SOFTWARE company Xpansys Limited has beaten off competition from global software giants Microsoft and Oracle to win public sector contracts in the North-East.

The Middlesbrough firm, established under two years ago, spent nearly 18 months developing an e-business software application that allows team-based management of large-scale Intranets or websites and allows users to transact online.

The company founders, Paul Wildy and Paul Sheperia, have so far funded the product development out of their own pockets.

"The cost has been substantial and there have been times when we wondered if we would ever see a return, but all the risk and hard work has paid off in the long run. We now have a product that rivals the best solutions in the world and we are steadily winning new customers all the time" said Mr Wildy, commercial director.

Xpansys won a contract with Business Link County Durham providing a web-based self-service application for businesses to benchmark themselves against their local competitors.

It has also helped set up Intranet and Extranet facilities, where only authorised people can access sites via the Internet, for Coast and Country Housing, a major Teesside housing association.

Mr Sheperia, technical director, said some companies should look closer to home for quality e-business products.

"Unfortunately, some people think that if it comes from Silicon Valley instead of Tees Valley then it must be better," he said.

"We set out to prove such narrow-minded people wrong and we believe we have succeeded. Teesside has a long history of engineering excellence and we do not see why software engineering should be any different."