The Next Big Thing

by Kelly Thompson and Michael Pierce
Photos by Jeff Jones

Tech development is an essential part of Toledo’s future. To make this future happen, however, our area has to overcome two significant barriers: A limited talent pool of people with these skillsets, and an aversion to taking risks when financing new business.

At age 10, Maumee student Jonathan Buchanan developed ChipTrading, a math-puzzle app that was picked up by the App Store in 2012. The University of Toledo’s Launchpad Incubation program has recently helped tech startups Roost, Petrichor and Hephaestus get attention from investors. Resources and opportunities for our tech community are springing up all over the city: Seed Coworking’s tech-based collaborative space resides in downtown Toledo and the Incubation program just hosted the most well-attended Pitch ‘n Pour event they’ve ever had. These events follow several decades of hard work and dedication from individuals who realized the benefits of pursuing technological development 15 or 20 years ago. But our city has more than just history or potential in the tech world; it has a future.

And this isn’t idealistic thinking; it’s a goal that is now a reality for young entrepreneurs in our region. Ask people like Bob Savage, president and fund manager of Rocket Ventures, who has helped more than 100 tech-based companies in the area find funding, providing monetary and commercialization assistance to startups all over Northwest Ohio. “We’re already starting to see people who used to be employed by our clients three to four years ago starting their own companies. The ecosystem is getting larger and more cohesive . . . there are incubators here that didn’t previously exist,” Savage said.


Changing with the times

The big draw to tech in 2014 isn’t in IT services or marketing, as it was in the early 1990’s. Instead, the landscape has changed to accommodate more idea-based technologies—in other words, instead of figuring out what line is unplugged from which port, developers are focused on solving problems by creating tech-based solutions that help improve workflow, social interaction or entertainment.

In this realm, our region is still playing catch-up. “Ideas that have existed since ‘04 or ‘05 are finally finding their way here,” said Gene Powell, president of SPOKE HQ. He formed the digital marketing agency in 2008, a decision he refers to as “building a liferaft” during the economic crisis, and co-founded Seed Coworking in 2012, a tech haven for young professionals in the region who are looking to build programs, learn new skills and collaborate with like-minded entrepreneurs. “Our city is finally embracing that, and getting out of the mindset that we need to copy what’s going on with tech on the east or west coasts. We can borrow ideas, but what we borrow has to get reshaped and become relevant to our region . . . the mind shift happens when the youth in our city decide to embrace their Rust Belt roots, instead of trying to shed them,” he said.

Tech giants Software Alternatives and Fox Software laid the foundation for this development, from the 1970s through the early 2000s. Savage refers to Docusphere (formerly Software Alternatives), an accounts-payable automation service, as “one of the area’s biggest success stories,” and it’s now a global enterprise. Based in Perrysburg, Fox Software merged with Microsoft, who sold FoxPro (a programming language) for both Windows and Macintosh operating systems from 1989 until it was discontinued in 2007. Despite this foundation, the move toward a progressive, of-the-moment industry has just begun. “You’re talking about a serious transformation that’s only two, maybe three years old, and it’s going to take time,” said Powell.


White Label Collaborative, Whisper Labs

Risky behaviors

In the tech world, a degree in the field isn’t necessary for real success. Take for example Josh Cooper, cofounder of White Label Collaborative and Whisper Labs, developer of the popular social gifting app Givt. A Sylvania native, he holds a juris doctorate from the University of Toledo College of Law. After buying two Vito’s Pizza franchises, Cooper got into tech because he “saw where the future was going.”

Looking ahead worked just as well for Cooper as it did for Powell, and he is now an advisor for Roost, the Toledo-based tech startup that saw recent success when they were invited to spend last summer at the Y-Combinator—an incubator located in Mountainview, CA, in the heart of Silicon Valley. The eligibility for venture capital puts them in the perfect spot for success and allows collaboration with more high-profile clients. And access to big money like that, says Cooper, is one of Toledo’s biggest hurdles. Venture capital availability requires finding institutions and/or investors who are willing to risk big money on startups that may fail. “I’ve raised money for two different companies here, and the second one did well; the first one didn’t. The problem is that not everyone will try the second time. It’s a risky mentality, and that’s part of the challenge that this region has,” Cooper explained. “Investors [on the west coast] will throw $1 million out there, almost expecting failure, and even if the odds of success are 1-in-10 , they’re bound to hit something eventually. The Midwest is much more careful with their money, and that can be a detriment to startups,” he said.


If you build it. . .

Savage, Powell and Cooper represent just three of several dozen of pioneers who have worked to develop Toledo’s entrepreneurial landscape, but they agree that the solutions to obstacles lie in education, more financial risk-taking and home-growing a talent base, rather than trying to attract people from outside the region.

Talent is often hard to come by for employers looking for fresh faces, but not because the region lacks intelligent or competent people. “It’s not a brain drain problem,” said Powell. “Anytime someone leaves one city for another, this happens. It’s a problem that exists everywhere . . . our issue is that we have too much work to do for the amount of people willing and able to do it.” Powell explained that when a large company like Roost gets serious funding, their next move is to scale up. When this happens, they’re forced to either find talent in Toledo or move to where the talent is. “The more companies like Roost that we can give birth to, the better. If we can be perceived as a place that’s capable of making extremely viable tech companies, people outside the market will gravitate here,” he said.

One of Cooper’s solutions is to provide relevant education, both in-person and online, to middle- and high-school students. “When we hire new people, we don’t care if you have ten years of experience. We’re looking to see if you have the necessary skills and passion to do the work. The pressure to go to college is, in some cases, counterintuitive to what’s actually happening in the workplace,” he said. For the student gifted in coding or who has an interest in computer engineering , not jumping headlong into a four-year degree may actually work in their favor. “The essential thing is growing the people who are already here, from the ground up. It will only take a few years, and it’s an investment in the future,” he said.

Tech entrepreneurship has a blossoming ecosystem already in place here that is now in a prime position to thrive. And if there is a concentrated focus on education and investment in the tech future of the Toledo area—if we’re not caught up in blaming ‘brain drain’ for the lack of talent—tech could be the catalyst that jumpstarts our region’s economy.