Full Circle

How Vermont became a center of technology innovation

by Virginia Lindauer Simmon

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In 1790, Samuel Hopkins of Pittsford was granted the first U.S. patent ever awarded. It was for an “improvement, not known before ... in the making of pot ash and pearl ash by a new apparatus and process.” Of course, that’s only a morsel of information, with no genuine cause-and-effect, but it’s kind of fun to ponder a connection to the state’s growing abundance of technology entrepreneurs.

In January of this year, the website techie.com named Burlington one of the country’s 10 most promising technology hubs to watch in 2014. Among the benefits mentioned were the BTV Web App Group; Laboratory B, a local hackerspace; the annual Vermont Tech Jam sponsored by Dealer.com, among others; and Front Porch Forum.

We wondered how this came about. We know that 60 years ago, Greater Burlington Industrial Corp. was incorporated and the search was on to bring employers to the area following the tragic closing of three textile mills in Winooski that left 1,000 people jobless. This effort led to the opening of the IBM manufacturing facility in Essex Junction three years later.

Other technology enterprises followed, notably IDX Systems, a healthcare software technology company launched in 1969 and later acquired by GE Healthcare; and in 1978, Digital Equipment Corp., which opened a manufacturing plant in what’s now known as Technology Park. It closed in 1992.

Whom to ask

It made sense to phone Jeff Couture.

Couture calls himself “a local boy.” He graduated from Burlington High School and studied communications and business at the University of Vermont. After graduation in 1977, he worked in the UVM public relations office for five years, then joined IBM in 1982.

At the beginning of this year, Couture left his position as manager of communications and public relations at the IBM Microelectronics Division to become executive director of the Vermont Technology Alliance (VtTA).

VtTA was founded in 2004 as the Vermont Software Developers Alliance by a group of software companies such as Dealer.com seeking to support one another. It changed its name in 2012 to reflect its expanding involvement in issues and goals beyond software.

The roots

“Over the years, having larger employers such as IBM, GE in its heyday, even Digital Equipment — they provided sort of a seedbed for starting other tech-related companies in the state,” says Couture.

“When I think about it — what I’m doing now — there’s been a change even since 2004, and that is the whole growth of the software development businesses that are based here and have taken a foothold and started to grow. And newer technical companies like Logic Supply that combine both software and hardware, and others like Eastman Benz — both Dan Eastman and Karl Benz had IBM roots — have started.”

Couture believes, though, that simply the appeal of Vermont has had great influence in the rise of software development. “To some extent you can do this type of work anywhere. For example, you don’t have to be next to certain natural resources or big cities, but can grow having the right people, a good computer, broadband capability. One of the best examples is Dealer.com, but others are growing based on this software capability.”

Looking at some of the newer companies in the last decade (big ones such as Dealer.com and MyWebGrocer), companies like Physicians Computer Co. (PCC), and smaller operations, says Couture, all of them are based around providing software, networking, and computer-based activity that coincides with some of the other technology manufacturers.

“There may be an opportunity to catch another IBM or Husky or Digital or GE, but I think it’s more apt to be the smaller, home-grown software developer or unique application company.”

Expanding base

“We certainly have some great leaders,” Couture says. “The bio tech sector has started to grow, as has the whole energy area, whether Draker Labs or Renewable NRG Systems. Those are different fields and focuses. But the tech companies are growing out of the roots we had about 30 years ago.”

It’s a growth opportunity for the state,” he says. “Our history is rooted in technology leadership: The first patent was given to a Vermonter. We have a lot of technical innovation here, then tourism, foodie marketing — those are solid areas. But we’re saying in addition to that is blending the technology opportunity in with the whole concept of what it’s like to be a Vermonter, and combining the living landscape with the downtown urban interest.”

One of Vermont’s urban advantages is incubator or accelerator spaces, he says, which are cropping up in downtown buildings and stores and in so-called “maker spaces” such as the Generator, a members-driven space that provides equipment such as laser cutters and 3D printers plus studios and classes, and The Benefactory, launched in May by Brandthropology, where Laboratory B and Vermont Technology Alliance reside.

“We can develop a whole technical foundation across Vermont, not just in Burlington,” says Couture, “although it’s the biggest center. But we can create other opportunities in other downtown areas. We try to connect as many of those individuals as we can and give them the opportunity to locate in Vermont and work here.”

No matter where you start a business, good broadband is key, and statewide broadband is an urgent goal so people can do this work from anywhere.

“The limitations historically that might have made Vermont more expensive for other businesses to do business are less that for technology. We always had to work on the state as an attractor. People may know about an IBM in Vermont because it’s big, but they may not know about the other growing and technological companies, not always in high rises, but here, some doing business outside of the state, developing solutions for companies and customers worldwide.”

The work ahead

Couture poses questions, the answers to which will open more doors to these kinds of operations. “How can we connect with these employees, maybe some of them out of state, who want to get out of traditional tech areas and live the Vermont lifestyle? How can we help, say, students who might think they need to leave, to provide opportunities so they can stay in Vermont?

“How can we build on this sort of growing of technology companies and entrepreneurism? How can we encourage others — the spinoffs, the startups that one day will become the future MyWebGrocers or Dealer.coms, or if not that big, become a 25- or 50-employee company, which, by Vermont standards, is pretty big? •