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Local tech industry regaining pulse despite lingering national downturn
RightNow Technologies http://rightnowtech.com/ has started hiring software engineers again.
The company, often considered Gallatin Valley’s showpiece for hi-tech businesses, grew amply from its foundation in 1995 through 2000.
By KAYLEY MENDENHALL Chronicle Staff Writer
But in 2001, like many tech companies, it hit a slump. RightNow executives laid off 63 employees last year and asked the chief operating officer to resign in Feb. 2002 to help balance costs against a lagging national economy.
"We were hiring like crazy. We had just come off a 500 percent growth year," said Sean Forbes, the company’s new vice president of marketing and business development. "Keeping an eye on our business, we couldn’t maintain the hiring we had done looking at where the software industry was leading."
But thanks to actions taken to reduce costs, and constant commitment to product development, Forbes said the company has enjoyed 15 straight quarters of revenue growth and had more cash at the end of last quarter than at the beginning. RightNow recently hired 14 software engineers and is ramping up its communications and public relations departments as well.
Although nationally the death of tech is still crippling the job market and the stock market, the local hi-tech scene has a pulse. Some companies are almost glowing with excitement, some are quietly keeping contract negotiations to themselves and some are just happy to hang on.
"We are not out of the woods," said Larry Johnson, founder of ILX Lightwave http://www.ilxlightwave.com . "I think we can kind of see a clearing ahead."
ILX makes production equipment for companies that make fiber-optic components. About half of the company’s clients are in the telecom industry, a sector that is still declining nationally. Since June 2001, ILX has laid off 127 employees in Bozeman, the last round taking place in May.
"Our business is down tremendously in the last two years. It’s down 75 percent," Johnson said. "Most companies don’t survive a downturn like this."
ILX has a specialized product that depends on a healthy telecom industry. Some local software companies, on the other hand, have broader sales markets to explore.
Forbes said RightNow’s product — a software package that constantly updates the frequently asked questions part of company Web sites — has been sold to 1,100 customers with many more to draw from. The going price of RightNow Web is about $100,000.
"There are 25,000 more companies that should be using our stuff," Forbes said. "There is a big, green field that plenty of others recognized but they tripped and fell down. They overpromised and underdelivered."
By hiring new engineers, RightNow is showing its commitment to research and development of improved product ideas, Forbes said. Idea roots have been taking hold and inspiring many new businesses in town during the downturn.
"Despite what’s going on in the national economy, we are still seeing some great success stories in the Bozeman area," said Alicia Bradshaw, executive director of the Gallatin Development Corp http://www.bozeman.org . "We continue to see new companies created."
A variety of biotech and software companies are sprouting up throughout the valley from Bioscience Laboratories http://www.biosciencelabs.com/ and Golden Helix in Bozeman to IAC in Three Forks and Little Apple Technologies http://www.littleappletech.com in Manhattan, Bradshaw said.
One of the GDC’s showpiece new businesses is Infogears.com, http://www.infogears.com a local start-up that completely overhauled the non-profit’s Web site. That was just one of 30 new customers in the five months since Infogears started selling its product package, said co-founder Craig Delger.
Delger and his partner, Rusty Conover, started developing ideas about two-and-a-half years ago. After working in the tech industry from the software development side to the marketing and sales side for years, Delger wanted to move back to his native state of Montana.
"I saw the economy going down and thought now is as good a time as any to get back where I want to be," Delger said. "Technology is very cyclical. You want to think about the next big thing during a low cycle, so when it comes back you’re already going."
Infogears is much like RightNow in that it sells its products to a wide range of businesses looking to become more efficient — making it almost "recession proof," Delger said.
When it comes down to it, business is business, even in the hi-tech world.
"If you can build something that makes business better people will buy it," Forbes said. "Everywhere we go, we go in and we have to sit down in front of a CFO or an accountant and they say, ‘Tell me about your software,’ and they don’t want to talk about bits and bites. They want to talk about dollars and cents."
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