Order Reprints

Tech companies see growth in second half of 2009

WEST MICHIGAN - Despite a changing and challenging economy, some technical companies have experienced significant growth, adding permanent or contract employees, diversifying into new sectors and focusing on customer service.

Technology hiring activity has improved in the last half of 2009 with opportunities for candidates with experience and skill sets in applications, database and Web development, according to Beth DeWilde, principal and chief recruiting officer with Paragon Recruiting in Holland. She places candidates within a 50-mile radius of Grand Rapids.

Although there are many workers available for technical positions, sometimes companies wait for candidates with specific technology skills such as .NET, JAVA or C++, DeWilde said.

Companies in a variety of industry sectors that use technology to do business are hiring.

"There's still strong hiring in the consulting world — companies that support other organizations," DeWilde told MiBiz, noting businesses turn to consultants when it makes more business sense to outsource for technical needs.

Grand Rapids-based Open Systems Technologies Inc. is one of the largest information technology companies in Michigan, with $33 million in annual sales and 98 full-time and contract employees.

OST President Dan Behm said the 13-year-old company is having its second best year in history and expects to nearly double its sales in 2011 — envisioned by Behm as a "breakout year." OST focuses on three industry verticals — healthcare, manufacturing and financial, with about 50 percent of its work now in healthcare, including healthcare data centers. Hewlett Packard selected OST as the nationwide go-to for EPIC, software for electronic health records.

Behm said when businesses were reeling from the recession and economic collapse, Behm and founding partner Jim VanderMey, OST chief technology officer, opened up to employees to keep them informed about what needed to be accomplished to avoid cutbacks.

OST was previously owned by Troy-based GS Leasing before Behm and VanderMey made the decision to become an employee-owned company about six years ago.

"Primarily we wanted people to have pride of ownership in the company," Behm told MiBiz.

The turnover rate for OST is less than 5 percent a year, compared to an average of about 20 percent in technology companies nationally.

Although OST could be located anywhere in the country, Behm grew up in Grand Haven and thinks West Michigan is genuine. OST has successfully recruited "brilliant technologists" who stack up with the nation's best, he said. A fun environment and fully-funded benefits help the company to succeed and retain talent. Behm said attraction and retention are usually the top two problems for technology companies, but they're OST's top two strengths.

IT Resource

Coopersville-based IT Resource is another growing company. Since its founding in 2000 the company has grown 20-40 percent every year.

IT Resource's clients are usually small- to medium-sized businesses, ranging from manufacturing to financial companies, without robust IT departments.

Gary Lutz, senior partner at IT Resource said the company has completed some unique technology projects.

"Last year a customer in Chicago needed us to integrate a charter high school into its facility," Lutz said. That customer was allowing the charter school to use rooms inside its building as classrooms. IT Resource provided a secure network for the classrooms for students and teachers completely separate from the other systems in the building.

Lutz said about 80 percent of IT Resources' customers are from West Michigan, although some of the larger customers depend on out-of-state revenues. He said industry competition is stiff, although other companies are more focused on sales and hardware/software solutions as opposed to the customer service and support offered by IT Resource.

"We provide our service versus pushing a certain product or widget," said Carrie Borchers, sales manager at IT Resource. "We need to understand our customers' businesses first."

Lutz said in the next 12-18 months IT Resource plans to expand its customer base to many more U.S. customers. The company will introduce new service offerings in 2010 and is gaining momentum in several key technology areas, including unified communications, messaging solutions and disaster recovery solutions.

"I believe growth will come from organic growth, but we have some very large potential growth in the Midwest — Chicago and Wisconsin — as well as the southeast," Lutz said.

Qonverge

Muskegon-based Qonverge recently expanded into the Grand Rapids market with a new office downtown. CEO Jason Piasecki said the marketing and communications firm has clients in the Grand Rapids area.

"We wanted to strengthen our presence in the community and realized the best way was to have an office in the area," Piasecki said. With the addition of Remie Pleva, in business development in Grand Rapids, Qonverge now has 12 employees.

Qonverge has grown by expanding relationships with clients in healthcare, industrial, nonprofit and education. He noted many clients are cutting back on advertising in traditional media and investing more money in Web online videos and figuring out social media strategies.

Since Piasecki founded the company with Andy Maciejewski in 2006, revenue has doubled and the company now hosts more than 200 Web sites with a client list of over 300. Some clients turn to Qonverge to create a Web site that they can manage on their own with a content management system. For other clients, Qonverge serves more like their outsourced marketing department.

Mindscape at Hanon McKendry

Mindscape at Hanon McKendry, a Web development and interactive marketing agency, has also seen fast-paced growth. The company has averaged 39-percent growth in revenues in the last five years and expects to grow 30 percent this year, according to Mindscape co-founder Pete Brand.

The number of employees has grown since the company was founded in 2001, from four to 18 employees in 2009. Brand expects more growth ahead.

"I'm expecting significantly larger growth. We're on pace where it could be scary growth," Brand told MiBiz. "That's good because we have the infrastructure to handle it."

Mindscape has a good mix of clients, and never focused on vertical markets such as automotive and construction. The company made the decision to move from its base in Muskegon to Grand Rapids in March 2007.

"We started to realize that to grow the company we needed to get to a location where there was more access to talent," Brand said. Mindscape's employees are evenly split between programmers, designers, support staff and marketers.

Over the last 18 months Mindscape has led seminars about establishing a social media presence and developing strategies for Facebook and Twitter.

"A lot of it is demand. Everybody sees the need for having a presence online. Every company wants to be successful online, but don't know how to go about it," Brand said.

SpinDance

Holland-based SpinDance Inc. expanded beyond its automotive clients into areas such as household appliances before the latest economic downturn. SpinDance President Mike Ellis said business has been strong in 2009 because of this diversification.

"It takes a while to branch out and make the relationships. We grew fruit this year and have seen some pickup in the economy," Ellis told MiBiz.

SpinDance is a software development and consulting company with expertise ranging from software applications to real-time embedded systems at all levels of complexity. Ellis said his company is still involved with automotive projects that are in high demand, such as hybrids.

Since its founding in 2000, SpinDance has grown from two employees to more than 20 full-time and contract employees in 2009.

Wow Web Works

Portage-based Wow Web Works LLC, a Web development and marketing company, is up 10-15 percent in 2009. Company president John Clark said his 3-year-old company now has many repeat customers who want additional services and Web enhancements. Wow Web Works helps businesses stay abreast of opportunities in social networking. Typical clients include small businesses, professional services, builders and contractors.

"A lot of contractors and building businesses now realized they missed the marketing opportunity they need to have and stepped up to take care of the lagging issue," Clark told MiBiz.

He is optimistic about 2010 and already has 60 percent of the sales total from this year in the pipeline.

  Order Reprints

TAGS:

• economic development