SOUTHWEST FLORIDA'S TECH INDUSTRY IS QUIETLY EMERGING INTO ITS OWN
TOURISM, HEALTHCARE, REAL ESTATE and agriculture are among the industries most commonly associated with Southwest Florida’s economy. But there is a not-so-obvious and thriving sector emerging that promises to diversify the market as it develops. It’s the technology trade, and community leaders who have already noticed its growth are trying to make Southwest Florida a thriving hub. Some projects in place are well-known: Florida Gulf Coast University’s Emergent Technologies Institute, a new 6.5-acre development that will focus on renewable energy production and entrepreneurship; and the Southwest Florida Regional Technology Partnership (SFRTP), which has helped promote the region’s emerging tech businesses for nearly 10 years. Then there are others, like The RocketLounge, a Fort Myersbased incubator launched this year by an industry expert who believed in the area’s potential.
The companies helped by these programs stem far beyond information technology, or IT. They include educational, environmental, biomedical, financial and manufacturing tech. And while the number of these local businesses are nowhere near that of giant tech centers like Silicon Valley and Austin, Texas, professionals say certain components have led to increased interest.
“I’d like to think the opportunity to access an educated and skilled workforce in areas of technology—not just at Florida Gulf Coast University, but with other institutions of higher education in the region—has contributed to growth,” says FGCU President Wilson Bradshaw.
The SFRTP has been working with FGCU’s Lutgert College of Business to shape lesson plans and internships around the area’s existing tech field, says Marc Farron, who serves as the partnership’s president. It also cultivates talent from Florida SouthWestern State College, Hodges University, Keiser University and local high schools. The subtropical climate and easy lifestyle are also attracting entrepreneurs, says Marshall Goodman, CEO of Naples Accelerator, who moved from Silicon Valley in 2006 to help tech developers find their footing in Southwest Florida.
But while experts say they have witnessed an industry uptick, lack of venture capital makes it difficult for some of the businesses to sustain themselves.
“There is a lot of money here, but very often people are investing in companies that are not local,” Farron says. “If you are a tech person, you’re going to invest in tech, but the guys down in Naples may have been [corporate CEOs], or may have made their money in real estate, and they don’t necessarily know how to invest in tech companies because they are unfamiliar.”
However, Farron says, the mindset is changing as the industry becomes more sophisticated with higher education and outside resources. Gulfshore Business talked to three successful technology companies to learn about their experiences with the developing market. We also heard from area experts about what the industry has added to the area thus far, how it can help our economy in the future, and what these businesses need in order to prosper. —Melanie Pagan
LOCAL INCUBATORS AND ACCELERATORS ARE GIVING ENTREPRENEURS A LEG UP
IN ORDER FOR LOCAL LEADERS to nurture local tech businesses, theyneed to speak the language, which is quite different from that of many traditional startups, says Lois Knox, regional director of the FGCU Small Business Development Center.
“The tech entrepreneurs like that group-type atmosphere, where they can get together and talk with others like them,” Knox says.
Incubators and accelerators in the area are providing space for them to do that. Tech entrepreneurs of virtually any level can work with established professionals and likeminded peers to find information, exchange ideas and critiques, develop strategies and marketing plans, and connect to venture funds. Facility workers also train developers to act fast, because in the globally competitive tech industry, entrepreneurs are always racing against the clock to launch their innovations.
“Tech companies have a very short timeline,” says Marshall Goodman, CEO of Naples Accelerator. “You may have a product, but if you can’t get it financed in 18 months you’re toast, because someone has probably surpassed you. You need a team of people working with you to make that company successful today.”
Incubators and accelerators also help clients form strong business plans so they’re ready to pitch to investors or potential companies. And in Southwest Florida, they may only get one shot to do so.
“You kind of have to hit a home run your first time out, because you’re not going to get as many at-bats as you would in other parts of the country,” Goodman says.
Naples Accelerator offers 24/7 support, Goodman says, as does The RocketLounge, a recently established Fort Myers-based incubator helping tech industries related to healthcare, financial technology, real estate services and more.
Both places partner with local universities, high school and vocational schools to improve students’ tech skills and help keep them in the area post-graduation. They also connect with international markets to put Southwest Florida on the map and help clients eventually make a global impact.
Naples Accelerator has served more than 37 companies in the two years it’s been open and is essentially at full capacity, Goodman says. It’s currently seeking funding for a 10,000-square-foot expansion and creating a second facility in Immokalee, completely dedicated to foodrelated technology.
RocketLounge is just beginning, but CEO Dieter Kondek, who has worked with nearly 1,000 startups through accelerator programs in San Francisco and Europe, wants to expand its reach throughout Florida and create more programs for venture funding. The Horizon Council recently recognized the facility as an Emerging Business Leader finalist.
“More and more people are interested in us because they like what we are doing, mentoring these startups,” Kondek says.
IN ADDITION TO RUNNING The RocketLounge, Dieter Kondek leads insulinNG, a global company whose product uses biotechnology to detect a patient’s risk for Type 2 diabetes three to five years in advance.
Designed similarly to a pregnancy test strip, the self-testing device uses drops of blood to check for abnormal pro-insulin levels. (The pancreas releases increased amounts of the substance before a person develops diabetes,so this test can provide an early warning sign.)
“What we have developed is a pre-diabetesbase test. We test the level of pro-insulinper liter of blood,” Kondek says. The test tellsusers whether their levels are high or low ona positive or negative scale. If a case is positive,users are advised to seek further consultationand treatment from a doctor. The goalis to detect risk within enough time for usersto take precautionary lifestyle measures.
Kondek and his partners launched the product,which has been approved by the Foodand Drug Administration, in the hopes thatthey can curb the number of people at risk for Type 2 diabetes, which can lead to other health complications. “We have 29 million Americans now who are treated for diabetes, and the forecast is that we could be at 75 million because of unhealthy food [intake]. And the U.S. is not the worst country,” Kondek says.
The business began at the Naples Accelerator before moving its headquarters to The RocketLounge in downtown Fort Myers. In December 2015, the insulinNG team— which includes medical director Dr. Andreas Pfuetzner—received $300,000 from angel investors in the Miami area, after financing what they could on their own. They are currently seeking another round of investment from potential backers in Florida, New York and Germany.
With the initial funding, the insulinNG team is producing 10,000 tests to fulfill preorders from areas including the U.S., Canada, North Africa and parts of Europe. The company already has distributors in each of those areas, and plans are in the works to connect with Central and South America, South Africa, Asia, and more of Europe. The second round of funding would cover 25,000 more units plus a factory in Southwest Florida.
Kondek predicts $1 million in growth before the year is over, followed by $3 to 5 million in 2017. He hopes to create the local assembly- line production in the first quarter of next year. Job descriptions will vary, Kondek says, but employees can expect wages “far above the Florida average.”
Kondek and his team are also trying to establish a healthcare investment fund so others can invest in businesses like insulinNG, since obtaining early-stage capital is almost always a challenge. The goal is to eventually raise $20 to $30 million from local and international sources.
UNIVERSAL PAYMENTS company ACI Worldwide powers electronic payments for 5,100-plus organizations around the globe, including more than 1,000 of the largest financial institutions and intermediaries as well as thousands of global merchants. For those clients, ACI executes $14 trillion each day in payments and securities transactions. In addition, an array of organizations uses its electronic bill presentment and payment services. Through its suite of solutions, it delivers real-time immediate payments capabilities and omni-channel payments options (in-store, mobile and online).
And ACI’s client base is impressive. For example, nine of the top 10 banks in the U.S. are ACI customers, and five of the top six banks use ACI SaaS solutions. The company has a broad and integrated suite of electronic payment software solutions enabling payments processing for 125-plus billion consumer transactions each year, $14-plus trillion in payments and securities transactions each day and $117-plus billion in electronic bill payments each year. And ACI has an SaaS organization with more than 4,600 customers in the ACI cloud globally—24 hours a day, seven days a week, 365 days a year—monitoring and support. ACI has offices around the world to support its customers, which are based in 80 countries across six continents. It posted $1.046 billion in revenue last year, according to Dan Ring, vice president of public affairs. For businesses like ACI that base their operations in Southwest Florida, there is plenty of support and resources.
“Naples, the Gulf Coast and the State of Florida provide tremendous opportunities to companies with operations here,” Ring says. “And this burgeoning region is fast becoming a major technology hub due to its universities and growing pool of top talent.”
Looking ahead, ACI is bullish. “There is so much happening in the industry—from growth and developments in emerging markets to increased demand for SaaS solutions to numerous global markets moving toward real-time payments rollouts as well as the evolution of cross-border payments,” Ring says.
“In addition to these major initiatives that we are driving, we’re also focused on the eCommerce disruption opportunity. “
ACI recently launched its universal payment eCommerce Payments solution, which allows merchants to capitalize on the $2.2 trillion global eCommerce opportunity by embracing payments innovation.
“Our eCommerce payments gateway and anti-fraud offerings in particular are positioned well for strong growth in this massive online commerce market,” Ring says.
—Compiled by Phil Borchmann
GREG SCASNY CAN be blunt when it comes to the inevitability of cyber breaches.
“You can’t prevent them. I don’t care how much you spend,” he says. “It’s not a fair fight.”
But Scasny, who is CEO of Cybersecurity Defense Solutions, aims to put his clients at ease by offering products his firm has developed. The Fort Myers firm assists companies with network and data security to make it as difficult as possible for hackers to infiltrate a system. One method Cybersecurity Defense Solutions uses is penetration testing, which is a kind of show-and-tell approach. The firm, with the client’s permission, breaks into its system to illustrate how easy breaches can be and what the weaknesses of its protection programs. After the analysis, Cybersecurity Defense Solutions recommends products to greatly reduce the risk of future attacks, Scasny says.
“[It’s about] figuring out how to detect breaches and stopping them as they’re happening,” he says.
Other services include data recovery and cyber security awareness training. Since launching Cybersecurity Defense Solutions a few years ago, it has attracted clientele locally and across the country, from New York to Los Angeles. “We work with a lot of medical, financial and law offices,” he says. Although the Scasny doesn’t share revenue figures, he says the company grew 100 percent in its first year and expects it to increase 60 percent in its second. Scasny considers the region a great place for tech companies to thrive because of its higher-education institutions, technology training programs in the public schools, proximity to Southwest Florida International Airport and great lifestyle.
“There is a really cool entrepreneurial spirit here. We do have lots of talent,” he says. “To me, this is a place where you can stay and play, have a business and can raise a family.”
The word needs to get out, though. “There has always been a core of tech companies that nobody really hears about,” he says. “We have a problem with marketing our area.”
He says the growth of Southwest Florida’s technology sector will help spread the word, as well as diversify the economy. Cybersecurity Defense Solutions is currently building a 3,000-square-foot training facility within its current location to meet the needs of clients and the increasing demand for its services.
“There’s always going to be a need for cyber security,” he says.