‘The next big trend’

With the an­­nouncement of 580 new jobs in Blacksburg and another 225 in Fairfax County, 1901 Group provided, by far, the biggest promise of new employment in the Roanoke and New River valleys last year.

“Our goal of creating high-quality IT jobs clustered in rural areas is the best way to improve quality and performance for the federal government, especially as the pace of cloud adoption increases,” Sonu Singh, the company’s founder, said at the November announcement. “Our revenue and headcount growth are proof that this is the next big trend in rural IT jobs.”

The new hires would triple 1901 Group’s headcount by 2021. According to the company’s website, the company’s name comes from the year the assembly line began to disrupt manufacturing.

“Leveraging skills and materials in an efficient manner within a repeatable process that quadrupled output applies to IT services today,” the site says.

The company provides IT services, primarily to government agencies, from its “IT factory” at the Virginia Tech Corporate Research Center (CRC) in Blacksburg. The company began with about 800 square feet of space at CRC. Now it occupies more than 18,000 square feet, with a new 45,000-square-foot building scheduled to open in the first quarter of 2020.

“We’re busting at the seams right now,” says Brian Lubin, the company’s senior vice president, service management, who has led development of the Blacksburg center.

Much of the company’s growth, Lubin says, stems from helping customers “migrate their mission applications from their more costly government-owned legacy data centers to the cloud” and supporting those cloud-based operations.

“Contrary to what a lot of people understand or know about moving stuff to the cloud,” Lubin says, “certainly the stuff that’s been around awhile, these applications that are migrated require a lot of software development to re-platform, re-factor and in a lot of cases just rewrite the entire application so it can run in the cloud.”

One important aspect of the company’s development since its start in 2009 has been convincing potential customers — especially government agencies dealing with sensitive information — that the work could be done securely off-site.

“If you go back to the beginning of 1901 Group, that was certainly a challenge,” Lubin says. “Certainly, we’ve been able to overcome that challenge with time. Today I would say, almost generically, that isn’t an issue.”

In an interview with Virginia Business last year, Singh said, “The notion that security really is physical proximity to the government is kind of drifting away now, and they’re looking at how do I secure the data, the applications, in ways that are much more advanced than just: I have people come into my office and lock the door in back of them.”

Having the “IT factory” in Blacksburg means 1901 Group can do the work for less, 30 percent less than if it were done in Northern Virginia, according to Singh.

The company and its employees benefit from operating in Blacksburg, according to Lubin. “It’s a great place to live,” he says. “Certainly there’s a lower cost of living in Blacksburg, vis-à-vis, say, the DC area, or any really major metropolitan area for that matter.

“Even though we’re in a small, less dense — from a population perspective — area, we also have access to talent, given our proximity to some great colleges and universities.”

The company’s founder is a Virginia Tech graduate, and most of the company’s work is done at CRC, but 1901 Group doesn’t depend entirely on Tech for talent.

“Virginia Tech is one of many pipelines,” Lubin says. “It’s an important one, but it’s not the only one. … Draw a 20-mile-radius circle around Blacksburg, and there’s probably 50,000 college students that, in a lot of cases, have a technology focus in Virginia Tech, Radford and also New River Community College.”

Not everyone in IT wants a Blacksburg lifestyle, of course, and Lubin says the company sometimes can accommodate those employees with positions at the company’s headquarters in Fairfax County.

“We’ve had some that have actually thought they wanted to go live in Northern Virginia, and then after a year or two, they decided to come back,” Lubin says.

His company isn’t the only one to have a presence in both places.

“There are a number of firms that have offices in the CRC that are playing into similar industries that we are,” Lubin says. “Their headquarters may be here, but they also have a presence in Northern Virginia. Whatever their specific area is in IT, their business model isn’t that different. They’re leveraging the IT capability, maybe some of the wage arbitrage that exists here, to support customers that are up in the D.C. area.”

Lubin won’t disclose what 1901 Group workers are paid, beyond saying, “I know we’re above the county average, and the expectation is that the jobs we add are also going to fit that profile.”

According to the Bureau of Labor Statistics, the average annual wage in Montgomery County in the first quarter of 2018 was $46,124. That’s $47,580 less than the average in Fairfax County.