May 12, 2011

Growing Young Tech Firms Searching For Talent

Ashley Fletcher Frampton  /  Charleston Regional Business Journal

Nate DaPore rattles off a growing list of benefits that his North Charleston-based software company, PeopleMatter, is offering its employees.

An unlimited vacation policy, stock options, fully paid insurance, benefits for domestic partners, the option to bring pets to work or have them sent to day care, a one-month paid sabbatical for employees with three years of service, a 401(k) match from day one, a gym in the building, free snacks.

The load of perks is growing along with PeopleMatter, founded in 2009. So far this year, the company has grown 25%. DaPore expects to grow from 45 employees to 100 by the year's end, and then to double again in 2012.

PeopleMatter is trying to create a Silicon Valley culture in Charleston, in the types of benefits offered and in the workplace atmosphere, because it is competing with that region for talent.

The company began launching its talent management software for service industries last year, and business is growing rapidly. This month, the company announced $7.2 million in new funding, adding to $7 million previously raised.

This summer, the company will open a satellite office in San Francisco for operating advantages that include access to that area's workforce. But the plan is for PeopleMatter to remain headquartered in North Charleston, DaPore said, and that means his need to recruit top talent to the Lowcountry will remain.

He is not alone in the effort. A handful of technology startups in the Charleston area are on the cusp of major growth, and many identify a common challenge: finding talented workers to keep up the pace of their expansion.

Startup companies' leaders say Charleston isn't always on the radars of software developers and other technology industry professionals outside the region, and some of the young firms don't have time and resources to launch serious out-of-state recruiting efforts.

"We can't graduate them fast enough, and we can't hire them fast enough," said Ernest Andrade, director of the Charleston Digital Corridor, a public-private partnership that supports the growth of knowledge-based companies.

**The next 10 years
**Andrade said that when the city of Charleston and a then-smaller tech community formed the Charleston Digital Corridor 10 years ago, the main goal was to attract knowledge-based companies to the area and help them once they got here.

Now, that goal is shifting.

"The next 10 years should be about basically building a robust level of talent," Andrade said.

The Charleston Digital Corridor's most visible initiative in the past three years has been the development of incubator space in downtown Charleston for startup companies or those relocating here. The first incubator project, called the Flagship, opened in 2009 at Calhoun and East Bay streets, and the adjacent Flagship 2 is set to open in the coming weeks.

While that effort continues, moving forward, the organization could also take on a marketing role in response to members' needs, Andrade said.

Planning is preliminary at this point, Andrade said, but marketing efforts will build on a website unveiled last year, called CharlestonWorks, that is meant to be a hub for available knowledge industry jobs.

One likely goal is getting the message about Charleston's high-tech job market out to graduates and midcareer professionals in other regions of the country. Right now, most traffic on the jobs website comes from South Carolina and the Southeast.

Other strategies could include working more closely with colleges in the area to increase the number of local computer science graduates.

On an individual basis, many of the area's software firms are offering attractive benefits and touting small, laid-back work environments where newcomers can make big contributions.

Local tech industry leaders have said for some time that part of the message they are trying to spread to would-be candidates in other areas of the country is that Charleston is a place where technology professionals can find plenty of career opportunities –- not just one job.

"I think the biggest challenge is, 'What other options do I have in Charleston if this doesn't work out?' " said Kevin Eichelberger, CEO of Blue Acorn, a Mount Pleasant-based software firm that provides e-commerce services for retailers.

Eichelberger said that about six years ago, he passed on job offers from two larger and more established software firms in town, Benefitfocus and Blackbaud. He knew himself to be entrepreneurial and didn't see many small software firms like his own in the Charleston area then. So he took a job in Atlanta.

But now, the technology landscape is different in Charleston, he said. To some extent, it's because the larger firms, which have higher profiles and more resources for recruiting, have brought in workers who later left to start their own ventures.

"This is the next wave of companies," Andrade said.

Those larger firms also have been a source of employees for the next-
generation firms.

"There are a lot of options" in Charleston now, Eichelberger said. "I think people just don't see the visibility of the tech community in Charleston. It isn't as visible as it is in other cities."

As his and other startup firms are finding, though, the growing number of options, at companies large and small, means more intense competition for talent.

**Growth stories
**Eichelberger moved Blue Acorn to the Charleston area about 2 1/2 years ago, shortly after starting operations in Atlanta. He chose to put down roots in the Lowcountry for its quality of life, including the lack of long daily commutes.

Now the company has 13 employees, up from nine a couple of months ago. Three more are set to start soon, and recruiting is under way for six more employees, Eichelberger said. He plans additional hiring in the second half of the year but doesn't yet have firm numbers.

Blue Acorn's success over the past three years has come despite a downturn in consumer spending. Eichelberger said the growth might actually be a result of that downturn, as retailers have sought new, more results-oriented approaches to online sales.

A focus on measuring results also has helped BoomTown, a real estate marketing platform that helps agents attract and manage their leads.

"The product that we create actually brings them business, and because of that, it makes them a little bit more efficient," said Rebecca Guthrie, operations manager.

President Grier Allen, a Charleston native, was part of a three-person team that started work on the software product in 2007 and launched it in 2008.

Now, BoomTown has about 25 employees, and it has postings for five additional jobs.

The company is hiring for positions that include client services support, software engineering, quality assurance and operations, Allen said. He said the needs are "across the board."

No matter the recruiting challenges, Allen said he is committed to growing his company and the tech industry in Charleston.

"This is where I grew up, and I wouldn't leave here for anything," he said.

DaPore, who also grew up in Charleston, worked for Benefitfocus for eight years before leaving to pursue his vision. His software helps service industries manage hiring, training, scheduling and other employee needs.

For several months early on, DaPore and three others worked out of the Flagship incubator before moving to permanent space in North Charleston.

**The go-getters
**Mark Phlieger moved his mortgage-industry software firm, Avista Solutions, from Columbia to Charleston in 2009 for the culture, lifestyle and technology community.

His firm is also hiring, and he thinks the quality of life in the area will work to his advantage in recruiting.

SPARC, a software product development firm that is not quite 2 years old, is hiring "aggressively," said CEO Eric Bowman, declining to cite figures. Charleston's high quality of life has been a major factor in attracting talent, he said.

But while the Lowcountry lifestyle is an advantage, some say candidates are looking for more. For example, Bowman and Eichelberger said applicants ask about community groups for technology professionals.

"Usually your all-stars are going to want those kinds of communities where they can go and speak with other people," Bowman said. "The go-getters want that. So that's obviously the kind of talent, the A-players that you want."

And getting the attention of talented candidates in the first place is an ongoing challenge, Eichelberger said. Sometimes he has to post jobs again and again in hopes of getting applicants who have the right skills and who will be a good fit.

On average, for software developer positions, it can take two to three months to find the right person, sometimes longer. Resumes can be slow to trickle in, especially from local applicants.

"It's a pretty dismal response rate for what I consider a pretty darn good job if you're a developer," Eichelberger said.

DaPore said The Boeing Co.'s presence in North Charleston could help build the technology community.

"Boeing is going to be a tremendous catalyst for this," he said, "because those are going to be sophisticated jobs that do have a large technological angle."

He added, "I think we're finally moving out of being just a little tourism town, a tourism and port town in Charleston and really developing a vibrant third economy here, which is around the tech community."