The earliest investment decisions a company makes often determine whether it can compete at all. Margarita Howard grasped this when she founded HX5 in 2004, and she put that understanding into practice immediately. Instead of directing startup capital toward an office that signaled prestige, she purchased a government-approved accounting system built for federal contractors. The choice, unusual for a company of HX5’s size at the time, became one of the defining moves of her leadership.
Removing the Barriers to Partnership
Government contracting has an infrastructure problem at the small business level. Firms that want to work as subcontractors on large federal programs must demonstrate billing competence, audit readiness, and cost-segregation capability. Companies that cannot show these qualities get passed over, regardless of their technical skills. Howard eliminated that barrier proactively. The accounting system she selected was familiar to government auditors and widely recognized by prime contractors, which meant HX5 could be evaluated as a credible partner from the start.
“This is what we used to bill the government,” Howard said. “So, that was also very attractive to large businesses, that we were very small at the time, and that we already had this government accounting system in place, which those large businesses had.” For Margarita Howard, the purchase proved that understanding the operational realities of the industry could be more valuable than size or name recognition in landing early relationships with large primes.
Capital Discipline as a Long-Term Strategy
Howard did not limit her infrastructure-first approach to a single purchase. The philosophy shaped how she allocated every dollar of early capital. HX5 hired experienced personnel rather than building a headcount it could not sustain. It invested in compliance systems rather than marketing spend. It maintained financial reserves as a buffer against the unpredictability of contract-dependent revenue. Those decisions collectively allowed HX5 to grow from a startup into a firm with over 1,000 employees supporting NASA and the Department of Defense across dozens of states. See related link for more information.
Find more information about Margarita Howard on https://about.me/margaritahoward