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VOL. 37 | NO. 12 | Friday, March 22, 2013

Desperately seeking techies

Middle Tennessee’s growing reputation for innovation is hindered by shortage of tech talent

By Brandon Gee

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Nashville has struggled for years to recruit and retain technology talent, partly because Tennessee doesn’t grow much of its own.

The problem is so prevalent that the Nashville Area Chamber of Commerce recently launched a campaign to attract technology talent to Middle Tennessee.

To make the case for this talent search, look no further than technology startup Moontoast, a social media commerce company that was founded in Nashville but has since, out of necessity, split operations between here and Boston – a well-established tech city that can hold its own with San Francisco and New York – as it has grown.

As recently as 2007, there were 1,254 open technology jobs in Middle Tennessee, according to the Nashville Technology Council, and the state ranked 46th in percentage of science and engineering higher education degrees conferred, according to the U.S. Census Bureau.

The number of open technology positions is lower now – 836 in the fourth quarter of 2012 – but more than half have remained unfilled in excess of six months.

Meanwhile, the Chamber’s most recent workforce study predicts the technology industry in Middle Tennessee will grow an average of 4.4 percent each year.

Even if Tennessee increases its own supply of tech graduates, the problem is complicated by the fact that the vast majority of openings are for mid- to senior-level positions that require professional experience, necessitating the need to steal established tech talent from other parts of the country.

Heavy on the science

Science and engineering degrees as a percentage of all higher education degrees conferred by state, 2007

RankStatePercent
1 Wyoming 53.3
2 California 43.9
3 Vermont 40.9
4 D.C. 40.4
5 Maryland 40.4
17 Massachusetts 33.6
46 Tennessee 25.3
47 Missouri 25.1
48 North Dakota 24.6
49 West Virginia 23.6
50 Arkansas 23.2
51 Arizona 18

“We are entering a time when developers and technology professionals are going to be in high demand – they already are – and Nashville is competing not only nationally, but internationally for talent,” says George Lazenby, CEO of Emdeon and chairman of the Chamber’s volunteer task force that developed the campaign to recruit tech talent.

“A strong message and successful outreach to this demographic is vital to our future success.”

Moontoast’s story

Most of Nashville’s technology companies, like Emdeon, have sprouted in support of Nashville’s No. 1 industry: health care.

When it was founded in 2008, Moontoast was accompanied by the promise of being Nashville’s first big social technology “win,” with a particular focus on the industry No. 1 in the city’s heart: music.

Other Nashville technology companies

  • Yurrow.com: Local online marketplace for freelancers
  • Alltech Inc.: Provides information technology staffing solutions
  • Bondware Inc.: Provides professional-level web features to clients with limited Internet budgets or design resources
  • BorderJump: Assists in international sales with services such as export compliance and global shipping and logistics
  • Document Solutions Inc.: Provides a range of technology-driven services for the legal industry such as electronic discovery and computer forensics
  • Emma Inc.: Web-based email marketing and communications service
  • Industrial Strength Marketing Inc.: Business-to-business interactive agency whose services include social media and web-based email marketing and communications
  • Magazines.com: Internet-based magazine subscription service
  • [meta]marketer: Web marketing and services company
  • Peak 10: Data center whose offerings include cloud services, systems management, managed storage and data backup and restore
  • PureSafety: Provider of online safety training and risk management solutions
  • 11 Social: Boutique digital marketing and public relations company
  • Rockhouse Partners: Technology-based entertainment agency helping sports, music and other entertainment properties engage and activate fans
  • Keystone Business Solutions: Provider of web development services including design, consulting, content management system implementation and training, search engine optimization, hosting, email and Internet marketing

Source – Nashville Technology Council

To a large extent, Moontoast is fulfilling that promise. The company was ranked No. 2 on Billboard’s list of “Top 10 Music Startups of 2011,” and co-founder and chief technology officer Marcus Whitney was named “CTO of the Year” in 2012 by the Nashville Technology Council.

But as Nashville has celebrated Moontoast’s successes, it also has had to share the spotlight. The company’s news releases now include Boston in the dateline, as well as Nashville.

Moontoast split operations when CEO Blair Heavey joined the company.

“When the company decided they wanted to start to really expand, two-and-a-half to three years ago, a board member said they needed a leader in Boston, New York City or San Francisco, so we could merge their startup ecosystems with what Nashville certainly aspires to grow into,” Heavey says. “Certainly there’s tech talent in Nashville, but not as plentiful as Boston.”

Moontoast provides clients such as record labels Sony, Universal and Taylor Swift’s Big Machine with immersive, interactive marketing campaigns conveyed through the brands’ social media accounts.

For example, a “social rich media unit” is posted on a brand’s or artist’s Facebook news feed and includes a music video or slideshow that grabs the attention of Facebook users, who also have the ability to sign up for product updates and make purchases.

“The offering they have is really fantastic,” says Les Wilkinson, managing director of Nashville-based The Martin Companies, Moontoast’s lead investor. “Everyone is still trying to figure out social, and we think Moontoast has gotten it.”

Clients now include huge names such as Lexus, Procter & Gamble and Nike, in addition to the music companies that gave Moontoast its start.

“We still have our Nashville country (music) roots, no question,” Heavey says. “I wouldn’t say it’s our bread-and-butter, but we focus on all affinity brands. Those are brands that really have a fan-base, where we hope to continue to build up relationships.

“As consumers spend more time in social and mobile environments, we give brands the opportunity to interact with them in that space. A consumer has gained more power over the brand than vice versa. Why would a consumer want to have to go to some brand’s main e-commerce website to interact with the brand? It’s silly.

“The consumer is already on social and mobile platforms. It’s up to the brands to reach out to the consumer if they want to interact and build a relationship with them.”

More openings for Boston

Moontoast’s products are accompanied by a rich analytics suite to show clients how well their campaigns are working, and Wilkinson says the market for analytics work was much better in Boston than Nashville.

Heavey says Moontoast’s operations are pretty evenly split between Boston and Nashville, with a, additional handful of folks in Silicon Valley.

It is telling, however, that after the company raised an additional $5 million from Nashville’s The Martin Companies earlier this year, it posted nine job openings on its website: eight in Boston and one in Nashville.

But Heavey and Wilkinson say Music City shouldn’t worry that a company born in Nashville and primarily funded by Nashville investors will pack up and leave entirely.

They speak highly of Moontoast developers in Nashville, noting all three of the company’s founders are from Nashville and one of its most important leaders, Whitney, remains here.

“We owe a lot to the music industry because the music industry was some of our first clients,” Wilkinson says. “Everyone is aligned in their desire to make this a Nashville win, and a Boston win for that matter.”

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