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Friday, April 10, 2009
Regional Spotlight: Beyond Massachusetts
Some New England firms seeing fundings, sales growth and hiring
By Keith Regan, Special to Mass High Tech
MHT's Efrain Viscarolasaga: How social networking is changing business
Interactive map of Greater Boston tech layoffs in 2009
MHT reporter Efrain Viscarolasaga on NECN: Green tech brings jobs back to Mass.
During the second half of 2008 and the first few months of 2009, these companies landed new customers, hired new employees, expanded facilities and forged new key partnerships. Some even managed to secure new venture funding or bridge financing despite the turmoil in the capital and credit markets.
Most states have several companies that could have been singled out, a reminder that growth continues, regardless of what the headlines say.
Rhode Island
Andera Inc.
Providence
Sector: Banking software
President and CEO: Charles Kroll
Employees: 60
www.andera.com
It might seem the worst possible time to be a software-as-a-service provider to the banking industry, but for Andera Inc., banks mean growth.
Andera sells technology that enables customers to open deposit accounts online, a functionality that only about 600 of the nearly 16,000 banks with an online presence currently offer, according to CEO Charles Kroll.
“While a lot of the banking industry is struggling, that makes it even more important for them to have a strong approach for customer acquisition and bringing in new deposits,” Kroll said. Andera added 30 new employees and saw revenue double in 2008, a year that saw it grow its customer base from 172 to 249 banks and credit unions.
Andera also secured capital to fuel its growth. “What’s nice is that Andera has a five-word mission statement and a three-word value proposition,” said Thorne Sparkman, managing director of Slater Technology Fund, which provided the cash infusion. “They help banks open accounts online. It’s that simple.”
“Right now, we’re at the point in the adoption curve where things are starting to snowball,” Kroll said. About 4 percent of online banks now have the ability to offer web-based account opening, with that level capable of leaping to 40 percent within five years. Andera plans to add another 15 employees in 2009.
“We’re getting ready to ride that wave,” Kroll said.
Massachusetts
Access Northeast
Marlborough
Sector: Network management services
President and CEO: Rob Stephenson
Employees: 23
www.axsne.net
Access Northeast has often adapted to changing market conditions and changing technologies, evolving in the past decade from ISP to a provider of network management services, with its data hosting and disaster recovery business powering recent growth.
Access recently completed a 6,000-square-foot addition to its data center — its previous space was sold out --with Northeastern University among the new clients.
President and CEO Rob Stephenson said regulatory requirements for data security and disaster recovery have helped spur growth, with businesses tapping Access because of its location in Marlborough.
“Public companies in particular need robust business continuity plans,” Stephenson said. “Our business model shows room for more growth there.”
One business benefit of outsourcing disaster recovery and business continuity is that those providers can be audited and certified as regulatory compliant, said Kerry Armstrong, vice president of technology consulting at Caturano & Co. in Boston.
Access secured additional financing in 2008. Greg Mulligan, founder of Bay Capital, which backed Access through its BCA Mezzanine Fund LP, said data continuity services “are falling more into the category of a must-have, not a luxury.”
“They continue to have a pretty interesting and decent backlog and hopefully with access to financing they can grow into those opportunities,” Mulligan added.
Maine
Bar Harbor Biotechnology Inc.
Bar Harbor
Sector: Genetic research tools
President and CEO: Robert S. Phelps
Employees: 6
www.bhbio.com/home
Bar Harbor is off the beaten path for just about anyone, let alone a fast-growing biotechnology startup. But Bar Harbor Biotechnology Inc. has embraced its location, with images of the remote coastal community adorning the product packaging it now ships all over the world.
Spun out of The Jackson Laboratory and aided by funding from the Maine Technology Institute, the firm launched its first suite of gene-expression-related products in 2007 and early 2008.
Last year brought a major partnership with Switzerland’s Lonza Bioscience, which is marketing the small company’s product lines around its own line of primary cell products. “It goes a long way when you have a sales force out there in labs with researchers, and talking about tying the entire research process together,” said president and CEO Robert S. Phelps.
The firm has three more products in the pipeline for launch over the next 12 months, Phelps said, including a launch targeting cancer drug developers, and is actively seeking to hire a bioinformatics curator and a chief scientific officer to guide growth.
Bar Harbor is one of a handful of startups in Maine with venture backing from outside the state, noted Catherine S. Renault, director of the Office of Innovation in the Maine Department of Economic and Community Development.
Maine firms that could be growing are desperate for capital, Renault said, adding that the state’s strong renewable energy sector may get a boost from federal stimulus funds. “A firm like Bar Harbor that has product in the market is in a much better position than earlier stage startups now,” she added.
Connecticut
VBrick Systems Inc.
Wallingford
Sector: Networked video solutions
CEO: Vince Graziani
Employees: 120
www.vbrick.com
In an era of instant messaging and blogging CEOs, many corporations continue to believe in the power of video, which helps explain why VBrick Systems Inc. continues to attract both customers and venture backing in the dreariest of economic environments.
VBrick, founded in 1999, closed an $11.9 million venture round late in 2008, with Menlo Ventures, Morgan Stanley and RedShift Ventures and others betting the Wallingford firm will continue to be a leader in the network video space.
VBrick’s solutions help store and distribute video over existing networks, something that is becoming increasingly valuable in difficult times, said Vince Graziani, VBrick’s CEO. “Companies want to communicate clearly and effectively to people in multiple locations,” he said.
VBrick has positioned itself to be able to grow through the downturn, said Richard L. Harris, general partner with Arlington, Va.-based RedShift.
The company remains strong in the education market, where federal stimulus dollars may help boost budgets, he noted, and is one of few competitors other than giants such as Cisco Systems Inc., to offer a full end-to-end video solution.
“They have a good strong balance sheet and are generating cash and racking up customer wins,” Harris said. “If you can keep doing that, you can survive the hard times.”
Vermont
Semiprobe LLC
Colchester
Sector: Probing and testing equipment
President and CEO: Denis Place
Employees: 4
www.semiprobe.com
Semiprobe LLC CEO Denis Place believes even in a dour worldwide economy, a company with better solutions can grow.
“We basically manufacture capital equipment, so we hear doom and gloom at times,” said Place, co-founder of the two-and-a-half year-old Colchester firm, which was incubated by the Vermont Center for Emerging Technologies. “But if you can come out with innovative designs that save money and solve a few problems, there are definitely opportunities.”
During 2008, Semiprobe significantly added to its roster of clients, which now includes defense giant Raytheon Co. and 30 other companies. Semiprobe tools — which can range in price from $10,000 to $1.5 million each — are used in any field where production and quality assurance require in-process probing. That opens up opportunities in emerging fields such as nanotechnology, solar cells and high-brightness LEDs, Place says.
Semiprobe is now in the market for some growth capital, a search that is likely to take it outside of Vermont.
Getting firms to the point where they can begin to seek those outside dollars, or as Semiprobe has done, demonstrate viability and forge strategic agreements and partnerships, is why the VCET was formed, said president David Bradbury, and that mission continues in good times and bad. “The next batch of fast-growth companies is being formed even in a downturn.”
New Hampshire
JitterGram Inc.
Bedford
Sector: Mobile messaging
CEO: Ric Pratte
Employes: 11
www.jittergram.com
With a name like JitterGram Inc. — as in “just in time” gram — it’s not surprising that the Bedford startup believes speed is important in its quest to become a leader in the mobile marketing space.
“Our vision is to be the national brand for text-based social mobile marketing,” said CEO Ric Pratte. “To do that, pace is important. We need to keep growing our sales and marketing effort.”
Founded in September, JitterGram is assembling a first round of venture backing, an endeavor described as “interesting to say the least” given the state of the economy and the capital markets.
Still, the startup’s solution, which uses personalized, targeted text messages with discounts or other marketing promotions which in turn are redeemed by showing the phone — is gaining traction with restaurants and other businesses in New Hampshire and beyond. The firm recently signed a New Orleans pizza chain after the owner began following Pratte on Twitter. “The pace of the mobile marketing space is amazing,” Pratte added. “All I can think of is the Net of the ’90s.”
Tim Platt, principal with Kinsman & Co. in Henniker, N.H., said Jittergram has found early commercial success, a key to helping convince backers the firm is positioned for leadership.
“Timing is everything in a venture like theirs,” Platt said. “You need to be out front to establish a brand and be able to convince early adopters on the advertising side this model has legs.”
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