The Interact System has developed software tool that help hotels chains solve application integration. Interact’s application integration server (AIS) provides a two-way interface between central reservation system and property management system. At least two important trends in the hotel industry are relevant. First, hotels are shifting from manual booking to electronic booking of room reservations, and electronic bookings will continue to increase as more reservations are made over the internet. Second, competitive pressures are forcing hotels to implement yield management programs and to increase customer service by integrating the central reservations systems and property management systems through Interact’s application integration server.Interact forecasts application integration expenditures in the hospitality industry exceeding AED1billion by 2013.The company started as an idea, in 2007, of Greg Thomas. He has twelve years of system applications experience and currently is Interact’s chief technology officer. Eric Westskow joined Interact in early 2010 as president and CEO. He had worked in sales and marketing in the software industry for more than twenty years.The first product was sold and installed in 2008. In 2009, revenues start to grow and help pay some expenses. Sales were only AED500,000 in 2010. However, now the firm has dependable market-tested AIS products ready to be shipped, revenues are expected to reach AED20.8 million in 2013.Greg Thomas founded Interact Systems with AED50,000 of his own savings plus AED50,000 from friends. Two private investors provided an additional AED200,000 in 2008. In addition, AED1million was obtained from a venture capital firm, Katile Capital Partners, in early 2010 in exchange for an equity position in Interact. The firm currently is seeking an additional AED5 million to finance sales growth.Questions1.