Historically a blue-collar industrial area, the South Sound is typically not known as a region where blossoming tech startups want to put down roots. The region may just be a stone’s throw away from the global tech hubs in Seattle and Bellevue, but currently it’s not one where massive numbers of tech companies have decided to call home.
But with its lower cost of living, calmer traffic, and the business-friendly attitude from many cities that offer incentives and support to small-business owners, some techies have taken notice and chosen cities like Tacoma and Olympia in favor of their more-saturated northern neighbors.
Such is the case for cloud-based software company cloudPWR, based in Tacoma and led by serial entrepreneur Shadrach White. Though Tacoma has yet to have a well-established tech sector or many investors interested in funding tech companies like cloudPWR, White said the area just made sense as his small company’s headquarters when he expanded it out of his Olympia garage in 2013, two years after its founding.
“I thought about (expanding to) Bellevue, Seattle, or Redmond, but the cost of living was just prohibitive, and the cost of recruiting talented employees and competing with the Amazons and the Googles and the Facebooks was also prohibitive,” White said. “Here, we’re lucky to be able to pull . . . (from) the large number of people who are spending upwards of two and a half hours of their day traveling to Seattle to find jobs. Our ability to attract a better work-life balance is a big benefit.”
The business, which has been made up of seven people for the last four or so years, specializes in bringing cloud-based technology solutions to governmental operations. This somewhat-amorphous concept has taken on myriad iterations, the most high-profile of which has been in the marijuana industry.
“(In 2013), I convinced (the Liquor and Cannabis Board) that if we built a licensing process on the cloud, it will be efficient and safe and easy to turn off if the law got turned around,” White said, speaking about the aftermath of the passing of I-502 in November 2012. “We were just in the right place at the right time and became the first cloud-based technology that the state of Washington ever implemented.”
The cannabis angle, however, was more of a happy accident for White, who said that he has “no dog in that hunt” as far as marijuana goes. Rather, the company was created to streamline governmental processes that can get bogged down in manual paperwork into agile, lean, and adaptable cloud-based systems.
“I founded (cloudPWR) to find areas where we could create a more efficient government,” White said. “I knew that it would take a lot of time to convince the government that the cloud is safe, so I staked my claim early, created a track record of success, and waited as it became more and more acceptable. My approach to building this business has been very methodical and measured.”
This attitude of patience in business, White said, is largely a result of his seasoned career as an entrepreneur — cloudPWR is his fourth startup. As a younger entrepreneur, he said that he got caught in the “hype-cycle mentality,” the idea that if your project isn’t an overnight success, there’s something wrong with it.
“I learned that the truth is that quality things are very rarely built overnight, or even quickly,” he said.
That steady and practical approach to long-term success also defines the attitude of the Olympia-based company 6-4-3 Charts. Like cloudPWR, this small business with seven employees focuses on providing precise technical solutions to an area where leaders saw a need for a more efficient process: baseball.
“Two years ago, I was on a bus going to regionals, and I had two computers up trying to manually create reports I needed,” said Derek Weldon, a baseball coach with 15 years of experience. “I turned to one of our other coaches and was like, ‘There’s got to be a better way to do this.’”
And there was. With the help of Tim Kuhn, Weldon’s longtime friend and a business professional, and Rick Ahlf, a young developer who played for Weldon as a student at Timberline High School, 6-4-3 Charts was born. The company delivers easy-to-read spray charts and hitting and pitching charts to baseball and softball coaches: objective information that, when compiled correctly, can help coaches shift strategies and win more games.
“When I was doing all of this manually, it would take me 10 hours to prepare for each opponent,” Weldon said. “You spread that out over a whole season, and you’re playing 20-30 games — that’s a lot of time.”
Instead of this extended manual process, Ahlf, the company’s CTO, designed software that compiles that data and generates easy-to-use PDFs. Weldon knew they had hit a gold mine by creating a genuinely useful product.
In its first year, the company provided charts to 25 percent of Division I baseball teams. But that success hasn’t led the company to get overly ambitious. Like cloudPWR, 6-4-3 Charts wants to grow intentionally and incrementally.
“This year, we expanded to serve D-2 and D-3baseball teams, and D-1 softball, as well,” Weldonsaid. “Next year, we’ll be going into D-2 and D-3 softball. We want to continue to scale it up at the appropriate rate and only bite off what we know we can chew.”
And, like it is for cloudPWR, this measured growth is complemented by the quieter and less-congested nature of Olympia.
“The area is consistently growing, and I think the success of tech business — and small business tech, for that matter — will only continue to expand south to Lacey and Olympia from the Seattle and Bellevue areas,” Ahlf said. “Up north, (the commute) is draining on employee morale and expands the work day from an eight-hour shift to nearly 10.”
Removed from the exhausting hours, fast pace, and cut-throat competition that define much of King County, tech companies in the South Sound are able to build strong foundations that establish them as more than a flash in the pan. These small businesses are determined to provide long-term solutions rather than quick-fixes.
And the high quality of their work and lack of crazy-making commutes might beckon other emerging tech companies to do the same.
If you’ve always wanted to be an entrepreneur, like White, or are thrown into the business game with a good idea, like Weldon, consider these tips from John Rodenberg with Washington Small Business Development Center (WSBDC) before you get started.
◉ Take the steps to translate your great idea into a business plan. This should include a market analysis, a product description, and an identification of the target market.
◉ It’s good to have your own equity invested — having skin in the game shows investors and funders that you’re serious.
◉ Pay attention to your margins, and learn how to manage them. This isn’t simple, so consider taking a profit mastery course.
◉ Don’t shortchange your marketing budget. Factor in the money you need to reach your target market and meet certain industry benchmarks.
The WSBDC is made up of 28 professionals who help small businesses make plans, grow, track results, and more for no cost.