash $173,057 $96,198 $152,690
Accounts Receivable $791,007 $292,413 $121,711
Other Current Assets $13,848 $304,173 $15,933
Total Current Assets $977,912 $692,784 $290,334
Long-term Assets
Long-term Assets $70,767 $83,570 $92,595
Accumulated Depreciation $2,604 $8,305 $15,496
Total Long-term Assets $68,163 $75,265 $77,099
Total Assets $1,046,075 $768,049 $367,433
Current Liabilities
Accounts Payable $138,415 $332,970 $58,718
Current Borrowing $322,772 $385,301 $27,515
Other Current Liabilities (interest free) $22,000 $0 $84,483
Total Current Liabilities $483,187 $718,271 $170,716
Long-term Liabilities $0 $0 $0
Total Liabilities $483,187 $718,271 $170,716
Paid-in Capital $150,000 $150,000 $544,732
Retained Earnings $0 $412,888 ($106,521)
Earnings $412,888 ($513,110) ($241,494)
Total Capital $562,888 $49,778 $196,717
Total Capital and Liabilities $1,046,075 $768,049 $367,433
Other Inputs
Payment Days 30 30 30
Sales on Credit $2,124,814 $1,580,038 $1,066,916
Receivables Turnover 2.69 5.40 8.77