Recently the Technology Association of Georgia started accepting applications for its Excalibur Awards. According to TAG’s Excalibur website: “The TAG Excalibur Awards… recognize the companies and organizations throughout Georgia that demonstrate the best use of technology to solve their business problem. These companies and organizations do not produce technology, but they rely on it and are using it creatively to excel.” This is the classic definition of a technology-enabled company.
By contrast, the criteria of TAG’s Top 40 Innovative Company competition recognize only companies that produce technology. According to the 2012 Top 40 web site, eligible companies must be “’technology’ focused (in other words the company’s primary focus would be the development and dissemination of technology).” This is the classic definition of a technology company.
But which award might be appropriate for companies whose primary focus is to leverage their own proprietary technologies as an integral part of their business, rather than merely to solve a challenge or problem? Interestingly, in Georgia, those companies usually have been recognized as technology companies by the Top 40, even though they do not disseminate the technology to third parties (and thus technically do not meet the Top 40 requirements).
I think this is the right approach, and apparently Marc Andreesen would agree. In the May 2012 issue of Wired, he stated that his Silicon Valley venture capital firm, Andreesen Horowitz, would invest only in what he called “primary technology companies.” Airbnb was his example of a “primary technology company.” Airbnb is a “startup that let’s you rent out your home or a room in your home.” Like me (and probably many of our readers), the interviewer, Wired Editor in Chief Chris Anderson, expressed surprise that Andreesen would characterize Airbnb as a “primary technology company.” Andreesen answered: “…everything inside of how Airbnb runs has much more in common with Facebook or Google or Microsoft or Oracle than with any real estate company. What makes Airbnb function is its software engine, which matches customers to properties, sets prices, flags potential problems. It’s a tech company– a company where if the developers all quit tomorrow you have to shut the company down. To us, that’s a good thing…. I think Airbnb is building a software technology that is equivalent in complexity, power, and importance to an operating system. It’s just applied to a sector of the economy instead.”
In the June 1, 2012 online edition of Information Week, Rob Preston, its Editor in Chief argues that for many companies, IT is not some non-core function that can be outsourced. Instead, IT is intertwined with the business of the enterprise. He notes: “Scores of companies, including NYSE Euronext, Sears, United Stationers, The Associated Press, Zynga, Google, and Union Pacific, not only are innovative users but also committed builders and sellers of IT systems, software, and services.” The quote caught my eye because of its reference to United Stationers, the wholesale supplier of all of the 40,000 products that Group Office Buys sells. And to think I always considered them merely the outsourced supplier of office products to our business.
Every year, in the Top 40 competition, we consider whether certain applicants qualify as technology companies. Indeed, with our criteria, how do we justify having selected Podponics, which grows and sells lettuce, as a Top 10 winner? If you attended TAG’s Summit, you may recall that the audience agreed, awarding Podponics “Best of Show.” From their website: “We [produce] local food … in urban centers, using an approach that does not require arable land.” The PodPonics system grows crops inside former shipping containers, without soil, sunlight or pesticides.
The founder and CEO is Matt Liotta, who studied computer science at Emory. After a variety of jobs in the technology and telecom fields, Matt decided to apply his technological expertise to hydroponic growing. Interestingly, in domestic markets, Podponics appears more focused in growing and selling organic produce than licensing their systems to others, so the committee and audience were not recognizing Podponics for disseminating technology to others.
It turns out that proprietary software is essential to growing produce in containers, and the founder’s tech experience has led him to Podponics. Perhaps the emphasis of our Top 40 criteria on dissemination is misguided, or at least too limiting. No one disputes that Facebook is a technology company, but its focus is not on disseminating technologies; it leverages its own technologies.
So maybe this issue isn’t as difficult as it seems. Perhaps eligibility for the Top 40 competition should also include Marc Andreesen’s test for a “primary tech company:” a company where if the developers all quit tomorrow you have to shut the company down.