Sunday, June 24, 2001
New Economy
Last word on tech scene
I'm not great at goodbyes, and this is the second time in five years I've had to write one in a technology column here at the Enquirer. My job is changing here, and I'll no longer cover what I have called the region's burgeoning technology industry.
The first time I said goodbye, in 1996, I was leaving the paper to try my hand at the Internet. I came back in 1998 because I love newspapering, and swore up and down I'd had my fill of technology and wanted nothing to do with its coverage. In 1999, in a moment of personal weakness, I found myself writing about it again.
How could I resist? Few of us did, or could. Back then the Internet was creating overnight billionaires out of young, cool, creative people we all wanted to be close to. Just as Cincinnati was pining for a piece of the action, I stumbled onto a community of startups in Over-the-Rhine and began covering them. There were parties and rollouts and free food, all-nighters and lots of coffee. The Chamber of Commerce and City Council showed up and promised support, hoping to catch lightning in a bottle.
Then the crash hit in April 2000. Startups that had hoped for venture funding found none. Worse, companies that had hoped for customers found none. At the beginning of 2000, I'd made a mental list of a half-dozen companies that I thought had a reasonable chance of going public by the end of the year. None is even close to going public today, and in fact, every one has had to dismiss workers to conserve cash. The Internet had looked like a playground, and everyone involved was grinning and wide-eyed like a bunch of schoolchildren on summer vacation. Today, it's a grim minefield.
The locals are plugging along, waiting for the tide to turn. Dan Meyer at Copernus told me something that's so commonsense I'm shocked I hadn't thought of it myself: It is the nature of leadership to be optimistic. No company locally has a chance if its CEO is singing the blues. So, every last CEO seems to be living out of hotel rooms, on the road, banging on doors, looking for customers, while the troops back home toil to make their company's services more useful and relevant.
A CEO remarked recently that the high-tech beat must be boring right now, what with nobody hiring and nobody getting funding. That's not the case at all. There's plenty to write about.
Cincinnati continues to get trashed in headline-grabbing rankings of the nation's best cities for high tech. I wish I could say I was 100 percent confident in Cincinnati's high-tech future. I'm not. Because technology isn't a fad, I think we'll always have boutique firms doing interesting work, and even now, there are small companies doing business on the Internet and making money.
Making money, it may seem odd to say, isn't enough. Somebody out there has to make lots of money. They have to make something that costs a dime and sell it for $10. It has to make a few hundred people filthy rich, so they can be fruitful and multiply, creating and funding the next generation of technology companies.
PlanetFeedback might be a tidy business someday, but theirs isn't a razor-and-blades business model. Synchrony Communications seems to have hit a wall. Many of the technology businesses you see here today are setting themselves up for acquisition, not for long-term independence. That's not necessarily a bad thing. Entrepreneurs are a restless bunch. Buy one out for a few million dollars, and chances are he'll go out and start another business. Ask Mahendra Vora at Intelliseek, his fourth company.
A fleet of dinghies, however, doesn't add up to a flagship, and that's what Cincinnati needs. That we don't have one isn't for lack of trying. Broadwing aspires to be the region's technology leader, but its executives have a hard time speaking plain English, so it's hard to say exactly what the company does or who it's leading where.
And I'll give local community leaders a little credit for recognizing that Cincinnati's economy needs to change. But right now, a little credit is all they'll get. I had high hopes when Procter & Gamble CEO A.G. Lafley said the region needed to support its technology industry, and threw his company's weight behind his words. Subsequently, the chamber-led Regional Technology Initiative launched a 100-day push Jan. 2 to develop a technology policy for the region. It was a bold move that said this won't be politics as usual.
Right now, we're at 160 days, and we haven't seen a plan. Granted, when the riots hit, anyone who stood up and said Cincinnati was a hospitable place for technology or anything else would have looked foolish. Regardless, there's no sign of the plan only talk of things happening behind the scenes. It's beginning to look like politics as usual. If the chamber doesn't act soon, it'll find itself spending more time talking about what took so long, and less time talking about the plan and the commitment needed for its implementation.
Do I sound pessimistic? Some leader I'd make. Then again, all I have is this keyboard. There are people out there with some real resources trying to make things happen: George Molinsky at Main Street Ventures, Johnathan Holifield at the chamber, Wayne Hicks at the Black Data Processing Associates, Tony Shipley of Queen City Angels, and dozens and dozens of entrepreneurs.
In their own way, they're all living out something I believe: When it comes to a high-tech future, Cincinnati doesn't have much of a choice. The reason we want a strong technology industry is because A) the cornerstones of our economy (such as Fifth Third, P&G and GE Aircraft Engines) need a technology-savvy work force to remain vital, and because B) technology workers tend to be better educated and make more money. When we have more workers like that, not only will our economy benefit, but so will our schools, our hospitals, our churches and all our institutions. We're nowhere if we're not in this game.
To be a player, there are some basic problems to solve. As a percentage of population, Cincinnati has fewer high-school graduates than Columbus, Cleveland and Indianapolis not to mention San Jose, Seattle, Denver and Washington, D.C. And then there's the diversity issue, and it goes beyond skin color and ethnic background. This uptight town has to learn to embrace a diversity of ideas, as well.
Fix those problems, and we'll be the envy of the nation, even if we never produce a computer chip or a line of code.
John Byczkowski is the Enquirer's enterprise and database reporter. E-mail him at johnb@enquirer.com or call (513) 768-8377.
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