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byline: Joan Tupponce

Identifying risks

Aerospace and defense organizations in the United States and the United Kingdom are relying on risk management software from Herndon-based Active Risk to help develop the F-35 fighter jet.

“We produce enterprise and project risk software,” says Loren Padelford, Active Risk’s executive vice president and general manager. “Our software helps them understand the impact that risks have on their cost for the project and the schedule for delivery. We work with long-term, high-value projects.”

The company’s Active Risk Manager software is now being used in major energy, infrastructure and defense capital projects in the U.S., Europe, Asia, South America, Australia and the Middle East. Current projects include Crossrail, a 73-mile railway under construction in southeast England, and the Kuala Lumpur Mass Rapid Transit System in Malaysia’s capital city.

Customers use the software to identify risks and the impact they would have on a project. “It tells people the action that needs to take place,” Padelford says. “It allows people to be aware at all times of what is taking place in their business and to manage risk.”

The U.S. Air Force uses the risk management software to determine where it can save money on products that it uses for long-term projects. “It allows them to understand where they are spending their money and if that spending is doing anything positive. It can identify areas of concern,” Padelford says.

Any type of risk can impact project cost and scheduling. “High-profile capital projects cannot afford to leave risk management to chance,” says Padelford. 

Steel maker

The products of Brazilian-based Gerdau S.A. are an integral part of structures ranging from homes and shopping centers to hospitals and bridges. “They are part of power and telephone lines. They are raw material for automotive parts, and they can be found at work on the farm,” says Kimberly Selph, the company’s manager of external communications and public affairs.

Gerdau is the leading producer of long steel in the Americas and one of the largest suppliers of special long steel in the world. “We are a leader in mini-mill steel production and steel recycling in North America, with an annual manufacturing capacity of approximately 10 million metric tons of mill-finished steel products,” says Selph.

The company, which has a mill in Petersburg with 397 employees, acquired the operating assets of Cycle Systems Inc., a metal recycling company in Roanoke, this February. Cycle Systems has nine locations throughout central and western Virginia. The purchase supports the company’s goal to minimize costs “by having scrap sources closer to our steel mills,” says Guilherme Johannpeter, president of Gerdau’s North American long steel division. “It will be a great advantage for our mill in Petersburg and other nearby operations.”

Selph says the North American long steel division has a “diverse and balanced product mix,” which includes fabricated steel and flat-rolled steel as well as wire rod. The company’s North American operations represent 40 percent of its production volume.

Products made in North America are generally sold to steel service centers and steel fabricators or directly to original equipment manufacturers for use in a variety of industries, including commercial, industrial and residential construction; manufacturing; automotives and mining. Gerdau is currently supplying more than 12,000 tons of reinforcing steel for a $791 million runway expansion at the Fort Lauderdale-Hollywood International Airport in Broward County, Fla., one of the fastest-growing airports in the nation.

The company’s special steel division supplies special bar quality (SBQ) engineered steel bars to automotive and heavy truck industries around the world. The Petersburg mill makes products such as steel beams used in the civil construction and consumer products markets.

The company’s roots trace back to João Gerdau, a German immigrant who bought a nail factory in Porto Alegre, Brazil, in 1901. The company began manufacturing steel in 1948 and grew at a fast pace during the next several decades. Today it employs more than 45,000 workers worldwide — 10,000 are in the U.S. and Canada — and has a presence in 14 countries: Argentina, Brazil, Canada, Chile, Colombia, Dominican Republic, Guatemala, India, Mexico, Peru, Spain, U.S., Uruguay and Venezuela.

Doing business in Porto Alegre is similar to doing business in the U.S. because of the large European influence in the city. “There is a great sense of urgency, tremendous focus on the customer, and because it is our headquarters, there is a pride that goes into all of our products and services,” Selph says.

Brazil is the sixth-largest economy in the world and has the third-highest number of Internet users after China and the U.S., according to Selph. “From a technological standpoint, doing business is extremely easy,” she says. “Culturally, there tends to be a great emphasis on developing relationships prior to transacting business and a very strong focus on the systematic management of business processes.”

She stresses the importance of learning the language and the customs of the country. “You need to be aware that different regions of Brazil each have their own unique personality,” she says. “But as in all business interactions, mutual respect, win/win situations and adding value while operating with integrity are the key drivers.”

Porto Alegre, she adds, “is a beautiful place to visit, and the people, in general, are extremely friendly and welcoming.” 

Economy in Porto Alegre
The capital of the Brazilian state of Rio Grande do Sul, Porto Alegre has one of the largest populations in Brazil and is considered an industrial center. The city’s economy depends on industries such as health care, information technology, shipbuilding and high-tech manufacturing. Large employers include Gerdau, supermarket chain Zaffari, media group Grupo RBS, technology company Dell Inc. and software company TOTVS. The city also is home to the Center for Excellence in Electronic Technology, established to develop chips for the semiconductor industry in Brazil.

Visiting Porto Alegre
A modern city located next to the Guaiba River, Porto Alegre has a European heritage. Attractions include the Piratini Palace with French-inspired architecture and Farroupilha Park with monuments, a double Triumph Arch, mini-zoo, market and sports track. The Rio Grande do Sul Museum of Art, designed by a German architect, houses a large collection of art. The city has an active nightlife and hosts the Porto Alegre Carnival each year. City monuments and the Central Market celebrate the area’s gaucho (cowboy) heritage.

Economy in Roanoke
Centrally located on the East Coast, the city of Roanoke serves as the business center for a large portion of western Virginia. Industries such as high-tech manufacturing, health care, finance, education and insurance are helping to fuel the local economy. Large employers in the city include Carilion Clinic, Kroger Mid-Atlantic, HCA Healthcare, Wells Fargo Bank, Advance Auto, Allstate Insurance, Yokohama Tire Corp. General Electric and UPS. Several companies such as custom fiberglass manufacturer TecTon Products, Atlas Cold Storage, which offers specialty warehousing and storage, and Optical Cable Corp. are expanding and/or creating new jobs in the area.

Visiting Roanoke
Situated in the Blue Ridge Mountains, the Roanoke Valley has a strong connection to the outdoors. The area has more than 22 miles of paved greenways and is adjacent to the Blue Ridge Parkway and Smith Mountain Lake. The Valley has a strong railroad heritage, which is showcased at the Norfolk & Western freight station housing the Virginia Museum of Transportation. The museum has the largest collection of diesel and steam locomotives in the country. Roanoke’s historic Farmer’s Market, with everything from produce to art galleries, is the oldest market in continuous use in Virginia. Other area attractions include the Taubman Museum of Art with modern, contemporary, American and folk art, and Mill Mountain Zoo, home to more than 170 animals.

Relaxing in style

People are on the move today, and so is Virginia’s resort industry. Offerings in the works range from a corporate retreat in Caroline County to a luxury boutique hotel in Staunton and an equestrian-style resort in Middleburg (see story on page 48). Plus, a new player has staked its claim in the state’s resort home market.

Natural Retreats US Inc., a British travel and real estate company, bought Homestead Preserve, a second-home resort community, in Bath County in February. The 1,300-acre property is located in the villages of Warm Springs and Hot Springs, close to the venerable Homestead resort.

Natural Retreats opened a U.S. headquarters in Charlottesville last fall to operate Virginia Hot Springs, a collection of luxury-residence locations in Hot Springs and Warm Springs. In May, Natural Assets, a partner company of Natural Retreats, purchased Bundoran Farm in Albemarle County, a 2,300-acre, rural, conservation-based community that was hard hit during the economic recession and eventually wound up in foreclosure.

“Our whole philosophy is to reconnect families with natural parks and areas with natural beauty,” says Chad Rowe, the company’s head of sales for the U.S.

The company oversees 22 properties, the majority of which are in Homestead Preserve. All the properties are homes with the exception of Warm Springs-based Meadow Lane Lodge and Cottages, which includes a bed and breakfast. “That offers fly fishing on the Jackson River as well as hiking and mountain biking,” Rowe says.

Natural Retreats’ clients also have access to concierge services. “We have a full-service concierge team that handles most everything and anything for guests, from tee times to guided expeditions,” Rowe says. “We also have access to The Homestead resort and its amenities.”

In the Shenandoah Valley, Village Development Associates is moving forward on a $28 million project — The Blackburn Inn and Spa in The Villages at Staunton. The luxury boutique hotel will have 102 rooms and a spa. “We think The Villages at Staunton is the perfect location for a boutique hotel due to the charm of downtown Staunton, the location of Staunton in the valley and the beauty of our site,” says Robin Miller of Village Development Associates in Richmond.

Earlier this year the project received conditional approval from the Virginia Department of Historic Resources, enabling it to use historic rehabilitation tax credits and moving it a step closer to construction. Thomas R. Blackburn, who assisted Thomas Jefferson with construction of the University of Virginia, designed the three historic buildings scheduled for renovation.

Charlestowne Hotels of Mount Pleasant, S.C., is expected to manage the property. “We anticipate a major announcement with regard to the Villages site within 45 days,” says Miller, who has done many redevelopment projects in Richmond and Petersburg. “This announcement will include a timetable for the hotel.”

On the drawing board for The Silver Cos. of Fredericksburg is a 12-room corporate retreat on about 1,200 acres of farmland the firm owns in Caroline County. Known as Moss Neck Manor Plantation, the remote retreat will be marketed to businesses. “We have conceptual drawings, and we have cut cherry trees and cedars off the farm,” says Jud Honaker, president of Silver’s commercial division. “The county has to pass an ordinance, and we are trying to push that along.”

While new projects try to get a foothold, some of Virginia’s established resorts are gaining national recognition while others are sprucing up. The Tides Inn Spa at The Tides Inn in Irvington was named No. 22 among the top 75 Hotel Spas in the U.S. by Condé Nast Traveler’s annual Readers’ Choice survey of top spas, which came out in February.

The Keswick Golf Club Course at Keswick Club got a mention in April on the Showtime Sports Network when golf course designer Pete Dye was profiled as part of a 60-minute segment on golf. The course is undergoing a full renovation by Dye and is scheduled to reopen in late spring 2014. It’s adjacent to Keswick Hall at Monticello, a 48-room resort east of Charlottesville. Guests at the resort have privileges at Keswick Club during their stay.

Major capital improvements also are under way at Wintergreen Resort in Nelson County. Jim Justice, owner of the Greenbrier Resort in West Virginia, bought Wintergreen last summer and announced $12 million in mprovements. So far, changes have included a new 5-million-gallon water tank that boosted the resort’s capacity to make snow, and updates to the ballroom and Devils Grill restaurant.

The historic Mountain Lake Hotel has finished a multimillion-dollar renovation and has reopened as Mountain Lake Lodge. The revitalized property includes a new restaurant and tavern. Also new this summer at The Homestead is Allegheny Springs, a water attraction, which includes two water slides, a lazy river, family pool, whirlpool and cabanas.

Gaming for business

Owners: Bill Ritchie and Andrea Barthello
Industry: Education
Website: thinkfun.com

It’s all fun and games at ThinkFun in Alexandria. Owners Andrea Barthello and her husband, Bill Ritchie, wouldn’t have it any other way. “Our atmosphere is relaxed and casual, and we have a friendly, funky look,” says Barthello, who founded the game manufacturing company with Ritchie in 1985.

The company designs and manufactures games for children and adults that “inspire learning, spark creativity and build problem solving through play,” says Barthello. “We work with companies that really get our mission — to translate the brilliant ideas of the craziest mathematicians, engineers and inventors into simple toys that can be appreciated by boys and girls around the world.”

The couple founded the company in the basement of their Alexandria home as Binary Arts because its first puzzles were based on binary code. They changed the name to ThinkFun in 2005. “Binary Arts sounded like a computer design company,” Barthello says. “We thought ThinkFun was a reflection of who we are and what we do.”

The company’s first product, a Disentanglement Puzzle, was shaped like a cat or horse and made of wood and wire. “We sanded and assembled them and sold them to stores,” Barthello says. It produced its first injection-molded product, a brain-teaser puzzle called Spin Out, in 1987, paving the way for mass production. Now the company sells its products around the world. “Our games have been translated into over 20 languages,” says Barthello.

NewsThinkFun was included on the Inc. 500 list of fastest growing private companies in America from 1991 to 1994. It currently produces 60 products. “Over the years we have produced some products and taken them off the market,” Barthello says. “We cull it out by looking for the best of the best and evergreens.” Two of the company’s best-known products are Rushhour, a sliding block puzzle, and Zingo, a bingo-style game for early readers.

The company’s products originally were carried in independent toy and game stores and national retailers such as Natural Wonders and Zany Brainy. ThinkFun’s customer base shifted, however, when those chains closed. “They all went out of business,” Barthello says.

The company continues to sell to independent stores but now has accounts with large retailers such as Barnes & Noble and Marbles: The Brain Store. “We do a lot of business online as well. We sell to Amazon, and we also have an online store for consumers,” Barthello says. The company also has created online games, global educational programs and three mobile apps. “That is our strategy going forward: having an online presence to deliver intellectual property to kids in schools.”

ThinkFun moved from a small office building to its present 8,000-square-foot location on Cameron Street in Alexandria in 1996. The company, now with 32 employees, also has a 40,000-square-foot warehouse in Hanover, Pa. Barthello likes the company’s Alexandria location because it’s close to three major airports. “We also love the historic nature and the character” of Alexandria, she says. “We are a creative bunch here, and we are in a community of interesting people.”

Sales have been affected by the lagging economy. From 2009 to 2012 revenues decreased by 14 percent (the company won’t release sales figures.) This year, however, looks promising, Barthello says. “We are off to a start that puts us to our highest level ever. Our products from last year are being reordered at a good pace. It’s a combination of the economy getting better, new products and our evergreens.”

The company began selling internationally in 1990 when a couple of German buyers saw its products at the International Toy Fair in New York and asked to distribute them. Today approximately one-third of the company’s sales are international. Major markets include Russia, Germany and Turkey. “We sell to almost 50 countries through distributors that sell to stores,” Barthello says.

Chris Gough, ThinkFun’s director of international business, travels to Germany each year for the Nuremberg Toy Fair, the largest trade show in the industry. “It attracts people from around the world,” he says “I go there to meet with other distributors from around the world and show them our new games.”

Gough also attends the game fair in Essen, Germany, which is open to the public. “Our distributor has a booth here, and we are able to get reactions from consumers and users,” he says. “We get people from all over Europe. Many dress up in role playing games such as Star Wars.”

Germans have a long tradition as consumers of toys and games, he adds. “They are willing to bring in games and toys from all parts of the world.” But, games have to be adapted to the German market. “We have to get the games translated, and the distributor does that for us. Germans are pretty particular. Other parts of Europe are more willing to have a multi-language package. Germans typically want all German on the package.”

Over the years Gough has learned the importance of meeting with distributors face-to-face. Not only to introduce them to ThinkFun’s games but also to see how they conduct business. “It’s good to have them come see how we do business as well,” he says. 

GLOBAL:


Economy of Nuremberg, Germany
Nuremberg’s economic base includes employers in high-tech, information, communications, manufacturing and service-related companies such as financial institutions and insurance companies. Its printing industry dates back 520 years. The city is known for having an expertise in automotive engineering, production technology and electronic components. Major companies include technology and service supplier Bosch, health-care solutions giant Novartis, sporting goods companies Adidas and Puma and pen manufacturer Faber-Castell. The city hosts several high-tech fairs as well as the Nuremberg International Toy Fair.

Visiting Nuremberg
Nuremberg’s cobblestone streets and castles are just part of the city’s charm. The city is known for producing dolls, gingerbread, bratwurst and handmade toys. The quaint Old Town section includes the Nuremberg Toy Museum, with toys from the past two centuries. Inside the city walls is the Gothic-style Shoner Brunnen fountain, home to a market selling a variety of handmade items since the Middle Ages, and the Hauptmarkt featuring the city’s famous gingerbread. 

LOCAL:


Economy in Alexandria
Located inside the Beltway, Alexandria has a varied mix of high-technology firms, management consulting companies and service firms. The city ranks fourth in the nation for the number of trade and professional associations based in the city and also is home to the United States Patent & Trademark Office. Major employers include the Department of Commerce; Department of Defense; Alexandria City Public Schools; the Institute for Defense Analyses; CNA, a nonprofit research and analysis organization; and Gali Service Industries, which provides facility maintenance services. Many international companies from countries such as Australia, Belgium, Germany, India, Japan, United Kingdom and France have operations in Alexandria.

Visiting Alexandria
With a prime location on the banks of the Potomac River,  Alexandria offers picturesque views of the Washington, D.C., skyline. The city’s popular waterfront area features restaurants, live music and a variety of street performers. One of the city’s most frequented addresses is King Street in Old Town Alexandria. Destinations there range from the George Washington Masonic Memorial and its collection of Washington artifacts to the trendy Torpedo Factory Art Center. The art center includes more than 80 working artists’ studios, art galleries and the Alexandria Archaeology Museum.  Old Town Alexandria’s Market Square farmers market has been in operation since 1753.

Remember the ‘Crying Indian’?

Mike Baum has vivid memories of Keep America Beautiful’s 1971 “Crying Indian” public-service announcement when he was growing up. One of the most successful advertising campaigns in history, the video ends with a tear running down the cheek of an American Indian after he examines the effects of litter and pollution. “It was amazing,” says Baum, the executive director of Keep Virginia Beautiful. “It showed the impact of litter and how one individual can make a difference.”

Baum credits the formation of the Virginia Anti-Litterbug Council in 1953 — the genesis of Keep Virginia Beautiful — to that same one-individual-makes-a-difference scenario. (The Virginia organization is a state affiliate of Keep America Beautiful, also founded in 1953.)

The council started after someone contacted Gov. John S. Battle to voice concerns about litter on the state highways. “That person was persistent,” says Baum. “So many things happened because of one concerned citizen” whose name remains unknown.

Keep Virginia Beautiful serves as the statewide voice for litter prevention, waste reduction, recycling initiatives, beautification and environmental education. “Our mission is to engage and unite Virginians to improve our natural and scenic environment,” says Baum.

The methods used by the organization to carry out that mission have changed in the past 60 years. From the 1960s to the 1980s, the volunteer-run group created several longstanding small community programs as well as a statewide awards program. But the movement began to founder in the 1990s when state budget cuts eliminated its main source of funding. The group also struggled to stay connected to its constituency. “There was stagnation,” says John Deuel, the executive director of Keep Norfolk Beautiful,  who served as a consultant in the organization’s relaunch in 2009. “There was not a lot of rejuvenation over the years.”

As part of its relaunch, Keep Virginia Beautiful adopted a new strategic plan and hired Baum to guide its efforts. Since then, it has been aggressive in developing programs and creating partnerships. “It has become newly vibrant,” says Deuel.

The organization is now funded by a variety of sources. The majority of its money comes from grants from supporters such as Altria Group, Wal-Mart, Dominion Resources, Waste Management and Lowe’s. It also raises money by staging events such as the KVB Gala scheduled for Oct. 5 at the Virginia Museum of Fine Arts. “Events like the gala help fund our initiatives across the state such as litter prevention awareness and increasing recycling at festivals and events,” says Baum.

Campaigns such as 30 Grants in 30 Days and GIVE 60 are helping the organization increase its exposure across the state. This year marks the third year for the 30 Grants in 30 Days initiative, which gives away grants to 30 community groups in 30 days for litter prevention, recycling programs and beautification efforts. Grants range from $500 to $1,000.

The GIVE 60 campaign offers families and businesses the opportunity to either give 60 minutes of their time volunteering in their communities or $60 to KVB. “We are encouraging folks like we did 60 years ago to make a difference,” Baum says.

To spread its message, KVB is tapping into social media and offering a variety of outreach efforts on its website. “We share the positive results and opportunities that other groups are doing,” says Baum. “We also promote our efforts through state agencies like the Department of Environmental Quality, Virginia State Parks, Virginia Green [the green arm of Virginia Tourism Corp.] and other organizations.” Last fall, for example, the organization placed 250 95-gallon recycling carts in state parks to supplement the parks’ recycling efforts.

Recycling is a major focus. The organization is working with the City of Richmond to make outdoor events in the city as green as possible. Thanks to a grant, it purchased 100 roll-off carts with recycling logos. The carts were used at 22 events last year, including Broad Appetit and the Richmond Folk Festival. “We had over 24,000 pounds of recycling because of this initiative,” Baum says.

Stopping littering is an ongoing effort. Despite vivid public memories of that 1971 PSA, people continue to toss out trash. “Cigarette litter is one of the largest forms of litter in America,” says Baum. “Part of what we do is create awareness that it is litter and provide opportunities for people to dispose of products like that. We distribute pocket ashtrays at events. We gave away over 2,000 at The Richmond Folk Festival last year.”

Last year Keep America Beautiful chose KVB to host the National Days of Action, part of the Great American Clean-Up, in Hampton Roads. It completed 90 projects in two days. “We had over 1,700 volunteers and we picked up 125,000 pounds of trash and planted trees all over Hampton Roads,” Baum says. “This was a regional effort with all the Hampton Roads jurisdictions. We had corporate volunteers, individuals and military groups coming together to deliver long-term results for [the area].”

Baum is excited about the organization’s potential. “We are trying to make a positive and lasting impact just like the impact of the ‘Crying Indian.’”

Reliable supplier

RETAIL/WHOLESALE:
New Day Office Products & Furnishings Inc., Suffolk
www.newdayoffice.com

Matt Brady, the owner of New Day Office Products & Furnishings Inc., says many of its customers are looking for more than chairs and desks. “Our ideal clients are those that see their purchases as more than just furniture or products; who place value in the environments they create,” says Brady.

New Day, founded by Brady’s father, Chuck, in 1987, sells high-quality commercial furnishings and provides services including interior design, project management and strategic planning. “Our customers typically see interiors as thriving spaces. They see that they are a way to demonstrate new investment in the company, facilitate collaboration and attract and retain top talent,” says Brady.

Brady grew up in the business, working part time until his graduation from Virginia Military Institute when he became a full-time employee. He took over the role of president in 2008. “In 2011 the ownership of the company was officially transferred to me,” he says.

NewsThe company moved from its original location in Portsmouth to a larger facility in Suffolk in March 2012. “We needed to create a world-class showroom space that was also functional,” says Brady, adding, “This is a good central location.”

From 2008 to 2011, the company grew 1,069.16 percent. Brady credits that dramatic growth to the company’s “proven success as a solid and reliable supplier” and its efforts to provide clients with “seamless procurement strategies.”

New Day spearheaded a five-member team process that has attracted attention from architecture and interior design firms. “They latched onto it,” Brady says. The team concept includes an account representative and project managers as well as a lead installer and designer who monitor all aspects of each order. “We guard clients against the common errors of our industry,” Brady adds.

Last year the company aligned with Michigan-based Haworth Inc., a major designer and manufacturer of office furniture. “We are the exclusive dealer for the Hampton Roads area,” Brady says. “It represents a significant amount of commercial and government business.”

New Day’s customers include financial institutions, health-care facilities, higher education institutions, federal government agencies and the military. Seventy percent of the company’s revenue is generated by contracts with the federal government and the military. The remaining 30 percent is tied to commercial business. “We are always doing government work,” Brady says. “Our typical contracts used to be around $100,000 and now they are between $300,000 and $3 million.”

Brady sees the future as positive even in light of recent government cutbacks. “We have some very large corporate customers that are getting ready to sign with us, and they have large projects coming down the pike,” he says.

Brady is diversifying the company. “Two years ago we were 90 percent federal and 10 percent commercial. Next year we should be 50/50.”
The company has completed projects in 40 of 50 states. It also has worked on government and corporate projects abroad. Many of the government projects have been in Spain and the Azores. “We would like to continue doing work abroad and focus on winning more of that business,” Brady says, adding that he sees room for growth. “We will continue to do the things that we are doing right and to improve in processes.” 

Keeping a government presence

SERVICE:
Veterans Enterprise Technology Solutions Inc., Clarksville
www.vets-inc.com

Veterans Enterprise Technology Solutions Inc. (VETS) was started by “two broke guys” in Jim Moody’s basement in 2005. Today it is the second-fastest growing private company in Virginia.

The company offers its federal government clients a variety of services ranging from computer-based 3-D simulations to mail operations. “All of our work is with the government,” says Moody, VETS’ president and CEO. “Most of our work is prime contracts. About 15 to 20 percent is subcontractor work, but it’s still government work.”

Moody, a retired Navy officer, began the company in his Reston home with business partner Jim Case. “It was two broke guys,” Moody says, adding that he became sole owner of the company in December 2011. “We moved the company to Clarksville about six years ago.”

The company now has 480 full-time employees. Last year, it was ranked No. 160 on the Inc. 5000, the magazine’s list of America’s fastest-growing, private companies. From 2008 to 2011, revenues grew 2,084.21 percent. “It came from having a good team in place coupled with a lot of hard work and writing good proposals,” Moody says of the company’s growth. 

The company’s IT services include software and database design, training, and testing and evaluation. “We have done a lot of interesting things,” Moody says.

One project for the U.S. Air Force’s Headquarters Air Combat Command involved a training system that used 3-D simulations in the coursework. VETS also created software programs for Veterans Affairs, including the HealtheVet project, which allows veterans to access their medical records.

News VETS won its first prime contract with the federal government in February 2007. “It was a vehicle to grow,” Moody says. The company now has 50 government contracts and provides IT services to federal government agencies in 12 states. The company’s largest customers are the Department of Homeland Security, the Department of Veterans Affairs, the U.S. Air Force and the U.S. Army. VETS also works with the Small Business Administration, the USDA, Federal Aviation Administration and Department of Defense.

One-third of the company’s revenues come from Operation Support, a contract with the U.S. Citizenship and Immigration Services (USCIS) at the Department of Homeland Security. VETS won the contract in November 2010 and began operations in February 2011. It provides mailroom, file-room and operation support at USCIS service centers in Lincoln, Neb., and Mesquite, Texas. “There are hundreds of thousands of files. They come in by the truckloads,” Moody says. “We process the mail and get it ready for the adjudicators” so they can process applications for citizenship.

In addition to its headquarters in Clarksville, the company also has offices in Reston and customer contract offices in Alexandria, Washington, D.C., and O’Fallon, Ill., at Scott Air Force Base. “In Illinois, we support Defense agencies within the U.S. Transportation Command,” Moody says.

Even though it relies on government contracts, Moody believes the government sequester will have only a minimal effect on the company. “Most of the agencies we support are industrially funded,” he says, explaining that those types of funds help pay for work produced by contractors.

Moody would like to expand the company’s footprint in the government. “We have a lot of proposals in,” he says. “We are hoping to grow 25 percent in 2013.” He would be thrilled if he could keep his promise to employees to double revenues every year. “We have pretty much done that every year we have been in business,” he says.

Moody finds it personally satisfying to create programs for agencies like Veterans Affairs that deal with the public, he says. “We feel like we are helping people.”

A results-only focus

Loudoun County was just the right fit for California-based iGATE’s newest facility, thanks to its proximity to Washington Dulles International Airport and Washington, D.C. The technology firm opened a 10,000-square-foot office in Loudoun last August.

Being close to Dulles gives iGATE “access to 80 percent of the world’s economies — a key advantage to a global organization,” says Tim Coffin, president of iGATE Government Solutions, a subsidiary of iGATE. “In addition, with more than 900 federal government contractors located in Loudoun, and with almost 20 percent of the county’s work force employed by the information and communications technology industry, doing business in Loudoun makes perfect sense for a company like iGATE.”

Sunil Wadhwani and Ashok Trivedi founded the firm in 1996 in Pittsburgh to provide technology-based consulting and staffing services. The founders stepped aside from active management in 2003 when Phaneesh Murthy, the former head of global sales for technology consulting firm Infosys, became CEO and moved the company’s headquarters to Fremont, Calif.

Today the company provides technology consulting and product and engineering solutions as well as business process outsourcing in areas such as finance and accounting and human resources. “This helps organizations increase their flexibility because they can focus on their core competencies without being tied down by bureaucratic restraints,” Coffin says.

Loudoun is not the company’s first Virginia location. In 2011, it opened an office in McLean, which serves as the headquarters of iGATE’s Government Solutions group. That office will work with the new Loudoun facility to offer technology consulting services for federal government projects, Coffin says.

The company’s niche is a business outcomes-based model founded in the philosophy that clients pay only for delivered results. Using this model, a customer sourcing medical claims services, for example, typically would pay only for a desired outcome, such as a reduced claims processing time. “In a crowded and intensely competitive marketplace, iGATE has built a reputation around this model where clients pay for results only and not for any efforts put in,” says Murthy.

The company has more than 300 global clients, including a large number of Fortune 1,000 companies. Customers include the federal government and companies involved in industries ranging from banking and financial services to communications and manufacturing. “The Royal Bank of Canada and General Electric are our largest customers,” says Murthy.

The firm has offices around the world and sales teams in many of its target markets, including the U.S., Canada, Europe, India, Australia and Japan. “Our marketing campaigns are globally collaborated and localized to ensure targeted visibility in the sectors and regions we operate in,” says Murthy. “More than 80 percent of our sales are within the U.S. and Canada, and the rest are global.”

The company has more than 27,000 employees worldwide. It currently has six employees in McLean and plans to create 250 jobs during the next two to three years in Loudoun. In 2002, the company’s annual revenues were $50 million. Murthy grew iGATE, a public company, to $1 billion in revenues in 2012 after taking over the reins in 2003.

The company’s Indian headquarters is in Bangalore. It also has offices in Mumbai, Pune, Hyderabad, Chennai, Noida and Gandhinagar. Murthy sees Bangalore as a good location partly because of its technology-savvy talent pool. Many people who are technology-focused migrate to Bangalore from other parts of India because of the pleasant weather conditions.  The company uses its training programs to build a global talent pool, which has contributed “to the growth of the company,” Murthy says. “We have been ranked as the best IT employer in India over the last six consecutive years across surveys.”

The ranking comes from Dataquest-CMR Best Employers Survey in India. The company also ranked No. 2 in the Greater Toronto Area’s Small and Medium Best Employers Survey in 2012.
Murthy says the company embraces the cultural diversity in India. “India is a land of several languages, cultures and habits,” with employees coming from different regions. “It’s important to align everyone into a common company culture with a unified set of values,” he adds.

Anyone doing business in India needs to “recognize the cultural nuances of the region, from a talent-sourcing perspective through dealing with the administration, bureaucracy and the laws of the land,” he says.

Bangalore’s business-friendly environment is technology-oriented, he adds. “It is called the Silicon Valley of India.” 

Bangalore’s economy
The capital of the Indian state of Karnataka, Bangalore is one of the fastest-growing cities in India. Major economic sectors include information technology, aerospace, biotechnology and telecommunications. The city also has a number of large manufacturing companies such as National Aerospace Laboratories. Companies based in Bangalore include aircraft manufacturer Hindustan Aeronautics Ltd, biotechnology firm Biocon, power plant equipment manufacturer Bharat Heavy Electricals Ltd. and technology giant Infosys. Also based in Bangalore is the Indian Space Research Organization.

Visiting Bangalore
Coined the “Garden City of India,” Bangalore is known for its warm weather and green spaces. The city has several attractions, such as the 2,400-acre Lalbagh Botanical Gardens and Cubbon Park, packed with flowers and fountains. Popular city sights include the Tudor-style Bangalore Palace and the Government Museum Bangalore, one of the oldest museums in India. The city also has many art galleries and theaters as well as a thriving film industry and an underground music scene.

Loudoun’s economy
Loudoun County’s skilled work force and technology-friendly environment have helped it become one of the fastest-growing job markets in the U.S. According to TechAmerica, Loudoun has the “highest concentration of technology workers in the U.S.” Key economic sectors include aerospace, data centers, airport-related services, life sciences, and information and communications technology. The county also boasts 85 international companies from 24 countries. Large employers include AOL, systems integrator M.C. Dean Inc., rocket and space system manufacturer Orbital Sciences, Raytheon Technical Services and United Airlines.

Visiting Loudoun
Loudoun County’s rolling hills are dotted with horse farms, wineries and historic estates. The county has a number of quaint towns and communities. The Middleburg area has horse farms, sprawling estates and hunt clubs. Leesburg is known for its picturesque historic district while Lansdowne is home to Lansdowne Resort. The county’s wineries draw tourists from around the globe. Celebrities and newsmakers such as actor Robert Duvall, business mogul Sheila Johnson and former Secretary of State Madeleine Albright as well as several members of the Washington Redskins have made Loudoun their home.

 

On the rebound

Manufacturing in Virginia finally is bouncing back after a decade of job losses.

“From 2001 to 2010 there were approximately 110,625 jobs lost in manufacturing, and in 2011 there was a net gain of 1,107 manufacturing jobs, reversing the trend,” says Mike Lehmkuhler, the Virginia Economic Development Partnership’s vice president of business attraction.

Lehmkuhler credits the comeback to an improving economy and the “reshoring” trend among companies such as Caterpillar, General Electric and Whirlpool, bringing offshore operations back to the U.S. “We expect that trend to continue,” he says.

Several manufacturers in Virginia have expanded operations during the past year. “Other companies are looking at Virginia,” Lehmkuhler says. “There is a definite uptick. We are expecting a net gain of jobs in 2012 as well,” when all the data is compiled. Continuation of the trend, however, could depend on the ripple effects of sequestration, automatic federal budget cuts that took effect March 1.

Four Virginia manufacturers that have recently expanded are Cadence Inc. in Staunton, Homestead Creamery in Franklin County, Bauer Compressors Inc. in Norfolk and Virginia Transformer in Roanoke.

Cadence Inc.
NewsCadence, which makes precision cutting and piercing instruments used for industrial and health-care applications, expanded its Staunton facility last August, adding about 25,000 square feet and 50 jobs. It plans to add another 65 employees by the end of this year. The expansion was prompted by increasing revenues, up 34 percent in 2012 over the previous year. The Staunton facility now covers more than 93,000 square feet and employs 203 people.

“We have grown well for several years,” says company President Alan Connor, who notes that Cadence knows about projects up to three years ahead of time. (Connor is scheduled to become the company’s CEO in April.) “It was apparent we would need to have more space to grow into anticipatory projects.”

Last year, the Inc. Hire Power Awards named Cadence one of the top 10 manufacturers in the United States and the No. 1 manufacturer in Virginia for new jobs added from 2009 to 2011. “We added 79 people companywide,” Connor says. Cadence also has locations in Providence, R.I., and Pittsburgh, where it is building a new medical device facility. Cadence now has a total of 335 employee.

Cadence is “very pleased with Virginia” as a place to do business, Connor says, but the company may face space issues that would affect future growth. “We have a limitation on our current property,” Connor says. “We are almost topped out.”

Homestead Creamery
NewsHomestead Creamery is in the midst of a three-year plan to expand its production facility in Franklin County and hire 20 additional employees. The new hires will increase the company’s total employment to about 45. The company produces and distributes bottled milk, ice cream and other dairy products. “We have put in some new equipment and need storage for other equipment that we are adding, such as bigger tanks and a freezer area,” says president Donnie Montgomery.

The company’s expansion was aided last year by a $60,000 grant from the Governor’s Agriculture and Forestry Industries Development Fund, the first of its kind to be awarded. Also helping were grants of $45,000 from the Tobacco Region Opportunity Fund and $30,000 from Franklin County.

In response to customer demand, Homestead plans to expand production to include cheese and yogurt. “We made yogurt when we started but dropped it to focus on milk and ice cream and butter,” Montgomery says.

The company’s products are sold in Kroger stores statewide and offered through home delivery. “Our vision is to offer a buffet of products,” Montgomery says. The company also has a retail location in Burnt Chimney that features other Virginia products as well. “Our goal is to be a destination for people.”

Bauer Compressors Inc.
NewsDouble-digit growth has prompted Bauer Compressors Inc. to expand. The company, which currently has 170 employees in Norfolk, will add 130 employees during the next three to five years.

“Bauer is the largest player globally in the area of high-pressure compressors,” says company President Tony Bayat. “You have to have expertise and technology to do high-pressure compressors.”

Bauer’s parent company, Bauer Comp Holding in Munich, Germany, manufactures the equipment the Norfolk plant uses to build compressor systems for specific purposes. Specialties include breathing air compressors used in diving, fire and rescue operations, industry and the military. Breathing air compressors represent “about 70 percent of our market share worldwide,” Bayat says.

The Norfolk facility is Bauer’s largest manufacturing plant outside of Germany. One of the company’s growth areas is compressed natural gas. Often used in fleet vehicles, natural gas is starting to gain momentum with consumers. “That is a growing niche,” Bayat says. “That is going to be a driver for us. Another driver is industrial applications, crash test labs, non-lethal weapons such as paint ball, wind tunnel testing and offshore drilling for oil and gas.”

The company is expanding its Norfolk facilities, adding 18,000 square feet to its manufacturing area and almost doubling its office space with the addition of 13,000 square feet. The design-build project is scheduled for completion in 2014. “Then we will be maxed out space-wise,” Bayat says. “Down the line if we expand, we will have to purchase another building.”

Virginia Transformer Corp.
NewsVirginia Transformer Corp. is adding jobs but not capacity at its plant in Roanoke. The company makes liquid-filled and dry transformers for utility and industrial applications. “We’ve added about 30 jobs in the office and 70 in the shop area,” says company President Prabhat Jain. The company currently has 280 employees in Roanoke. “We continue to grow and add jobs. We are still in the same plant, but in the next few years we will have to build another plant somewhere.”

Virginia Transformer has been based in Roanoke since its inception in 1974. Over the years it has more than tripled the number of people it employs and opened additional manufacturing plants in Pocatello, Idaho, and Chihuahua, Mexico. The company has more than 700 employees total.

The company’s transformers are used in facilities ranging from paper mills and data centers to airports and oil fields in the U.S., Canada and Mexico. “Anywhere they have a large power usage,” Jain says. The company also exports to countries in Central America and Africa.

When the company is tapped out space-wise, Jain would like to stay in Virginia but that depends on a variety of factors, including incentives. “It takes time to find the right location and incentives,” he says, adding that a new plant would add up to 250 jobs.

Jain believes the economy is picking up momentum. “We see a lot of projects coming up,” he says. “That gives us a sense of confidence going forward.”

A measured approach

From its small facility in Blacksburg, Aeroprobe Corp. has carved a niche for itself in the field of precision measurement. Its instrumentation and software products are so accurate that they’re in demand by racecar pit crews and the nation’s military. “The military can’t use a UAV [unmanned aerial vehicle, commonly known as a drone] if the weather conditions are not right. Real-time data allows you to optimize performance,” says Nanci Hardwick, Aeroprobe’s CEO.

Aeroprobe’s products collect information on atmospheric conditions around the drone, measuring things such as air speed, the angle of air and air temperature. Without the accuracy of such data, drones could stall and crash, says Hardwick.

Besides the military, Aeroprobe sells to the aerospace, wind turbine, turbo-machinery, automotive and motor sports industries. Clients include GE, Ferrari, Northrop Grumman, NASA, Boeing and Toyota. The company recently received a contract from NASA to develop a hurricane probe. “Our customers are global,” Hardwick says.

Hardwick is the founder of Schultz-Creehan Holding, a materials consulting firm that merged with Aeroprobe in 2011. “We got involved as a vendor with Aeroprobe,” she says. Aeroprobe saw its sales rise 76 percent in 2011 compared with the previous year. “This is an exciting time for our company. We have a pretty aggressive growth plan for this year, too,” says Hardwick.

The company is building a 20,000-square-foot headquarters and manufacturing facility that could be expanded in the future to 40,000 square feet in Christiansburg’s Falling Branch Corporate Park. The expansion will create 40 jobs — more than doubling the company’s current staff of 30 employees. “We have three wind tunnels, and it wasn’t possible to house them here,” Hardwick says of the two Blacksburg facilities Aeroprobe occupies. “Now we can consolidate and put them all under one roof.”

Montgomery County is a good location for the company, she adds. “We are surrounded by universities, and we have an incredible talent pool.” She also likes the area’s low cost of living, which, she says, “equates to a low cost of business. It’s a very supportive environment for business.”

One of the company’s biggest success stories is the Formula One, lightweight racecar market. “If the driver is heading around a curve at just the right speed, and there happens to be wind hitting him at the right speed and angle, the car can go airborne,” Hardwick says. “They use our products during the race to find out what environment the car is entering into and that information is transmitted to the pit crew so they can be more precise with the car’s speed.”

The company’s instruments range in size from as small as a pen to 9-foot-long turbine blades for wind turbines. Sales are divided equally between domestic and international markets. “Japan is a strong customer base, and the United Kingdom is a big market,” Hardwick says. “France, Brazil and Mexico are growing markets.”

The company uses distributors for international sales as opposed to international offices. Aeroprobe is participating in a state program ― Virginia Leaders in Export Trade (VALET) ― sponsored by the Virginia Economic Development Partnership. Hardwick says it has been helpful as the company tries to grow international sales.  “I had a really large order come in from Korea, and I wanted to do due diligencem and they helped with the research. Their research has yielded new distributors for us.”

Hardwick likes the fact that English is typically the international standard for business around the world. One of the exceptions, she says, is China. “It is becoming increasingly difficult to get contracts in English alone rather than in both languages. The onus is on me to verify that what is written in Chinese is actually the same thing as the English version. If someone is to interpret it differently, which is the binding language?”

Hardwick enjoys working with a global group of distributors, most of whom like to touch base with her on a regular basis. “They like a lot of communication. They like progress reports.” The company’s distributor in the Czech Republic is an avid fan of Skype video calls. “Where it’s really helpful is when someone is speaking in a second language,” she says. “It makes it easier to understand the spoken word. You can see their body language and facial expressions as well.”

The Czech Republic is a good market for Aeroprobe. The company works with the automotive industry in Prague. Matthew Zeiger, Aeroprobe’s vice president of business development, has learned that business is relationship-based in Prague. “We don’t have a problem doing business there,” he says. “All of the technical talk is done in English.”
Hardwick wants to continue increasing the company’s international presence. “It’s a great way to grow the company without having to grow my own staff,” she says. 

THE ECONOMY IN PRAGUE
Prague, the capital of the Czech Republic, serves as an economic center for the country. Industries include pharmaceuticals, computer technology, manufacturing and financial services. Thanks to its picturesque architecture and landscapes, the city has served as a film location for a variety of movies. Prague also is a center of research with 10 public research institutes. Siemens and Honeywell have research and development offices in the city. Other large companies include Virginia-based Accenture, which offers management consulting; networking giant Cisco; and Procter & Gamble.

VISITING PRAGUE
Matthew Zeiger, Aeroprobe’s vice president of business development, likes to stay in Old Town. It’s known for its Gothic architecture and medieval clock on Old Town City Hall as well as the Charles Bridge, which is made of stone. Other popular attractions include the Baroque-style Saint Nicholas Church and Prague Castle with palaces and buildings in a variety of architectural styles from the 10th to 14th centuries. Visitors enjoy watching the changing of the guard.  Zeiger says a visit to the city isn’t complete without a beer tour.  Prague is a world-class beer city.

THE ECONOMY IN MONTGOMERY COUNTY
The Milken Institute’s annual index of the best performing cities ranked the Blacksburg-Christiansburg-Radford metro area the No. 32 Best-Performing Small City of 2012. The index gauges how well metro areas are creating and sustaining jobs and economic growth. Targeted industries include information technology, biosciences, advanced manufacturing and defense technologies. The Virginia Tech Corporate Research Center, home to more than 140 companies, helps the county attract high-tech companies. The area’s largest employers include: Dish Network, a direct broadcast satellite TV service; Carilion New River Valley Medical Center; Federal Mogul Corp., an automotive product supplier; and BAE Systems Ordnance Systems, operator of the Radford Army Ammunition Plant.

VISITING CHRISTIANSBURG AND MONTGOMERY COUNTY
Located in the Blue Ridge Mountains, Christiansburg is the fourth-largest town in the state and the county seat of Montgomery County. Many of the county’s historic artifacts can be found in the Montgomery Museum and Lewis Miller Regional Art Center, housed in the circa-1852 Manse for the Christiansburg Presbyterian Church. The area, located in a large portion of Jefferson National Forest, is known for its outdoor activities such Class V whitewater kayaking and water sports on the New River.