CRG Leverages Staffing Strengths
S hared cultural values—strong work ethic, great company culture, and unsurpassed service for clients—are what propelled the union of three regional staffing firms to expand CRG, a staffing and consulting firm with more than 20 years’ experience in the Triad, Triangle and Charlotte markets.
The firm has leveraged its distinctive strengths, recently completing a branding overhaul, and is poised for expansion across the Southeast with a model that gives top talent a stake in their office’s market success.
Jason Heller, a veteran of the staffing industry since 1998 and presently CRG vice president of mergers and acquisition and sales, is credited with corralling the talents of Edmund Walker of W2 Financial, Christiaan Militello and Dianne Gold of Professional Computer Resources (PCR), and Tim Sessoms of ComputerNet Resource Group in High Point, to form a powerhouse staffing firm.
“The idea was to put together a group of companies as a rollup, allowing for greenfield opportunities as well as dynamic growth, as well as being able to do acquisitions,” describes Sessoms, who had turned down earlier overtures to join the initiative until they gathered at Heller’s kitchen table in Cornelius one morning in November 2013.
“I went there, we talked about it, I met the other people and realized it was a quality group of people that looked at this industry and this business much the same way I did,” continues Sessoms. “I felt like all of them were folks of good character. I got excited about the concept: I looked around the table and thought this could be a great combination.”
Sessoms remains CEO of CRG, Heller is senior vice president of mergers, acquisitions and sales, Walker is vice president of temporary operations, Militello is vice president of IT search, and Dianne Gold, is director of human resources.
The partners spent last year merging their staffs, policies, procedures, and software. This year, with the integration complete, the company has added 19 new clients, for a total of 46 and expects to reach $26 million in revenue, including $20 million in IT alone, along with a stable of over 300 consultants.
“Our candidate databases and CRM’s were combined and we now have access to over 100,000 candidates with 90 percent of them within 50 miles of either office,” touts Sessoms. “That along with keeping 95 percent of the customers since the merger has put CRG on a trajectory of double digit growth.”
In addition to IT, CRG focuses on accounting and finance as well as human resources administration, including executive searches for global directors, CIOs, CFOs, and controllers. It keeps a diverse portfolio rather than relying on the large banking industry in the area.
“Ideally we’re looking for the producer who’s tired of working for the large national firm,” Heller says, explaining that the arrangement combines the most desirable qualities of entrepreneurship and big-company affiliation. “They can join our company and grow to the next level. That’s how we envision growing this company.”
Heller says CRG aims to reach $30 million next year and $50 million in five years. The combined firm has both a Charlotte office and High Point office covering the Charlotte, Triad and Triangle markets, and plans to expand to Raleigh, followed by Washington, D.C., Tampa, and Atlanta as early as 2017.
Leading an Evolving Industry
The staffing industry, both permanent placements and temporary contracts, has evolved significantly in recent years, with jobs reaching to high-paying levels.
“When you say ‘temporary,’ most people think of that entry-level admin, somebody on a ladder in a warehouse,” says Heller. “Temporary includes a hundred-dollar-an-hour IT professional or accounting professional. We’ve got people out in the field at over $200 an hour.”
Workers recognize that drastic economic changes have ended their parents’ and grandparents’ expectations of career-long stability at one company, ending with a gold watch and pension.
“In corporate America, there is no more security,” Heller says. “People know they don’t work anywhere for 20 years any longer. You don’t want a temporary job? Every job is temporary. What you’re finding now is people saying, ‘I don’t want a permanent job.’ They love working on an assignment for six months, then getting to go do another one. The whole dynamic has shifted. Companies have started to see it as well.”
“CRG enables such a career by providing a generous benefits package for not only their internal employees but also all their contract employees, with access for everyone including $12-an-hour workers, we offer full medical, dental, disability and 401K options for all their employees and consultants.” Gold says.
“We make money by treating our people like gold,” Sessoms says. “We want to make sure we are different. I fully understand the bad reputation our industry gets. What you hear from candidates is, ‘They just want to get my butt in a seat and get billing.’ The culture I want to have is, ‘Treat them the way you want to be treated.’”
On the permanent-placement side, the firm differentiates itself by finding candidates through networking rather than on job boards. “I’ve been in this market for 20 years,” Heller says. “I’m not going to go to the job board to find your next candidate. I’ll call CFOs to see who is looking and find a referral candidate.”
“We have a referral bonus plan that is second to none, with referral fees ranging from $250 to $2,500 by just providing a name and contact information,” Militello contributes. “This type of plan helps us grow organically and build a solid foundation for our future growth and turn candidates into long-term clients.”
The mix of permanent and contract placements safeguards CRG from economic swings.
“When the economy is good, they’ll hire more permanent, so our permanent business will go up,” Heller explains. “When the economy gets soft, they’ll bring on temporaries because they have to get the work done. If you structure your business correctly, you can make money in both markets.”
These days, the pendulum that had swung far toward temporaries during the recession is at an equilibrium on its way to a tighter market.
“As we came through 2010 and 2011, the abundance of candidates was great because of the economy,” Heller continues. “Right now, I think it’s ideal. It’s been almost perfect for the last year. I think what we’re going to see going into 2016 through 2017 is a tight talent market. When times were tough, even people who didn’t like their job wouldn’t leave their job. Things kind of go stagnant.
“I remember telling my clients: I promise you, when this economy starts turning for the positive, you need to pick out which employees you want to keep. Most people want to change. They think a change will help them. You’d better identify the employees you want to keep and you’d better go love on them before it gets too good.”
The Synergies of CRG
“People First” is No. 1 on CRG’s list of values, as it is core to the combination of the firms itself. The component firms had worked alongside each other, respecting each other’s work and ethics.
Sessoms started CRG with a partner in 1994, after a friend in the business told him that he thought Sessoms was perfect for the work. “He called and said, ‘I do a job every day that you were born to do,’” recalls Sessoms, who quit his job with Gov. Jim Martin and joined a staffing service. “And I’ve never looked back.”
Sessoms, who worked in his father’s plumbing and heating company from childhood, aimed to apply the family firm’s values to his company.
“I do have a very strong work ethic,” he says, “and I appreciate a good team of people. Together, we wanted to make CRG the fairest place you could ever come to work.”
Heller, who had spent seven years as a securities broker, moved in 1998 to the staffing industry, “I started like a lot of people in a sales role and recruiting role for a large national firm,” says Heller, who quickly rose to manager in the Washington, D.C. area and was eventually transferred to Charlotte.
Heller ended up starting his own search firm with a partner, which they successfully grew and sold to a national firm. In 2013, Heller and his partner were talking about starting a new staffing company with a different approach.
“Instead of starting it from scratch, we wanted to raise private funds, then look for private equity to bring together a couple of different staffing firms,” he says, “with a goal of starting as a $10 million to $15 million company.”
That’s when Heller approached Sessoms, whose 19-year-old $15 million ComputerNet Resource Group, specializing in information technology, had long-established enterprise relationships.
Heller also talked to a former competitor, Edmund Walker, who started W2 Financial with Dann Wall in 2002, and Christiaan Militello and Dianne Gold, owners of 18-year-old PCR, an IT staffing firm.
“The principals of the companies knew each other and had competed against each other in some form or fashion,” Heller explains. “I wanted to beat W2 when I competed against them, but I respected them. I knew them and knew they were good guys; we had always stayed in touch with each other. We wanted to work together.”
At first Sessoms wasn’t interested, but eventually Heller convinced him to come to a meeting that was the beginning of molding these great companies together. As a matter of fact, it was Sessoms who suggested using CRG as the foundation for the combined entity, rather than seeking private money.
“The whole thing changed at that point,” Heller recalls. Sessoms remained CEO of the combined entities and the new CRG was born.
“As far as making this thing actually happen, that’s Tim,” Heller says forthrightly.
With his extensive background in combining companies, Heller was put in charge of synthesizing the partners’ firms as well as merger and acquisition work.
“The hardest part has been integrating the owners,” Heller quips. “We’re all used to doing things our own way. But seriously, we’re basically integrating three brands to have the same CRM, procedures and policies. You’ve got to keep your front office driving the business while the back office integrates people and practices from three companies.
Even as the details were ironed out, the total value of the company’s Charlotte operations grew from $7 million to $10 million by the end of 2014, with a total of $24 million counting the Triad/ Triangle operation.
“I look back, and I’m so blessed it happened,” Heller says. “The No. 1 word I can tell you is ‘humility.’ I said, ‘We’ll make this successful if we can stuff our egos in our pockets.’ The owners had to swallow their pride and say, ‘I know this is how I used to do it, but what’s the best way to do it together?’”
The firm leverages its location and long experience in Charlotte to maintain a healthy, diversified client base.
“Everyone thinks about Charlotte as being the banking capital—which it is—but we’re able to grow and drive a business without doing any banking because of where it’s located—the airport and Fortune 500 headquarters here,” Walker comments. “Candidates from all over the country want to come here. It’s such a desirable place to be for all ages.
“This is a great market for our business. It is much easier to recruit to North Carolina than to a lot of other places. Whether you call an IT professional, an HR director, a CPA or an MBA—working in Detroit, Buffalo or Columbus—and ask if they want to come work in North Carolina, the answer is always, “Yes!”
There is no doubt CRG is well-positioned for unprecedented long-term growth with just the right combination of owners, management and key employees in place
CRG Workforce, Inc. dba
9335 Harris Corners Pkwy., Ste. 250
Charlotte, N.C. 28269
Principals: Tim Sessoms, President and CEO; Jason Heller, Sr. V.P. Mergers & Acquisitions and Sales; Edmund Walker, V.P. Temporary Operations; Christiaan Militello, V.P. IT ConsultingDianne Gold, Director of HR
Offices: Headquartered in Greensboro/High Point, N.C.; Charlotte office
Employees: More than 300
In Business: Founded 1994
Business: Recruiting and consulting services company focused in the areas of information technology, accounting and finance, human resources and administration and search.
Building Your Beverage
BYB Brands Creates and Sells Brands People Want!
Norman George sat among his Coca-Cola Bottling Co. Consolidated peers antsy—ready for a change. He’d been with the company for several decades. He loved the complexities of the beverage industry; that every day brought a new challenge and new reward. He also appreciated the Christian-based leadership of J. Frank Harrison III, chairman and CEO of the Charlotte-based company.
But, his entrepreneurial spirit needed to be fed in a new way. So, he decided to toss an idea to the board.
“At the time, I was wondering how unknown beverage ideas bring their flavors to life,” George remembers, leaning back in his chair. “For me, Coke would always be at the top of the list. But, I knew that people’s tastes were expanding, and I thought the company had an opportunity to expand with them.”
With the agreement of the board, George began the process of creating BYB Brands as a division within the company dedicated to brand creation for new beverages with George as general manager.
“I wasn’t aiming for the role, but I guess he who has the idea has to make it happen, right?” he chuckles, recalling the swift transition in his career.
In the last 10 years, George and the BYB Team have launched two major beverage lines and elevated the company to new ownership and a wider distribution base.
Building a Brand
The first brand created by BYB was Cinnabon Lattes. George, with his creative passion for business, saw an opportunity in beverages that started as niche.
Bottled coffee was a new concept and popular with a wide demographic, so BYB cut a license deal with Focus Brands, Cinnabon’s parent company, to build the sweet and decadent flavor of the world-famous Cinnabon rolls into a premium ready-to-drink coffee.
Cinnabon Lattes were in the marketplace for about a year and a half while bottled lattes were all the rage; however, this brand could not gain national consumer traction and the BYB team decided to retire the product and move on.
“The beverage industry is tough,” George affirms, shaking his head. “I’ve been in it more than 30 years and I continue to marvel at what works and what does not.”
Over the years, George’s team built and launched a multitude of beverages including Country Breeze and Bazza Teas, Bean and Body coffee, Fuel in a Bottle, and Tum-E Yummies. Of these, only Tum-E Yummies remains in the marketplace.
In fact, Tum-E Yummies is growing in reach. The low-sugar, fruit-flavored beverage is No. 1 in retail dollar sales in the convenience retail channel across the U.S. (AC Nielsen) in the Juice Drink Category and now expanding into grocery stores.
Tum-E Yummies hit the market in February 2006. George and his team saw an opportunity in low-calorie beverages for children. With a marketing plan targeted specifically to parents and caretakers who want to treat their children with a low-sugar drink, his team began formulating Tum-E Yummies.
Tum-E Yummies is a line of great-tasting, non-carbonated, fruit-flavored water drinks. They are loaded with 100 percent daily value vitamins B6, B12 and C. Each bottle has 50 calories, 13 grams of sugar, and no sodium. Tum-E Yummies are packaged in a 10.1 oz. bottle with a sport cap and are available in five flavors (Very Berry Blue, Orange-arific, Fruitabulous Punch, Greentastic Apple, and Sour-sational Raspberry).
Within in three years, Tum-E Yummies grew into 85 percent of the Coca-Cola Bottling direct store delivery markets. In 2009, when many were having challenges, BYB’s Tum-E Yummies was succeeding. Tum-E Yummies is now in more than 100,000 retail outlets across the U.S.
“Tum-E Yummies was cash-positive after three years and has been every year since,” George remarks. He hails his hard-working team for the success; many were selling Tum-E Yummies out of personal vehicles, in parking lots, basically anywhere and everything to build a product in which they believed.
The brand has also launched a multi-pack line extension sweetened with a blend of real sugar and stevia. The additional blend features the same vitamin-packed ingredients as the company’s original product, while being responsive to the growing demand for alternative sweeteners.
Beverages That Succeed
George’s pride in his team has helped them reach the shared destination that completes the vision of BYB. The company’s destination is to “Be leaders and win in the marketplace.”
Creating a beverage that succeeds in the marketplace takes a balance of art and science. Choosing different drinks, flavors and ideas requires a variety of tactics: evaluating categories and consumer needs not being met or with few choices in the space, attending beverage entrepreneurial shows to see emerging products, and entertaining very small beverage upstarts interested in investments or purchasing from BYB.
Once a beverage is in the BYB wheelhouse, the company begins to study its competitive landscape. They need to understand the targeted consumer base for the product and the growth potential in the marketplace.
The beverages are then packaged and branded for testing in consumer focus groups throughout the country. BYB tests things like the concept and packaging first, i.e., no brand name is attached to a beverage when it hits the senses of the consumer focus group. The idea is to gather as much information as possible regarding the consumer’s willingness to purchase it before branding it.
However, George knows that testing, research and data analysis can only get a beverage so far in this highly competitive industry.
“The best potential product in the world will not overcome picking the wrong distribution partner,” he explains. “Not all products are suitable for the big brand beverage companies. Some are better served through more nurturing routes that will allow them to build to scale. It’s for that reason that BYB exists.”
George points out that building the next billion-dollar brand takes more than tenacity. “It takes an understanding of the industry, the courage to take risks, the grace to accept failures, and a leadership ability that embraces success while exuding humility,” a talent that he comments is almost lost in the business world today.
BYB Brands will continue to move down the path of trying to answer consumer need states that haven’t been met yet, George says.
“We’re innovators, and we’ve got to think differently,” he says. “We’ve got a different mission that has a different feel to ensure that we’re quick, nimble and easy to do business with. We’ve got to be quick to respond.”
Creating a Culture
George admits the first 18 months were tough. Through the brands launched and many more ideas considered, he discovered success has a short memory. He’s learned from mistakes made, but has not dwelt on them. And, he’s surrounded himself with a strong team.
He says his folks hustled for their success because they believed in the brands they were creating. But even more than belief in the brands, they believed in the culture being modeled by the leadership team.
George readily acknowledges he knows who he is and what kind of people he wants to lead. He emphatically states, “I have passion every day I get up. I enjoy the industry and its complexities. If you have a good product and good people who believe in the product, you will do great.”
“Hiring is the most important decision you will make,” he declares. His hiring process has always been a team activity from the very beginning.
The process centers around the mission of BYB Brands: To create and sell brands people want! It then leads into values which include: innovation, passion, undying optimism, and respect. During interviews, candidates are asked situational questions in an effort to glean how they have responded to similar situations in prior work and life experiences.
Through the interviewing process, George and his team begin to assess how a candidate will respond to another core part of the BYB culture: The “Gotta Do’s.” Upon talking about the “Gotta Do’s” George presents a freshly laminated document listing them to demonstrate how serious he is about these 14 actions that each person on his team has “gotta be willing to do.”
The actions include: Always do the right thing; be flexible and fast; take action; live within our means; have fun and demonstrate a sense of humor.
George says that to succeed, potential team members have to have muscle and experience. They have to be willing to share experiences in the field—be book smart and street savvy. George also stresses the importance of surrounding one’s self with different people who have different experiences from different walks of life.
Team members have bought into George’s vision and “Gotta Do’s” readily. What started with George and his idea has grown to 40 full-time team members stretching from San Diego to Charlotte to Boston.
George emphatically attributes their success and growth to the culture. “People look at your feet, not at your mouth,” he says repeatedly. “Culture is a huge part of who we are. I’m so proud of our folks.”
BYB Brands success isn’t limited to the brands it has built. It recently was acquired by The Coca-Cola Company in a stock purchase, becoming the newest addition to the Venturing and Emerging Brands (VEB) business unit. BYB Brands now finds itself in unit with such illustrious brands as Honest Tea, Hubert’s Lemonade, Hansen’s Natural Soda, and ZICO Coconut Water.
Coke’s VEB unit was created in 2007 to identify and build the next generation of billion-dollar brands in North America. VEB breaks down the players in the beverage market into one of five phases of development based on company revenues: Experimentation (less than $10 million), Proof of Concept (between $10 million and $50 million), Pain of Growth (between $50 million and $150 million), Scale to Win (between $150 million and $350 million), and Mainstream (billion-dollar brands).
Rather than waiting until a company breaks into the mainstream to consider an investment or acquisition, VEB identifies interesting companies earlier along the growth curve. Specifically, VEB targets companies that have reached the Proof of Concept phase, since they have already beaten the odds and established themselves in the marketplace.
VEB’s strategy is to take a minority interest in the company first and, then, if the company continues to be successful, The Coca-Cola Company might acquire 100 percent of the business.
Only 3 percent of all beverage brands reach VEB’s Proof of Concept phase, and George and his team can take the credit for boosting BYB’s Tum-E Yummies into the inner circle.
“We’re very excited about our new owners, and equally grateful for the incredible support of the Consolidated board,” George says, with more than a little pride.
Being part of the larger entity will extend BYB Brands Tum-E Yummies’ reach into grocery stores. It’s currently No. 1 in consumer sales in the youth drink category in the convenience retail category. George believes this top rating, along with the nurturing environment with VEB, will bring strong standings in grocery stores as well.
With change in ownership comes a new opportunities for BYB, too. In September 2015, the BYB teams began helping support Peace Tea. Bottled teas are the top product for the late teen to early 30s demographic and second overall for most-consumed non-alcoholic beverages.
Peace Tea is marketed as the connector of people, places and things which inspire, encourage and promote peace. It comes in six flavors and is only 50 calories per serving, with no high fructose corn syrup and no artificial colors.
George knows working on Peace Tea is an exciting moment for his team. It allows them to leverage previous learnings to lead to more success.
George says he is looking forward to continuing the integration with Coca-Cola North America’s Venturing and Emerging Brands business unit, and to support new opportunities while experiencing compounded growth for the Tum-E Yummies and Peace Tea brands.
George enjoys building…building brands…building divisions…building cultures. It’s likely, within the next decade, he’ll build the next billion-dollar beverage. It’s also likely he’ll give all the credit to his BYB teammates as he sits back in his chair and enjoys a cool beverage of his own design.
But then, maybe, he’ll throw back an ice-cold Coca-Cola in celebration of the brand’s 100th anniversary of its patented “hobbleskirt” bottle.
BYB Brands, Inc.
(Part of Venturing and Emerging Brands of Coca-Cola North America)
2101 Rexford Rd., Ste. 236E
Charlotte, N.C. 28221
Principals: Norman C. George, General Manager; Erin Kelly, V.P. Marketing; Michael Rigtrup, V.P. U.S. West Region; Kyle Thomas, V.P. U.S. Central Region; Brad Keinsley, V.P. U.S. East Region; Gerry Vetter, Director of Supply Chain/Procurement
In Business: 10 years (purchased August 2015; created by previous owner Coca-Cola Bottling Co. Consolidated)
Current Brands: Tum-E Yummies; also supports Peace Tea
Business: Incubation unit, founded by Coca-Cola Bottling Company Consolidated, is now part of Coca-Cola North America’s Venturing and Emerging Brands (VEB) business unit, for brand creation.
MANA Nutrition is Saving Lives With a Simple Formula
This dense mixture of peanut butter paste, vitamins, milk, oil, and sugar comes in a small squeezable packet about the size of an iPhone. Administered three times per day for six weeks, it can rescue a young child from the nutritional cliff which is poised to take his or her life.
Called RUTF, ready-to-use therapeutic food, this is the product that Charlotte-based MANA Nutritive Aid Products, Inc. manufactures and distributes under the leadership of founder and CEO Mark Moore. The company’s headquarters is appropriately located in a former grist mill that helped to feed people for over 150 years.
The MANA product is used to treat severe acute malnutrition (SAM) and has been proven effective in saving millions of lives around the world.
Severe Acute Malnutrition
SAM is defined as a weight-for-height measurement of 70 percent or less below the median, by visible severe wasting, or by the presence of nutritional oedema. An estimated 20 million children currently suffer from severe acute malnutrition. Most are in south Asia and Sub-Saharan Africa.
Approximately one million children die each year as a result of SAM, which can be a direct cause of death or can compromise a child’s immune system, leading to other fatal diseases. Malnutrition accounts for 35 percent of deaths among children under five years of age.
MANA was founded in 2009. The name stands for Mother-Administered Nutritive Aid and is a reflection of the company’s dedicated belief that moms are the best and most trustworthy allies in fighting malnutrition.
Prior to the use of RUTFs, the protocol for treating SAM was to get the child to a health care facility, a process that was severely limited by logistics. Many countries don’t have a set of national health policies or a health infrastructure in place to treat severe malnutrition.
If a mother is able to bring their child to a hospital, she is more than likely leaving other young children behind in similar condition. With RUTFs, mothers can directly feed their children.
“RUTF is like peanut butter on steroids. It’s an amazing product.” exclaims Moore. Approximately 94 percent of the children who are treated with RUTF are successfully pulled back from the nutritional cliff.
“It’s for kids beyond hunger; they’ve ceased to be hungry due to nutritional deficiency,” says Moore. “When you cease to be hungry—physically, mentally, spiritually—you are dying.”
A child dies every 10 seconds—more than malaria, AIDS, TB combined times three—according to Moore. “SAM is a huge killer of children, dying for no reason…dying simply because they don’t have a little peanut butter and powdered milk.”
Many factors can contribute to children facing the nutritional cliff such as drought, bad government, war, and parents losing a job. “In Sudan, most children born today will be born on a nutritional cliff—born hungry to hungry moms, living hungry, and, in too many cases, dying hungry,” says Moore.
RUTFs can be used starting with children as young as six months old. While breast feeding is always preferable, in many cases mothers are unable to produce and provide breast milk. In order to determines who needs RUTF, Children are assessed using a special band that measures the upper arm
“Sometimes they are just measuring the bone,” laments Moore. Six months to two-to-three years is a window of opportunity for good nutrition. The RUTF treatment comes as part of a six week program of community management of acute malnutrition education and counseling, or CMAM. RUTF is a key element to treatment as it helps prevent a return to the nutritional cliff.
MANA is basically a peanut butter product. Organizations such as Doctors Without Borders already had a powdered milk formula.
“The problem with that,” explains Moore,” is that it has to be reconstituted. In many cases, there is a lack of clean water to mix it with and dirty, polluted water may kill the child.”
Additionally, Moore says, mixing such small and precise amounts of powdered milk is often challenging for mothers.
“When the stomach of the kid is the size of a ping pong ball,” Moore acknowledges, “small mistakes can throw the treatment way off.” Also, there are no refrigerators so storage and spoilage are serious problems.
“The formula is effective treatment for a child in a medical facility,” comments Moore, “but isn’t scalable to help the many in need. To solve the problem, the milk formula is stabilized, without water, in the peanut butter.
“Kids can tear the end off the package and squeeze the formula into their mouths. They can feed themselves. It’s sanitary.”
Moore refers to himself and members of his staff as The MANA Village, a community that just happens to be a company. “We imagine the MANA Village to be a forum for other businesses, trade associations, or non-profits to join forces to save children from severe acute malnutrition,” he says.
“The revenue we generate in excess of expenses is re-invested in things like new equipment and additional personnel, which allow us to produce more MANA and save the lives of more children. We not only make a special fortified peanut butter, we also seek to play a wider role to spread awareness of SAM and the 20 million children it affects each year.”
Moore’s knowledge of this crisis runs deeps. He has experience working on the ground in Africa as a rural development worker and also working on Africa-related issues as the Africa Specialist (deleted and added) in the US Senate and other NGO’s in the Washington DC area. In addition, Moore co-founded Kibo Group, which is a development organization that includes many Africa projects.
From the Farm Abroad
MANA manufactures its RUTF in a 35,000-square-foot facility in Fitzgerald, Ga., in the heart of peanut country.
“There was already a big peanut processing culture and facility there,” says Moore, who became acquainted with the company called Golden Boy Foods that makes peanut butter under private labels.
“We told them we wanted to buy bulk and we built our factory right across the street. They take peanuts, roast them, grind them and turn them into peanut paste. They send it across the street where we add other ingredients and package it with nitrogen flushing for a long shelf life.
“The MANA factory currently employs 55 local Georgia workers and turns out more than 32,000 packets per hour, enough to feed 11,000 starving children per day. In all, we’ve made 150 million packets since we started, and we’ve treated 1.4 million children with our product,” touts Moore.
MANA has two primary clients: the United Nations (UNICEF) and the U. S. government (USAID).
“We’re part of the supply chain. Tenders come out from these two clients and we seek to be the company that fills those orders.” There are three other companies in the U. S. that make RUTF. The U.S. government is one of the biggest funders of the product.
“UNICEF and USAID have wide distribution networks and established reputations in our target countries to make sure that MANA ends up in the right hands,” describes Moore. “They partner with local governments or non-governmental organizations working on the ground.”
MANA has shipped RUTF to 35 countries, including Kenya, Sudan, Rwanda, Burundi, Chad, Sierra Leone, Burkina Faso, Ethiopia, Nigeria, Syria, Pakistan, North Korea, and Guatemala, to name a few.
The need for RUTF is enormous, but the marketplace has its limits. “As a business, we have very little power in the market; we tend to just respond to it,” says Moore, explaining that the U. S. and UNICEF budgets together are capped at about $160 million. “But it’s a billion dollar problem.
“No business wants to have just one or two customers,” explains Moore. “If UNICEF couldn’t buy our product for some reason, it would be bad for us right now,…and more importantly bad for kids. We’re trying to plan ahead for the future and hedge against changes that might adversely affect both our business and the kids we serve such as changes from an election that might cut budgets.”
Through the establishment of a new non profit organization in 2014, Moore’s team has developed a way to generate more funds for MANA and pump out more RUTF. It’s known as Calorie Cloud (www.caloriecloud.org) and it trades on the enormous fitness and weight loss market in America—a $100 billion industry—to generate money for starving children.
MANA works with American corporations to provide incentives for a more fit and healthy labor force which, in turn, reduces insurance and health care costs. Corporations happily share in their savings by using a small percentage of those saving to produce RUTF.
“The whole world is in a battle with a dysfunctional relationship with food. In the U.S. that manifests in obesity,” says Moore. “We thought, ‘What if we could go to these people and ask them to give us their extra calories, and then we turn around and give those calories to a hungry child?’ That’s a big deal…a real incentive to losing weight and keeping it off. It’s a win-win-win for hungry children, MANA, and corporations.”
Moore believes the Calorie Cloud concept has huge potential. The Calorie Cloud platform already has one large partner in UNICEF US fund, where they have launched UNICEF Kid Power, billed as the first ever wearable for good platform. Kid Power is an effort to fight childhood obesity and inactivity in the USA and malnutrition in Africa as well.
The bands are in Target Stores and are backed by great partners like Star Wars and Lucas Films. Moore points out, “The Kid Power launch is proof of the wider concept, that people right here in the USA can get active and help others.”
After graduating from Harding University, a small Christian college in Arkansas, Moore lived in eastern Uganda for nine years serving with his wife as missionaries.
“Because my wife is a registered nurse, we tended to see a lot of people needing health care. Malnutrition was not our reason for being in Uganda, but we certainly saw malnourished children. Looking back we saw them every day and many times did not even know it.
Upon returning to the United States, he earned a master’s degree at Georgetown University and then served as a Legislative Fellow and Africa Specialist in the United States Senate. It was there that Moore was exposed to food aid issues and first learned about RUTF.
Moore started MANA with the help of friends Bret Raymond, David Todd Harmon and Brett Biggs. Biggs now serves on the board, Harmon leads the MANA operational team and Raymond championed acceptability studies and other efforts in Rwanda before starting another hunger-related non-profit in Arkansas.
Moore chose Charlotte as the company’s headquarters, relatively close to the Fitzgerald factory. A main consideration was the accessibility to a major airport. Moore now lives in Charlotte with his wife and four children.
In the beginning, raising the money was tough, according to Moore. The Halbert Harmon Foundation provided $1 million. The people of Fitzgerald, Ga., wanted the jobs so they backed the effort by assisting on a $2 million loan. The biggest funder was the Children’s Investment Fund in London, which provided $13 million dollars in loans and grants.
MANA is still growing strong. A new construction project is in the works will expand their Georgia factory from 35,000 to 50,000 square feet. Production there will double within three years time, according to Moore.
MANA won’t solve the problem of world hunger. But it will help a desperate mother feed her starving child. And to that mother, and that child, that means everything.
“I love my job,” says Moore. “It’s an honor to go to work every day and know we are making a difference. Someday, we hope, the scientists and the economists and the politicians will find a comprehensive solution to the problem of world hunger. And we hope that day comes soon. But until then…there’s MANA.”
MANA Nutritive Aid Products, Inc. dba
130 Library Lane
Matthews, N.C. 28105
Principal: Mark Moore, Founder and CEO
Locations: Headquartered in Charlotte; facility in Fitzgerald, Ga.
Employees: 5 in Charlotte; 55 in Fitzgerald, Ga.
Business: Nonprofit manufacturer and distributor of ready-to-use therapeutic food to the global marketplace.
MemoryMemo and LifeLens Imaging:
The Sustained Capture of Memory
A picture may be worth a thousand words, but two techno entrepreneurs in Charlotte want to make them worth a whole lot more. Given the accelerating pace of digital photography and social media, they are about to strike a gold mine. For each, it was merely a matter of solving a problem.
Henry Mummaw was frustrated with having to label photos explaining where they were taken and who was in them. He remembers when he was growing up how much time his mother spent identifying him and his identical twin brother on the backs of photographs.
Greg Robey was frustrated by the sheer number of family photos he had amassed—over 12,000—well above the national average of 3,000 (per adult). And to make matters worse, a lot of those photos were deteriorating from the very chemicals used to create them.
Together, the duo have addressed those issues through the launch of separate, but “related” technology companies—one uses proprietary software to create digital “memos” to photos featuring voice and text, and the other is a proprietary service and technology model for restoring and digitizing photos.
“Henry and I believe that memories matter,” says Robey emphatically. “We have both been blessed with great family memories over the years. We want to protect them, and we believe there are millions of people like us who want to be able to do that. We’ve built some very unique technologies to accomplish that.”
“These are important technologies,” emphasizes Mummaw, “to finally create a methodology by which the entire photographic context—reality and memories—can be digitally preserved in one location.”
Digital Photos with Voice and Text
The pace of digital photography is staggering. More than 11 trillion digital images have been taken in the past 15 years, and the annual pace now exceeds one trillion. Nearly four trillion are on the Internet already, and more than 200,000 are uploaded to Facebook every minute. Constant advances in smart devices and Internet technology are only accelerating the process.
“There are upwards of 10,000 photography apps available on smartphones alone focused on editing images. We wanted to be the first application that focused on ‘the back’ of the photo,” Robey quips.
Together, he and Mummaw have developed MemoryMemo, an app for iPhone, Android and desktop computers, enabling shutterbugs to annotate each snapshot with voice and text. Their proprietary MemoryMemo software automatically collects that information—the universally-recognized “5Ws” of Who, What, When, Where and Why—in a new file extension: .memo.
The Who (the photographer), the When (date and time), and the Where (GPS location), are recorded by the smart devices used to take the photo and are attractively displayed as text in the app and desktop software. The company’s software allows the user to see the 5Ws in the .memo, but more importantly, allows the user to add text and audio to further explain the What and Why.
Users can capture up to 30 seconds of sound, called an MTrack, before and after the shot. Audio comments can also be added later. “This is the first technology to allow you to capture comments made before and after the photo is taken,” says Mummaw.
Being able to add text and actual voice to the photographic memory not only preserves the context, but enhances the meaning for future generations. The photo can actually “speak,” jogging the memories of family and friends, and providing a much more intimate experience.
The user can add information at any time and ask friends to contribute as well. The inventors created a system based on traffic signals that indicates whether the .memo is incomplete (red), in process (yellow), or complete (green). The .memo file includes an image file, text file and a voice commentary audio file. They are archived for free in the company’s cloud, called MCloud where they can be searched by any of the 5Ws.
“We capture all that information and encrypt it into one file that is your property,” Mummaw explains. “You own it. It solves the ownership problem that’s been plaguing photography forever.
“The purpose is to create an easy mechanism by which you can scan and sort through thousands of digital files and find the one you want. When you search a particular date, for example, every photograph you took on that date is found and displayed immediately,” he continues. “Now search engines will be able to create revenue opportunities from digital photos. They will be able to see and read .memo text files. They will know exactly what the photography is about.”
The company’s MWorld is a photography platform where users keep their photos private or share them, including emailing or posting on social media. Eventually users will be able to print their .memos information. By combining text with images in a new unique file extension, MemoryMemo has created a new communications medium.
The technology opens vast creative possibilities for words-and-picture albums that capture the celebration of a wedding ceremony, the hilarity of a child’s birthday party, or even a compiled life story. The company also provides training videos to make such projects easy for users.
“Instead of a high school yearbook photograph with merely a caption,’ Mummaw comments, “imagine one that, in addition to text, has QR codes next to the pictures so that the voice and words of the person could be heard at the same time. Ten years from now, that person’s voice and words will still be there.”
Other people can contribute to the context or memories at any time. For example, Robey’s mother shared old stories of her life and his childhood that he’s added to her images. “It’s amazing what I learned about my mother’s earlier days and my childhood—more than I would ever have known,” he says.
“MemoryMemo is a memory management system,” explains Mummaw, “wherein the photograph is preserved along with its memories to last forever. We want to be a solution that everyone can use and enjoy.”
In addition to the personal and social uses, the MemoryMemo utility technology has a wide range of commercial possibilities for those who use photography in their work.
Preserving Analog Memories Digitally
“For anyone born before 1995, their childhood memories are on analog photographs or slides,” Robey points out. “The chemicals that are used in the production of photos and slides begin to break down from the very beginning. We want to protect the memories on those photos and slides before they, too, begin to fade.”
With LifeLens Imaging, the founders have a process for preserving and enhancing photographs digitally, correcting for color and quality degradation at the same time. Their strategy addresses major barriers to preserving memories—90 percent of people are reluctant to part with their irreplaceable pictures for weeks while they are shipped elsewhere for processing.
LifeLens Imaging transforms paper photographs and slides into enhanced digital images with the latest Kodak Perfect Touch technology, providing unprecedented convenience and economy. Customers simply drop off the originals at their local Walgreen’s store and, at low cost and within a short period of time, their irreplaceable memories are transformed into digital photos—and even restored in the process. Walgreen’s national footprint couldn’t be more convenient, and the photos never leave the community.
LifeLens Imaging uses barcodes to track the pictures and return them to the local store in about a week after pickup. The fast, reliable service costs less while attracting more traffic to partner retailers since the LifeLens uses a proprietary marketing program called Community Partners to produce incremental traffic for their participating retailers.
In addition, LifeLens Imaging permanently archives the images at no cost to their customers to protect them against future loss.
The market for these solutions is enormous. Around the world, some 3.5 trillion analog photographs and slides are awaiting conversion to digital format. Advances in scanner technology in the past five years have enabled enhancements that correct for the effects of aging. The effect can be so dramatic and vibrant that some people replace the original in the frame with the scanned and printed copy.
The founders have completed a pilot launch of LifeLens Imaging with select Walgreen’s locations in Charlotte and plan expansion to surrounding counties and other locations nationwide in 2016. They are partnering with several civic, nonprofit and charitable organizations who earn 15 percent of revenue from their referrals.
They will roll out seven additional processing labs in 2016 that will each serve up to 300 retail stores using a hub-and-spoke system of pickup and delivery. By the end of 2017, they expect to be in all Walgreen’s stores nationwide.
Agreements with some 8,200 Walgreen’s stores, along with other major retailers, will provide access to 70 percent of the retail photo centers in the United States, and the 95 percent of Americans living within five miles of one of these stores.
To serve them, LifeLens Imaging expects first to establish 52 laboratories nationwide, with plans for up to 150. The offices will be about 2,000 square feet with scanning technicians, logistics drivers, and at least one sales manager to work with Community Partners who help attract customers and share in the revenue.
Both Mummaw and Robey share the photographic passion. Both have amassed significant experience that has helped them in their formulation of this new technology.
Mummaw has a 34-year senior management career in professional photography, including a nine-year stint with PCA International, Inc., at the time the nation’s largest portrait photography company serving most nationally known retailers. His extensive photography experience includes a long-standing relationship with Eastman Kodak, now Kodak Alaris, the world’s largest provider of photographic equipment.
Robey held numerous business development, sales and ecommerce positions for FedEx in the U.S. and Europe over a 23-year career. He was also vice president of sales operations for AmeriGas, the nation’s largest propane company for six years.
Together they launched LifeLens Imaging in 2012, and MemoryMemo the following year. Scott McNealy, the cofounder of Sun Microsystems, advises the partners in positioning both the companies for global markets. “Scott believes these are disruptive technologies,” Mummaw comments.
Charlotte connections have been central to the launch, beginning with Thurston Investments LLC, which backed the venture—rare support for a technology startup outside of Silicon Valley.
The patent law firm Trego, Hines & Ladenheim handles intellectual property issues. BGW CPA PLLC handles accounting. CC Communications, Inc. partnered with Mummaw and Robey in technology development and marketing for MemoryMemo. Vintage Marketing, Inc. in Davidson handles the website creative and marketing for LifeLens Imaging.
The complementary businesses reflect the founders’ personal interest in preserving memories by safeguarding and annotating the rich photographic record.
“That’s what we began with—a mission to help people understand that if they don’t do something, their photographic memories are going to be lost. It’s not if; it’s when,” Mummaw says, pointing out that while no one would dispose of those cherished memories, fewer than 5 percent have taken the steps necessary to protect them.
“I was shocked when I looked at my faded family’s photographs,” adds Robey. “Now that I have scanned and enhanced these images, they are preserved and protected forever, and I can share them and their memories through MemoryMemo, social media or email.”
“MemoryMemo is much more than just an application,” Mummaw states, “It’s an integrated platform that combines our MWorld technology and desktop computer software to capture and maintain memories. This memory management system is designed to be easily used by all.
Both MemoryMemo and LifeLens Imaging present the opportunity to collect and preserve family histories, passing memories from one generation to the next. The applications on a commercial basis are without limits, documenting actual facts and circumstances surrounding the photo that was taken and the entire experience.
“LifeLens Imaging helps you preserve and protect your images and MemoryMemo helps you capture and preserve the reasons why you took the photo, or in our case, the 5Ws associated with that memory,” concludes Robey.
“These are solutions to a significant problem—the sustained capture of memory,” says Mummaw. “We want them to be perceived as a solution whose time has come. We want people to identify both solutions as fun and meaningful.”
LifeLens Imaging LLC
9506 Monroe Rd., Ste. AB
Charlotte, N.C. 28270
Principals: Henry H. Mummaw and
William G. “Greg” Robey, Chairmen
Rights: MemoryMemo produces proprietary integration software to capture the entire context of a digital photo—the 5Ws of Who, What, When, Where and Why—incorporating voice and text in a proprietary .memo file through integration technology with Apple and Google Android smartphones; LifeLens Imaging preserves and enhances analog photographs and slides digitally.
When the Olympics were held in Atlanta in 1996, Georgia’s largest port, the Port of Savannah was ranked ninth in a listing of the top 10 U.S. ports, transporting approximately 456,000 TEUs (twenty-foot equivalent units, a common unit of cargo capacity on container ships).
The Port of Charleston transported nearly twice as many at 801,000 TEUs, but both figures were significantly less than the cargo at Los Angeles or Long Beach at 1,873,000 TEUs and 2,357,000 TEUs respectively.
Fast forward to 2014, Savannah’s port has undergone the largest growth spurt of any of the country’s major ports—a 10.2 percent increase—transporting over 3.34 million TEUs, with. Savannah’s Garden City Terminal emerging as the nationís fourth busiest for handling cargo containers used to ship retail goods.
And, according to recently released figures for 2015, there has been a 16.6 percent calendar year-to-date increase in container volumes—the Port of Savannah has moved 2.55 million TEUs since the start of this calendar year, and TEU containers grew by 4.4 percent in August alone. That put the Port of Savannah at 3.7 million TEUs for the fiscal year, a whopping 17 percent growth.
“Those are container volumes we didn’t expect to see until 2019,” Georgia Ports Authority (GPA) Executive Director Curtis J. Foltz says with a smile.
Still at the top of the list of busiest ports are Los Angeles and Long Beach, but they only saw a two percent increase in container volume, with all West Coast ports barely able to register a one percent gain in 2014.
The ports of Savannah and Brunswick contribute $39 billion a year to the Georgia economy, according to the University of Georgia, and 100,000 jobs in metro Atlanta alone are related to the port. The Port of Savannah is the fourth-busiest container port in the country and the second busiest on the East Coast, while the Port of Brunswick is the No. 1 port in the country for automobile imports.
Foltz is proud of the records set by the GPA last year in terms of volume and traffic moved through the ports, but he’s quick to point out that the numbers don’t really tell the story of the impact of Georgia ports on the state and the region.
“Whenever we announce a new record in container volume or number of autos moved through the ports, that means that we’re adding jobs to the Georgia economy,” he says. “Everything we do is about bringing more business and jobs to Georgia and the Southeast.”
Supply Chain Network
Interestingly, Savannah’s centuries-old rival, the Port of Charleston in South Carolina, has experienced the growth trend in reverse. In 2000, Charleston, not Savannah, was the fourth largest American container port. Despite inspired leadership and growth, Charleston in 2014 was ranked the nation’s sixth busiest with 1.79 million TEUs.
Foltz’s immediate predecessor, Doug Marchand, the Texan who captained the GPA team from 1995 through 2009, initiated the Port’s startling transformation. Foltz was Marchand’s chief operating officer during Marchand’s last five years. An Oklahoma native and East Carolina University bachelors and masters grad, Foltz took over from Marchand in January 2010.
One of Marchand’s first growth-inducing decisions was to balance Georgia’s meager imports with its abundant exports. Sitting less than a mile from the Port of Savannah, and adjacent to Savannah International Airport, was a ready-made partial solution: a 1,700-acre former wetland property known as Crossroads Business Center.
In Marchand’s first year, Home Depot took over 1,400,000 square feet of space at Crossroads, a decision that helped kick off Savannah’s economic development. The idea was to use the center to deconsolidate imported goods to Home Depot retailers in the U.S.
Over the next six years, the GPA and the Savannah Economic Development Agency (SEDA) encouraged other corporations to develop distribution centers at Crossroads. Among the early adopters were Carson Products, Dollar Tree and Wal-Mart. They were convinced of the value of bringing newly imported goods to distribution centers close to the Georgia port.
Additional logistics-friendly business parks sprouted near the port or in Chatham County. IKEA and Target are housed outside the Crossroad complex at nearby Riverport Business Park, which is owned by the GPA. Other centers are located at the privately-owned NorthPort Industrial Park. The Georgia Department of Labor currently lists over 400 transportation and warehousing establishments in Chatham County.
The GPA estimates there are 225 more port-dependent distribution centers in Georgia outside Chatham County, some hundreds of miles from Savannah and Brunswick, the state’s other deepwater port located 80 miles south of Savannah.
Many of these corporations are known in the trade as Beneficial Cargo Owners (BCOs), a concept Georgia Trend magazine actually attributed to Marchand. BCOs are importers that take care of their own cargo at a port. They don’t rely on freight forwarders to move their cargo inland.
“It’s a one-of-a-kind operation for the Wal-Marts and Home Depots of the world as well as exporters like Black & Decker, Westinghouse and Hanes,” says Foltz.
Today, thanks in part to Georgia’s vast array of distribution centers and the GPA’s retailer-friendly attitude, Savannah boasts a near 50/50 balance of imports and exports. The average for all U.S. ports tips toward the import side, at 61 percent imports and 39 percent exports.
Distribution centers are but one of a dozen reasons for the GPA’s remarkable gains. SEDA President Hugh “Trip” Tollison pinpoints 2004 as a watershed year for Georgia ports. Savannah’s growth, says Tollison, began after ports on the West Coast experienced massive train and truck tie-ups following a sharp, unexpected increase in imports from Asia.
Labor issues, container shortages, inadequate roads and port infrastructure compounded the problem and led to 10-day unloading delays.
“West Coast port congestion had been building for decades,” adds Foltz. “All East Coast ports gained market share as a result. Logistics managers and major retailers decided they needed to diversify their supply chains and they shifted business to alternative gateways.
“The East Coast got its share and Georgia ports happen to be located in the sweet spot of the Southeast. People and businesses are moving to the Southeast. The supply chain has finally matured.”
Georgia’s sweet spot is expected to get even sweeter. In 2007, 61 percent of U.S. imports came to West Coast ports. But by 2014 that percentage slipped to 55 with the East Coast’s portion rising from 39 percent to 45 percent.
“With 70 percent of the U.S. population living in the eastern one-third of the country, it is reasonable to think that more and more commerce will move to that market,” explains Foltz. “With manufacturers moving south and with the advent of Post-Panamax ships, 50 percent West Coast imports and 50 percent East Coast should soon make headlines.”
The GPA is already underway with the Savannah Harbor Expansion Project (SHEP), dredging the Savannah River to 47 feet to accommodate the Super Post-Panamax vessels that will travel through the Panama Canal after the Panama Canal Expansion Project is completed in 2016.
The GPA is also skilled and knowledgeable in moving automobiles in and out the U.S. Their roll on/roll off (RO/RO) terminal at Colonel’s Island at Georgia’s Brunswick port is the second largest automobile processing port in the country after Baltimore. Over 700,000 automobiles come in or out of Brunswick with an 80/20 ratio of imports to exports.
Exported autos include Mercedes-Benz, Daimler, Toyota and General Motors. Brunswick’s imports run the gamut from tiny to turbocharged: Subaru, Audi, Bentley, Saab, Hyundai, Jaguar, Kia, Nissan, Porsche, Rolls Royce, Land Rover and Maserati.
The automobile business has been strong; “We’re basically full,” says Foltz of the Colonel’s Island facility, and notes that the GPA is embarking on a phased expansion to the south with additional acreage, rail and rail terminal.
In addition to deepening the Port of Savannah, the GPA is also concerned with how the facility will handle the hoped-for increase in cargo. The GPA does have a $1.4 billion plan to expand its cargo handling capacity, but, Foltz points out, it still needs to create a better network to attract and manage goods heading to and from the port.
The GPA has devised an ambitious outreach to manufacturers and shippers in Georgia and five neighboring states called Network Georgia, a business development plan for Georgia’s ports.
Network Georgia divides the Southeast into six zones. Each zone is to have at least one inland port. And each inland port is to serve as a regional hub for goods heading to or coming from the Savannah port.
The first inland port created under this scenario was in Cordele in southwest Georgia. The Cordele Inland Port is a privately owned 40-acre rail terminal 175 miles west of Savannah, handling cotton, clay, lumber and other agribusiness exports for customers in Georgia, Alabama and Florida. In addition to rail, Cordele owns a private fleet of tractor trailers for transit between Cordele and Savannah via I-75 or Georgia highways 300 and 280.
A second regional port was recently announced—the Appalachian Regional Port in Chatsworth, to service North Georgia, Alabama, Tennessee and parts of Kentucky.
“By providing a direct link to the Port of Savannah, the Appalachian Regional Port will create and expand international markets for businesses, and further the economic success of the Southeastern U.S.,” Foltz points out.
“This new inland port is located in an industrial belt, which includes the production and export of carpet and flooring, automobiles and tires,” he continues. “The Appalachian Regional Port will make those commodities more competitive in the global market by saving port customers money on inland transit costs. Moving more containers to rail will also reduce carbon emissions.”
“As part of our Network Georgia initiative,” says GPA Board Chairman James Walters, “our goal is to create the largest inland intermodal complex in the eastern third of the U.S., expanding our reach with more economical shipping alternatives for new and existing customers.”
The Appalachian Regional Port will open by 2018 with an annual capacity of 50,000 containers. A 10-year development plan will then double that capacity.
The GPA says it has plans for additional inland ports to be announced. If they follow in the same pattern, they will eventually provide overnight container train services three times a week to the Garden City Terminal or Brunswick. All the freight handled is expected to be international and will extend the reach of Georgia’s ports to areas of Florida, Alabama, Tennessee and both North and South Carolina.
Georgia’s two existing inland ports at Bainbridge and Columbus are small, domestic and rural hubs. It is expected that neither will be included in the Network Georgia initiative.
“We are taking the districts one at a time, and making sure we have good rail and road access in those areas,” Foltz says. “Network Georgia is taking us well beyond the port; it builds a stronger base for commerce for inland locations in the port network.”
Rivaling the Competition
Network Georgia covers a region that takes in all of Georgia as well as portions of Alabama, Florida, North Carolina, South Carolina, and Tennessee. Georgia isn’t unique in fostering a network of inland ports, but some have noticed that it is proceeding in a way that certainly seems “overtly ambitious.”
North Carolina’s State Ports Authority, for example, touts inland ports in Greensboro and Charlotte. According to its website, both of those inland ports are: “Strategically located at the heart of manufacturing and distribution sites in the Southeast.”
Network Georgia dwarfs North Carolina’s distribution network, and most certainly will heat up the competition with ports in those states as Georgia seeks to grow its ports trade.
“It’s part of the larger initiative we are taking in order to take our port connectivity to a new level,” Foltz says.
Regarding the long term future of East Coast ports, GPA’s Curtis Foltz and South Carolina Ports Authority President Jim Newsome agree on the necessity for a new East Coast Intermodal Complex, the Jasper Ocean Terminal (JOT) straddling the two states.
“I firmly believe that it has to be done,” says Foltz. “I think it has to happen. There is not a lot of new port capacity on the East Coast.”
Both Georgia and South Carolina ports will be out of capacity in 10 to 20 years, JOT’s planned start time. JOT’s 1,700 acres technically in South Carolina on the Savannah River will make it the nation’s single largest port. There are many unknowns in developing JOT, but, Foltz adds, “Things that make sense find a way to happen.”
When asked what we in Charlotte can do to enhance the supply chain network between the Queen City and the Hostess City of the South, Foltz was blunt: “Invite me there more often!”
Foltz likes Charlotte. He has lived here five different times—when he graduated from South Mecklenburg High School, and different occasions when he worked for Harris-Teeter, CSX World Terminals and Overnite Transportation.
He challenges Charlotte to support cooperation between the Chamber of Commerce, employers and the various Southeastern ports as well as efforts to build out our rail network.
“Enhancement,” says Foltz, “begins with dialogue.”
Georgia Ports Authority
2 Main Street
Garden City, GA 31408
Principal: Curtis J. Foltz, Executive Director
Ports: Ports of Savannah and Brunswick, Bainbridge and Columbus; Network Georgia initiative ports including Cordele Inland Port and Appalachian Regional Port
Terminals: Garden City, Ocean Terminal, Colonel’s Island, Mayor’s Point
Business: To develop, maintain and operate ocean and inland river ports within Georgia; foster international trade and new industry for state and local communities; promote Georgia’s industrial and natural resources and maintain the natural quality of the environment.
Asked what makes his company stand out, Bill McMahon, president and CEO of CoaLogix Inc. and its subsidiary SCR-Tech LLC responds, “We’re a relatively small company dealing with behemoths like Siemens, Shaw and Babcock & Wilcox. We’re in that crowd because we think a little differently on the entrepreneurial side. And that’s how we’re changing things.”
McMahon’s company is most concerned about energy and engineering innovation, specifically how to economically reduce the environmental footprint of electric, coal-powered utilities.
“Our world is using significant amounts of coal and we have to make it cleaner,” he says bluntly.
“The United States produces over one-third of its electricity from coal and that will be true for the next 10-20 years; it’s one of the least expensive sources. Coal comes from inside the United States and there’s a lot of it. In addition, mine safety technology has allowed for automated mining, leading to fewer accidents and greater access to coal with better efficiency.
“Coal has to be a part of our future,” he continues. “Just to maintain our way of life, we’ve been growing at about 1.6 percent a year for gross domestic product. Our electricity use grows with GDP, so that’s about 6,000 megawatts a year. We need to make sure that the country continues to build power plants of all types to meet this need.”
An increase in coal-powered production means an increased need for pollution control equipment as well, because of the nitrous oxides (NOX) and sulfur dioxide (SO2) released into the air. Fortunately, these pollutants, along with dust, have already been reduced over 65 percent in the U.S. since 1970 despite the increase in power required by a 235 percent increase in GDP, a 54 percent increase in population and a 44 percent increase in electricity consumption.
That’s where CoaLogix’ SCR-Tech’s business comes into play—reducing the environmental footprint of electric, coal-powered utilities. SCR-Tech uses a chemical process to transform bad emissions into largely harmless emissions, reducing the customer’s cost of reduction by as much as 50 percent. The method known as Selective Catalytic Reduction, or SCR, is the principal NOX emission control technology, and CoaLogix has earned a 70 percent market share in regeneration.
Charlotte-based SCR-Tech is changing the way that energy producers manage not only pollution, but also governmental regulations. SCR-Tech regenerates catalysts that are used to reduce pollution produced by coal-fired power plants.
“We are in the holistic application of technology,” describes McMahon. “We focus on coal environmental impact reduction, on how to burn coal logically.”
“To get a little more technical, when combustion occurs in a coal-powered plant, nitrous oxide is formed. It’s a greenhouse gas and, therefore, must be reduced. SCR or selective catalytic reduction is a chemical process that accomplishes that with about 90-95 percent efficiency. SCR does that by turning nitrous oxide into harmless water and nitrogen. The air we breathe is 80 percent nitrogen.”
A catalyst works on a molecular level to transform pollutants. As a plant burns coal to generate power, the exhaust goes through multiple layers of the catalyst material where chemical forces work to remove NOX.
The catalyst material is a ceramic and contains many tiny pores and huge surface area, so much so that each catalyst from one power plant has a surface area that, if stretched out, would make a half-mile wide road around the equator.
Over time, however, the catalyst will become clogged and poisoned with fly ash and other contaminants that reduce its efficiency at removing nitrous oxide from emissions. “In this catalyst are elements like arsenic, vanadium and heavy metals,” McMahon explains. “Our process actually regenerates this catalyst and puts it back into service rather than a landfill.”
These catalysts typically are the size of a compact car and weigh about 3,000 pounds. McMahon shows a photo of spent catalyst from one typical-sized coal-fired plant. It fills a 15,000-square-foot CoaLogix warehouse and the units are stacked near the rafters of its high ceiling.
In an SCR, the massive amounts of catalyst are deactivated over time. Every three years or so, our customers replace the deactivated catalyst with either new or regenerated catalyst which saves 40 to 50 percent.
“The amount of catalyst that would be landfilled annually equals about 50,000 cars per year,” explains McMahon. “To put that into perspective, Panther Stadium and the lots around it would hold about 10,000-20,000 cars on a game day.
“We do that at a fraction of the cost of new catalyst, and the result is cleaner air and cleaner ground.
“By restoring these catalysts to full performance, SCR-Tech can reduce a coal-fired plant’s landfill impact by 75 percent. Further, because it can regenerate a used catalyst for much less than the cost of a new one, utilities save money,” continues McMahon.
“Our customers here and in China have billions of dollars of catalyst in their power plants. About one-third of that has to be replaced every year. There’s a replacement market of hundreds of millions per year, not counting the inspections, catalyst management, tuning and general SCR management we also perform.”
SCR-Tech also buys catalyst and regenerates it. In its west Charlotte warehouse, the firm has about 2,000 megawatts of catalyst, cleaned and ready to customize with the right mix of chemicals for an individual customer.
Employing a range of professionals, including chemical engineers and mechanics, CoaLogix is a 24/7 operation. At the company’s Charlotte headquarters off Westinghouse Blvd., catalysts are shipped in to be regenerated from across the country and to China.
Once there, they are inspected and tested in a lab where the determination can be made as to what the best regeneration process will be. The team gets to work removing the contaminants and some of the active ingredients (chemical engine) from the catalyst and then reapplying a new chemical engine, returning it to like-new condition, testing it for quality and shipping it back out.
A Catalyst for Growth
Born in Manhattan and raised just north of New York City, McMahon earned a bachelor’s in nuclear engineering from Georgia Tech, an MBA from Xavier University, and an advanced management degree from Duke University’s Fuqua School of Business.
Unique technology was a strong draw for McMahon, a nuclear engineer who had run multiple energy-related businesses, when he took the reins of SCR-Tech. “The impact of this technology was just unbelievable,” he recalls. “I knew this was going to be a fun business.”
McMahon explains, “The technology was created in Germany in the late ’90s. SCR-Tech was purchased by Catalytica in 2004 and they brought me on board in 2005. I have a broad background in environmental science,” describes McMahon, “and I knew it was time to regroup. I changed out almost the entire management team and we started focusing on the technology—and sales really started taking off.”
In 2007, McMahon brought Mike Mattes on board who is now president of USA Operations.
When Catalytica merged with another company, the team found there was an opportunity to purchase SCR-Tech. They promptly found private equity backers and they won the bidding in a sale in November 2007.
CoaLogix and SCR-Tech are presently owned by Energy Capital Partners, a private equity firm with over $13 billion in capital commitments. The firm focuses on investing in the power generation, midstream oil and gas, electric transmission, environmental infrastructure and energy services sectors of North America’s energy infrastructure.
SCR-Tech has been awarded the Platts Global Energy Award for Commercial Technology recognizing leadership and innovation (kind of the Academy Awards of the energy industry) a number of times, as well as the NCTA Green Tech Award. CoaLogix beat out hundreds of nominees and finalists, including the China National Offshore Oil Corporation, Lennox Industries and Salt River Project.
In addition, the company has a new designation to tout. It has recently been recognized by the On-site Consultation Program’s Safety and Health Achievement Recognition Program (SHARP) as a small business employer operating an exemplary injury and illness prevention program. Acceptance into SHARP from OSHA is an achievement of status that singles a business out among its peers and exempts the worksite from OSHA programmed inspections during the period of the SHARP certification.
Catalysts for Environmental Stewardship
Friends since 1980, McMahon and Mattes both have a deep commitment to protecting the environment. “You do feel good that you’re doing something for the environment. Ninety percent of my career has been environmental. I always heard people talk about doing something to reduce pollution, but I wanted to actually do something about it,” says Mattes.
“What we do is keep the NOX out of the air,” explains Mattes. McMahon adds, “I think we’re doing something really big for the environment, for the world—that’s important.”
The implementation of catalyst regeneration has a significant positive impact on pollutants. The carbon footprint for regenerating catalyst is much less than manufacturing new catalyst. As a result of this, regenerated catalyst annually removes the same amount of CO2 that would be removed if 100,000 traditional vehicles were replaced with electric vehicles. The regeneration process can also save power plants around $200 million per year.
The desire to clean up the pollution put out by coal-fired power plants lies at the heart of CoaLogix’ business philosophy, but the company is also committed to its customers. As Mattes explains, CoaLogix strives to be a trusted advisor for their customers, making the company more of a service provider.
“Our customers are dealing with very complicated environmental and operational issues. We assist them in evaluating the options that are available and the impact of these options on their 10-year budgets,” says Mattes.
“In most cases, our recommendations include both new and regenerated catalyst. We make a conscious effort to give the customer the advice that we would want if we were in their shoes doing the same thing.”
Sometimes it might cost CoaLogix in the short-term, as McMahon points out an instance where the company recommended that a potential customer purchase a new catalyst instead of regenerating, but ultimately the company came back to CoaLogix to have the new catalyst regenerated.
Mattes notes, “I think increased government regulation coupled with significant economic challenges, is one of biggest challenges our industry is facing. Our goal is to meet our customer’s ever-changing needs. This often means many projects need to be performed on an emergency basis, so we have to be very flexible.
“We do that by having a strong organization and good people, and we have a lot of communication with our customers. We talk to our customers regularly, becoming that trusted advisor, and this, in turn, allows us to earn and keep their business.”
Catalysts for China
When it comes to pollution, China is high atop the list of the world’s greatest opportunities. As a result, the Chinese government has imposed some of the most stringent regulations and environmental standards in the world.
Experiencing this firsthand, McMahon and Mattes decided that serving the Chinese market would be the perfect opportunity to carry out their mission of reducing the environmental footprint of power plants.
“We’re trying to do the same thing in China,” comments McMahon. “China has the tightest nitrous oxide regulations in the world now. They’re at 100 to 50 mg of nitrous oxide/cubic meter. The U.S. is at about 135. The EU and Japan are at 200.
“At the same time, the Chinese market in general is arguably close to 8 times larger than the U.S. It’s grown very fast. It’s too big to ignore.
“We have a much better foothold today in China because we presently have 12 plants running on regenerated catalysts, but the potential is much larger. We also decided to build a plant in China, the next generation from our North Carolina plant, in December of 2014. We built this plant with our joint venture partner Longking, a large, publicly traded environmental company in China. That plant will service 10 percent of the market, so we have our work cut out for us there.”
This partnership has allowed CoaLogix access to new technologies and products that offer greater environmental protection for the 12 Chinese power plants the company currently serves, but it also allows for the potential to bring new technologies to CoaLogix’ U.S. customers.
McMahon concludes, “Between adding products and services here and in China and building in China, we’re always looking out for our customers and for opportunities to create the best value for our customers, employees and investors.”
A CoaLogix Inc. Company
11707 Steele Creek Road
Charlotte, N.C. 28273-3718
Principals: William J. McMahon, President and CEO; Michael F. Mattes, COO and President of USA Operations
Parent Company: CoaLogix, owned by Energy Capital Partners
Employees: 235 globally, 120 in Charlotte
Revenues: Less than $75 million
Locations: Headquartered in Charlotte; plants in Charlotte and near Shanghai, China
Business: Provides selective catalytic reduction services, environmental protection.
While most industries have marched onward with smart computers, smart phones, smart cars, and smart household appliances, electricityóthe very thing that powers all the restóhas been lumbering along in the shadows of its old-fashioned mechanical, thermal magnetic-based distribution system for close to a century now.
“We have analytics and controls over everything else,” exclaims Ryan Kennedy, CEO of Atom Power, LLC. “Electricity got left out. Circuit breakers, through which electricity is distributed, open with a switch and close with a switch—purely mechanical. Their characteristics cannot be altered.”
From early on in his electrical background, Kennedy thought there must be a better way, a safer, more efficient way, to distribute electricity. His company, Atom Power, established in 2014, is now ready to prove this idea and change how the electrical distribution industry operates and how we all receive electrical power.
The Series A funded energy technology company moved in 2015 into new headquarters in the Portal Building on the University of North Carolina at Charlotte campus.
New Circuit Breaker Technology
Atom Power has developed a new circuit breaker technology that utilizes digitally controlled solid-state components built into a product call the Atom Switch. The Atom Switch is a circuit breaker that provides all of the functionality of a traditional circuit breaker but is software driven, allowing operators to dynamically change characteristics.
“Using the Atom OS software platform, we could have one Atom Switch be a 20-amp circuit breaker one day, then simply program it to be an 80-amp circuit breaker on another day, depending upon need and circumstance,” explains Kennedy.
In addition to being able to manipulate the ampacity, the Atom Switch is fast, operating over 100 times faster than mechanical circuit breakers, mitigating short circuit and arc flash hazards. Atom Power has created an end-to-end product, both with the hardware and tightly integrated software.
“For the first time in history, we will allow full digital control of an electrical infrastructure all while making it safer and easier,” says Kennedy.
Every electrical system within any building has an incoming utility service and is protected by a network of circuit breakers which “trip” or interrupt the flow of electricity in the event of a short circuit or power overload. In today’s commercial buildings, multiple branch circuit breakers feed everything from the HVAC system to the lights and receptacles to security.
Circuit breakers have to withstand huge amounts of electrical current and they are very imprecise when they trip. “There are only limited methods by which you can tell anything about them or how much current is flowing through them. The existing systems operate under a big veil of mechanical complexity,” says Kennedy.
Engineering companies are routinely engaged to do complicated, detailed coordination studies to decipher the order in which circuit breakers will trip in case of an overload as well as to determine how much electrical energy will be created in the event of an arc flash event due to a short circuit.
“An inherent cost of engineering a building is in doing coordination studies, which figure out which circuit breakers trip first, which parts to use for large systems, and how big the fireball will be in the event of a short circuit event. Everything you do affects everything downstream,” explains Kennedy.
“These studies are quite expensive for building owners to have done. Now, OSHA has adopted standards for ensuring electrical safety in the workplace (most hazards of which are caused by the slow speed of mechanical circuit breakers), making these studies just short of mandatory.”
Atom Power is lifting the veil of complexity with its software designed to make the function of its solid-state circuit breakers visible. With the software in play, operators can now see all of the circuit breakers and panels in their infrastructure, see how much power is being consumed at the circuit breaker level, change the characteristics of the system, and control remotely (turn breakers off and on).
“It’s been taken for granted for so long that this is just complex; that to know how to actually install a full electrical system, you have to have all these experts, conduct all these studies, analyze all these products, and be told what to buy. Our product is self-aware; it knows where it’s at in the system. It tells you everything about itself,” says Kennedy.
The slow tripping speeds of traditional circuit breakers are also problematic—they can cause short circuits and arc flash hazards. When the circuit breaker is slow to respond to a short circuit, huge amounts of energy are released with risks that include fires, explosions and personal injury.
With thousands of breakers in a system, operators can’t truly know for sure which one will trip first in a fault, which is why they must rely on engineered coordination and arc flash studies, says Kennedy.
“Believe it or not, these problems still have not been solved,” Kennedy continues, shaking his head. “Conversely, an entire industry has been born out of these problems. Lines of protective wear are available for workers who must handle these electrical risks. Insurance companies are now asking building owners what their arc flashing hazards are within their facilities.
“Our Atom Switch trips over 100 times faster than a traditional mechanical circuit breaker,” compares Kennedy. “As soon as we see a short circuit happening, we snuff it out—no delay. It knows to trip itself before the one upstream. Now we don’t have to have such huge amounts of power or design a system to tolerate such huge faults. We are going to eliminate arc flash and short circuit hazards in the industry.”
Sensibility Sparks Ingenuity
In 1994, Kennedy, a Charlotte native, was fresh out of high school and unsure about what he wanted to do. His mother was an architect; his father taught photography. Sparked by the amount of construction underway in uptown, Kennedy decided to become an electrician: “I started out with tools and a hard hat.”
“I didn’t understand why we were doing a lot of things in the trade the way we were doing them,” he recalls. At that time, he says, a lot of emphasis was put on the tradesmen to figure out how to carry out the drawings and intent of the drawings.
As an electrician, Kennedy soon discovered that he wanted to be involved with the engineering behind the systems; to be a person who designs some of it. That desire prompted him, five years later, to return to school and study electrical engineering at the UNC Charlotte, and to become a professional engineer licensed in several states.
He continued to work in industrial and commercial construction in Charlotte, but his thoughts about how electrical power should be distributed never left him entirely. In 2004, while working on a project with solid-state lighting controls using “bricks of silicon,” the question surfaced again: “Why can’t we use transistor-based, solid-state materials to provide and control power to electrical circuits in general, not just lights?”
It seemed the industry was not ready. When Kennedy, the newly graduated engineer, talked with fellow engineers about this idea, most were confounded by the technical challenges and preferred to stick with the old, tried-and-true circuit breakers. Kennedy notes that this was around the time Google was becoming popular and before the Internet of things. So he tabled the idea once more.
“Talking with some colleagues at UNCC, it dawned on me that there had been quite a few advances in the past 10 years, especially around solid-state devices for power applications. It prompted me to revisit the idea,” shares Kennedy.
“Myself and a couple of Ph.D folks got together and discussed the physics behind it, some potential applications and agreed that there is a huge opportunity.”
Atom Power will soon have three products on the market: the Atom Switch (or solid-state circuit breaker), the Atom Panel which will contain switches of deliberately selected ampacities and that will allow operators to see their system at work, and the tightly integrated Atom OS software which allows operators to see, control, and modify their entire electrical distribution system.
Breaking the Circuit
The fact that an entire electrical system can be controlled by three products is huge. “This represents an incredible leapfrog in technology,” touts Kennedy. “Currently, it takes hundreds of different parts in various voltage, amperage, and short circuit capacities to do this job. Now there is one box that I can program from 0 to 100 amps. It’s a truly unified design.”
Atom Power is focused on the facility-side commercial and industrial power distribution markets. “They could be installed in a large high-rise building or something that only requires one panelboard,” says Kennedy. “That’s the beauty—this is an accessible product that will reach all markets.
“There is art to this as well as science. We were able to put more of the right-brain approach to it so that it would be compelling for the customer, so they could see and feel it. We’ve made our products very simple and easy to understand. Now you can walk up to an electrical panel and even someone with no electrical experience can understand what’s going on. We’ve made the user experience one of the highest priorities.”
Kennedy expects that Atom products will be a draw to clients interested in new technology that want something that looks really cool in their building. “Now, electrical panels are ugly and you can’t see anything happening. With these,” he motions to his boxes, “you can see it working—lights light up and you can see how much power is moving through.”
Kennedy, who sits on the board of the Electrical Engineering Department of the UNCC College of Engineering, is joined by two partners in founding Atom Power. Greg Crumpton, founder of Charlotte-based AirTight Mechanical, Inc., an HVAC company that was recently acquired and merged with FaciliTech, under the Service Logic, LLC brand, serves as chief marketing officer.
Denis Kouroussis is the third founder and serves as chief technology officer. Kouroussis holds a Ph.D. in electrical and computer engineering from University of Toronto and was the founder and CEO of Volta Energy. With 10 years of experience in the industry his background spans the world of semiconductors, EDA and power electronics.
Prior to becoming an entrepreneur, Kouroussis had designed and implemented solutions in low power design and developed algorithms for power grid verification with numerous publications in the subject matter. Kouroussis previously held engineering and technical management positions at ATI/AMD, IBM Microelectronics and Apache Design Solutions.
The staff of Atom Power is diversified across engineering disciplines. “We have mechanical, electrical and computer engineers on board,” says Kennedy. “We need an equal share of all of those. There are also many resources here locally that we can use to ramp up.” Kennedy expects to almost double his staff within the coming year.
Kennedy finds Charlotte to be a better place to operate now that it has, itself, become an energy hub. “Charlotte is becoming internationally known for power and energy engineering. This is where you go to learn about energy.”
Asked about the company’s biggest challenge, Kennedy responds simply, “To make it work consistently, safely and to go through UL (United Laboratories) and National Fire Protection Association testing—it’s never been done before.”
Atom Power is not in this for money or fame or notoriety, according to Kennedy, but he does want the company to be a household name.
“We’re trying to fix something that is broken; change the industry. It is a slow process but in a $40 billion industry, slow is a relative term. I expect it to take about 20 years for our technology to become the standard for power distribution.”
It was September 1990, when a broadcaster from Tokyo announced that Atlanta had been chosen to host Summer Olympic Games. That was the beginning of the cityís transformation to international recognition.
Anchored by Hartsfield Airport and the home base of Delta Airlines along with the corporate strength of the headquarters of Coca Cola and Home Depot, Atlanta and the state of Georgia began preparations for its debut of a world-class event.
COO of the Atlanta Olympic Committee, A.D. Frazier, is quoted as saying, ìI think our image as a destination was fundamentally changed. It was a pivotal turning point for the city.
Frazier and CEO Billy Payne from Augusta National Golf Club directed the efforts to design, build and operate those games. They used Barcelonaís Placa díEspanya city center as a model for Centennial Park. Its development along with private investment added major hotels, condominiums and office structures, and opened the doors to business engagement around the world. “Manufacturers want a place that is great to work in and great to live in and in this state, we’re able to match both of these needs.
“That’s the South Carolina advantage—what we can give to companies is the knowledge that if they come here, they’ll find success. We want companies to know that South Carolina is a business-friendly state.”
The population of Atlanta has grown from about 3.5 million in 1996 to nearly 5.5 million today. According to one report, overall employment in the areas affected by the games rose by 17 percent during and after the events. Over 77,000 full-time jobs were created. From 1991 to 1997, the impact of the Olympic Games was estimated to be more than $5 billion.
Georgia’s Sweet Spot
However, the first 10 years of the next century were not nearly so generous. Atlanta was broadsided by the Great Recession the same as other major cities.
Fortunately, while unemployment was rising in Atlanta, Georgia has had a sweet spot making great gains: The Georgia Ports Authority had been increasingly aggressive in the shipping industry. Between 2000 and 2015, the Port of Savannah has grown to the fourth busiest deep-water port in the nation with throughput volume growing from just under one million containers per year to over 3.8 million.
“The deep-water ports of Savannah and Brunswick have become cornerstones of Georgia’s future success and major factors in creating new jobs and prosperity across the state,” announced Georgia Gov. Nathan Deal. “The wave of economic impact created by our logistics network supports virtually every industry, from manufacturing and agriculture to mining, distribution, technology and transportation.”
Georgia’s Department of Economic Development Commissioner Christopher Carr reflects on the Olympic experience: “There is no doubt that the Olympics solidified Atlanta as an international city. The exposure of Atlanta to individuals and to companies from around the world demonstrated opportunities from a business perspective as well as a quality of life perspective.
“Culturally we grew. We’ve got the third most visited Museum of Art, The High Museum. The Olympics were definitely a catalyst and a boost into the international arena. Atlanta has become a cultural center. Millennials also want to move to Atlanta.
Even though Georgia began 2015 with an unemployment rate of 7.2 percent—the second highest in the nation—it fell to 6.1 percent by mid-year. According to Commissioner Carr, “The volume of projects that we have had, our tourism hitting record numbers, our trade hitting record numbers, and being a booming entertainment center have caused a steep drop. Governor Deal believes that it is the role of government to get out of the way and let the private sector stimulate the economy.”
As in most states, Georgia suffers from an urban/rural conflict of its own in addition to the struggles within the metro Atlanta region. In total, metro Atlanta includes 150 cities across 29 counties. Tax breaks in one county lure companies from adjacent counties. One recent example is the Atlanta Braves move from Atlanta to Cobb County. With 159 counties, the battles are abundant. There is still banter about whether to live ITP or OTP—inside the perimeter of I-285 or outside the perimeter of I-285, a loop traveling almost 64 miles around Atlanta.
Even amidst those struggles, Georgia was named the best state to do business in both 2014 and 2013 by Site Selection magazine largely because of its workforce-training programs and low tax rates. At the same time, Georgia has slashed funding for education by $8.3 billion since 2003 and reduced aid to students attending technical colleges. Smaller county budgets have been weakened from sweeping sales tax reforms that have broadened exemptions for the agricultural industry.
A Tough Competitor
One of Georgia’s major conquests is landing the Mercedes-Benz USA headquarters earlier this year. News reports suggest that the State of Georgia offered $23 million in tax credits and other incentives to attract Mercedes from New Jersey. The combined package included job-tax credits, exemptions, development funds and lower corporate tax rates.
Of that total, $17.3 million are five-year tax credits given by the state in exchange for each new job brought to Georgia, and the corporate tax bill will be reduced by $4,000 per job, every year for up to five years. It is expected that Mercedes will bring in at least 800 jobs; they had about 1,000 in New Jersey. Carr said that Mercedes looked at neighborhoods and schools as well as the business case.
Carr is also proud that Georgia is home to 20 Fortune 500 company headquarters as well as 31 Fortune 1000 headquarters. He goes on to add, “We have 25 consuls general and around 44-45 honorary consuls (number fluctuates). We have a great relationship with our consulate corps. They are part of the fabric of this community. They are a great asset.”
Other successes for Georgia include about 2,100 employees with the NCR Corp. headquarters from Dayton, Ohio; 1,120 employees with Chime Solutions call center, 650 employees with Toyo Tire North America, 550 with Keurig Green Mountain, 500 with Shaw Industries, Pulte Group, Engineered Floors, Athena Health, Verizon Wireless, Greenway Health and Kubota Manufacturing. Most recently, Georgia attracted GeoDigital from Ontario, Canada, and Mizuno USA.
Even with all these successes, it was disappointing to Georgia to lose Swedish automaker Volvo Cars to South Carolina. Volvo selected a site near Charleston for a plant that would employ as many as 4,000 workers. The all-out effort by Georgia was overcome by a package of incentives from South Carolina worth over $200 million for the investment by Volvo of over $500 million.
While stung by the loss of Volvo, the Governor’s chief of staff says that since that decision, other projects have been brought to Georgia totaling more than $800 million and the promise of 3,455 jobs.
An Integrated Growth Strategy
The Georgia Department of Economic Development is the state’s sales and marketing arm, the lead agency for attracting new business investment, encouraging the expansion of existing industry and small businesses, locating new markets for Georgia products, attracting tourists and promoting the state as a destination for the arts, events and location for film, music and digital entertainment projects in addition to planning and mobilizing the resources for economic development.
“Governor Deal is the number one salesman for the state and he is personally involved in everything we do,” says Carr. “To be selected by him to do this job when his number one issue is to bring jobs to this state is a real honor. He calls the plays and we execute.
“What makes Georgia stand out as an ideal location for business activity is our integrated partnership approach to economic development—from state, local, international, educational sectors and beyond, our teamwork collaboration continues to meet the unique needs of companies that locate in our state.
“Our integrated approach to economic development allows our divisions to provide a variety of resources to small towns, big cities and beyond depending on their assets. While the majority of the population resides in metro Atlanta, Georgia’s diverse topography provides different drivers in each community—it could be agriculture (the state’s no. 1 industry), tourism, manufacturing and beyond.
“In addition, we travel internationally to bring business to our state. We have visited Israel, Brazil and most recently, the Georgia Department of Economic Development led a trade mission to Qingdao, Beijing and Shanghai, China in July of this year. The delegation included state of Georgia officials and business leaders who explored business, trade, education, agriculture, and tourism opportunities.
“Georgia had an exceptional year in economic development because of our partnerships with international markets that are thriving and the intelligence and support we receive from 12 international representatives located across the globe. They operate in Brazil, Canada, Chile, China, Columbia, Europe, Israel, Japan, Korea and Mexico.”
“The film industry has also been a point of pride for the governor, the legislature, the mayor of Atlanta,” continues Carr. “It has been a new and exciting evolution to watch the capital investment go from $250 million to a $6 billion. Watching the supporting companies come along—it has been great to watch this mature. Support from local governments and Hartsfield Airport was just great. And, we have a vibrant and growing restaurant scene.”
Agriculture is the number one industry in Georgia with poultry in the north, pecans and peanuts in the center, and soybeans and blueberries to the south. The Hartsfield Airport and the ports move that produce and livestock around the world. Agriculture is managed under a separate Department of Agriculture. However, the two departments work together frequently.
Supply Chain Network
Georgia’s transportation infrastructure is incredibly important to their success. Atlanta is ninth largest city by area, but 18th in terms of congestion. They have recently announced the opening of a new intermodal north of Atlanta to get 50,000 trucks off their roads annually. This intermodal center also helps Georgia reach the interior U.S. markets.
“The Georgia ports also play a major role in the supply chain network,” explains Carr. “When we are talking to prospects and/or site consultants as well as companies who are looking to import and export, they are a fantastic partner and they work closely with our economic development team.
“One of the most critical factors facing companies today is workforce and our workforce division is playing a key role in ensuring we have a talented and prepared workforce for the future. The Governor’s High Demand Career Initiative has been critically important to opening the lines of communication between Georgia businesses, the University System of Georgia and the Technical College System of Georgia.”
When asked about what industries they target for recruiting to Georgia, Carr says, “Automotive, headquarters activity and innovation are at the top of the list, but we also have significant interest in cybersecurity, Help IT, mobility, financial technology and entertainment.
‘Project activity is strong and the pipeline continues to grow with good, quality projects. From California and New Jersey, to Germany and Japan—headquarter relocations, the automotive industry and international investment are leading the way.”
Geographically Georgia boasts being within a two-day truck haul or two-hour flight of 80 percent of the U.S. market. They recently added a new international wing to their airport—one of the world’s busiest—and they are also working to further develop their interstates and deepen their ports so that they can accept bigger ships and cargo.
Without any shame, Carr speaks about using every network available to him.
“We use supplier networks and we try to leverage every asset to our community,” affirms Carr. “Last year, 75 percent of business expansion announcements were for existing businesses.
“We are proud to work closely with Georgia industry to support them with logistics, workforce, job training, pro-business environment, world-class universities and college.”
Principals: Chris Carr, Commissioner of Economic Development
Business: The Georgia Department of Economic Development (GDEcD) is the state’s sales and marketing arm, the lead agency for attracting new business investment, encouraging the expansion of existing industry and small businesses, locating new markets for Georgia products, attracting tourists to Georgia, and promoting the state as a destination for arts events and location for film, music and digital entertainment projects, as well as planning and mobilizing state resources for economic development.
Famous business magnate Walt Disney once said, “Do what you do so well that they will want to see it again and bring their friends.” In the economic development arena, this has been South Carolina’s winning strategy.
Formula for Success
The Secret Weapon
Making It Happen