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byline: Veronica Garabelli

Colonial Williamsburg Foundation leader to step down in October

After five years, the head of the Colonial Williamsburg Foundation plans to bow out.

President and CEO Mitchell B. Reiss is stepping down in October when his contract ends. During his tenure, Reiss led a restructuring of the foundation, which was facing declining revenue and visitors to the Colonial Williamsburg Historic Area. The foundation controls assets worth more than $1 billion, including the 18th-century Colonial America living history attraction as well as museums, lodging and other tourism draws, such as the Robert Trent Jones Sr.-designed Golden Horseshoe Golf Club. The nonprofit is searching for Reiss’ successor and hopes to fill the position later this year.

“When the board hired Mitchell, he entered into a five-year employment contract with the foundation,” Joseph Straw, the foundation’s spokesperson, said in a statement. “That contract ends in October and he has chosen to step down when it expires.”

Reiss is exploring other career options, but isn’t ready to publicly announce his plans, Straw says.

As the foundation’s finances hit perhaps the most dire point in its history, Reiss announced a series of dramatic cost-cutting measures in 2017. Colonial Williamsburg eliminated 71 jobs and outsourced another 262 positions to vendors who took over the attraction’s retail, golf, landscape services and facilities management. At the time Reiss instituted the restructuring, annual visitation to the historic site was half of what it had been 30 years prior. Admissions grew from 574,333 in 2015 to 594,378 in 2017, but decreased to 550,171 in 2018. The organization’s total revenue dropped from almost $148 million in 2016 to $127.3 million in 2017, the most recent year reported, according to the organization’s tax forms.

During this time the foundation also repeatedly dipped into its endowment to offset operating expenses.

“While most nonprofit organizations withdraw 5% annually from their endowment, in 2001 we began to withdraw more than 5%, at times reaching as high as 12%,” Reiss said in 2017. “If we continue at this rate, we could exhaust the endowment available to support our operations, including many related to our core educational mission, in just eight years, and perhaps sooner. That outcome would lead to mission failure.”

In 2016 and 2017, the most recent years reported, the foundation withdrew a total of $136 million from its roughly $700 million endowment, or about 10% per year.

On the plus side, The Colonial Williamsburg Co., which operates the foundation’s lodging and real estate units, broke even for the first time in 2018 and turned a profit for the first time ever in the first quarter of 2019, Straw says.

“Mitchell has worked successfully to help Colonial Williamsburg navigate unprecedented cultural and technological shifts, building a record of solid accomplishment under his tenure,” said Thurston R. Moore, chairman of the foundation’s Board of Trustees. “Among other things, he led us through a difficult but necessary organizational restructuring; improved our guest experience; invested in a diverse and inclusive workforce; and completed fundraising to expand and renovate the Art Museums of Colonial Williamsburg.”

Richard Foster contributed to this report 

Charlottesville begins matching funds program

Charlottesville has begun a program offering matching funds to local startups receiving government grants.

The Cville Match program is designed to aid the growth of new Charlottesville-based companies and help the commercialization of their products.

Created by City of Charlottesville Office of Economic Development and the Charlottesville Economic Development Authority, Cville Match will provide matching funds to companies receiving grants from the Small Business Innovation Research (SBIR), Small Business Technology Transfer (STTR) and the Commonwealth Research and Commercialization Fund (CRCF) programs.

Qualifying Charlottesville-based companies are eligible to receive matching funds once their federal or state grants have been approved. The city will match amounts up to $25,000 per-company, per-grant, subject to the availability of funds.

Cville Match also includes VJIP Match, a long-standing economic development authority program providing matching funds to Charlottesville-based recipients of the Virginia Jobs Investment Program (VJIP).

Administered by the Virginia Economic Development Partnership, VJIP is designed to help Virginia-based companies create jobs in the commonwealth.

Virginia Business announces CFO Awards winners

Virginia Business presented awards to chief financial officers at a national apparel retailer, a university, a financial services firm and a trade association Wednesday night.

The awards banquet was held at the Jefferson Hotel in Richmond. Winners at the magazine’s 14th annual Virginia CFO Awards were:

  • Small companies: Cynthia Joyce, CPA, of Agili, a Richmond-based financial services firm.
  • Small nonprofits/government agencies: Richard Lugg, of Virginia REALTORS, a real-estate trade association based in Richmond.
  • Large nonprofits/government agencies: M. Dwight Shelton Jr., CPA, of Virginia Tech in Blacksburg.
  • Large companies: Jennifer V. Whichello, of NSTO LLC, the parent company of apparel retailers Need Supply Co. and Totokaelo, based in Richmond.


Thirty-five CFOs from throughout the commonwealth were nominated for the awards. 

Click the image below to see a photo gallery of images from the night's event.

Photos by Rick DeBerry 

 

 

 

 
 
 

 
 
 
 
 

 
 

 
 
 

Thank you to everyone who helped us celebrate the commonwealth’s top financial officers at our annual Virginia CFO Awards ceremony last night! And congratulations to all the nominees and our four winners: @need’s Jennifer Whichello; Virginia Tech’s M. Dwight Shelton Jr.; Virginia Realtors’ Richard Lugg and Agili’s Cynthia Joyce!

 

Visitor spending in Virginia grew 4.4% last year

Tourism generated $26 billion in visitor spending in Virginia last year, a 4.4 percent increase over 2017.

In 2018, tourism supported 234,000 Virginia jobs —a 1 percent increase from 2017.  The travel industry is the fifth largest employer in the commonwealth.

Tourism also provided $1.8 billion in state and local revenue, an increase of 2.9 percent compared to 2017.

Since the “Virginia is for Lovers” slogan was introduced 50 years ago, the economic impact of travel in the commonwealth has grown from $1.3 billion ($8.6 billion in 2018 dollars) to $26 billion at a compound annual growth rate of 6.4 percent.

Richmond names new economic development director

Richmond has named a new economic development director, but he’s no stranger to the state’s business community.

The city announced Monday that Leonard Sledge has been hired as director of economic development. Sledge has more than 13 years of experience in the field, including serving as director of economic development for the city of Hampton and at the College of William and Mary.


Most recently, Sledge was executive director of the Henry County Development Authority in Georgia. Henry County is part of the Atlanta metro region.


Sledge succeeds Lee Downey, now director of economic and business development for Hunton Andrews Kurth in Richmond. Jane Ferrara had been Richmond’s interim economic development director but has returned to her previous position as deputy director of economic development, according to Richmond spokesman Jim Nolan.

Sledge earned bachelor’s degrees from Morehouse College and Georgia Tech. He holds an MBA from the University of Phoenix. Earlier this year, he was named one of North America’s top 50 economic developers by Consultant Connect.

Charlottesville social club enters the River City

A Charlottesville-based social club will debut in Richmond early next year.


Common House will open a location in the city’s Arts District, a five-story building at 305 W. Broad St.


“It’s a place you belong; your home away from home,” says co-owner Ben Pfinsgraff. “You can grab a seat there and never leave.”

In addition to offering a place to hang out, the venue will host events daily, including talks, workshops, luncheons and concerts. At 28,000 square feet, the Richmond facility will be triple the size of the Charlottesville location.

Many Common House members in Charlottesville use the club for work. The Richmond facility will accommodate business activities by offering co-working and office space on the second and third floors for an additional fee. 

The Richmond Common House also will have an oyster bar, which will be open to the public, as well as a rooftop restaurant for club members.

Common House is the brainchild of Pfinsgraff and co-owner Derek Sieg, a fellow U.Va. alumnus. They are looking to bring a retro concept to a modern audience.

Social clubs used to be common in cities before many people flocked to the suburbs in the second half of the 20th century. Now, urban areas like Charlottesville and Richmond are seeing their populations grow. Cities have plenty of restaurants and concert venues, but not a place that brings those concepts under one roof at an affordable price point, Pfinsgraff says.

He says the club fee is similar in price to a gym membership. Club memberships cost $75 per month for people under 30 years old plus a $100 initiation fee. Those over 30 pay $150 monthly in addition to a $300 initiation price. Couples pay $225 per month and $500 induction charge. Applications are reviewed, but only a handful of people have been turned away.

“Potential members are not ‘judged’ but rather the membership committee alerts management of any red flags, such as infractions against other members, etc.,” Pfinsgraff says.

The business is backed by roughly 35 investors, including Pfinsgraff and Sieg. The investors include prominent Virginia businessmen Warren Thompson, the president of Reston-based Thompson Hospitality, and Ted Ukrop, co-owner of Quirk Hotel, which started in Richmond and is expanding to Charlottesville. Ukrop’s family also owns Common House’s Richmond building.

The Charlottesville location, which opened about two years ago, has 1,200 members. The Richmond venue will be able to accommodate 3,000 memberships. Common House members will have access to both locations. Pfinsgraff and Sieg plan to expand the concept to cities beyond the commonwealth.

“Our initial focus would be to build a network of clubs throughout the Southeast and eventually nationwide,” Pfinsgraff says.

Creating a talent pipeline

The merger of two Virginia firms in mid-June will create a company hungry for data science talent.

Following its merger with Richmond-based Energy Control Co., Sterling-based Connected Services plans to add 100 workers in the next two years, tripling the company’s current combined work force. Roughly 30 percent of new employees will be data scientists — people who can make sense of data to find solutions.

Connected Services analyzes data from smart devices in buildings, alerting their owners to problems, such as leaks.

The company hopes to attract talent from the University of Virginia’s planned School of Data Science, which will be funded in part by a $120 million gift from Charlottesville-based Quantitative Foundation.

“It’s a quicker market approach for us rather than training somebody to say, ‘We need you to understand [energy] and we need you to understand data science,’” says Mike Scelzi, the head of Energy Control.

The $120 million gift is the largest private donation in U.Va.’s history.

The Quantitative Foundation is the philanthropic arm of a Charlottesville couple, Merrill and Jaffray Woodriff. Jaffray Woodriff, 50, is the co-founder and CEO of Charlottesville-based Quantitative Investment Management, a massive hedge fund that uses data science to manage investments. He also invests in early-stage startups through Charlottesville-based Felton Group LLC.

The Woodriffs are U.Va. alums. Jaffray Woodriff, who grew up in a farm outside of Charlottesville, wants to make sure data scientists know how to handle data ethically. That’s an issue that has gained increasing attention at a time when the reputations of many companies have been tarnished by data breaches and privacy scandals.

“It’s very early on with data science, and there is so much progress that will be made in the future,” Woodriff says. “I wanted U.Va. to be a big part of that, especially within the context of responsibly using data [science] and figuring out issues with respect to privacy and regulation.”

Filling a need
In addition to focusing on ethical issues, the school will create a pipeline of highly sought-after workers. According to a survey released in 2017 by the Business-Higher Education Forum and the professional services firm PwC, only 23 percent of college graduates will have data-science and analytics skills by 2021. Yet a majority of employers prefer workers with those skills (69 percent).

Companies can’t find enough data scientists, says Phil Bourne, director of U.Va.’s Data Science Institute and the acting dean of the School of Data Science.  Established in 2013, the institute offers master’s degrees in data science, including dual-degree options for students in U.Va.’s School of Medicine and MBA programs.

The McLean-based banking giant Capital One Financial Corp. has hundreds of open data-science positions. During the past several years, the company’s technology staff has grown from 2,500 to 9,000 employees. That included hiring hundreds of software engineers, developers, and data-science and machine-learning experts.

“We have been known as a leader in enterprise tech, and so we don’t find it as hard as most other companies to find data scientists,” the company said in an emailed statement to Virginia Business. “That said, the broader market — across the country [and] industries — has a massive demand for these skills right now, so it’s becoming more of a challenge for everyone, even the traditional major tech companies.”

Scelzi, who soon will join Connected Services in its merger with Energy Control, says employers want to recruit workers who already have data-science skills instead of training graduates who specialized in other areas. “It’s like saying, ‘I need an accountant,’ and you go hire a CPA,” Scelzi says. “These graduates will know data science and the latest methodology.” 

Firms like Connected Services are willing to pay a premium to nab experts in the field. Scelzi says the data-science positions at the company will pay $70,000 to $125,000. “These people are very sought-after these days.”

Other reports estimate even higher salaries for data scientists. According to the California-based staffing firm Robert Half, a data scientist in Tysons can make $135,630 to $231,000 per year. A related position in Danville, where pay is typically lower, can command a salary of $65,369 to $111,300.

The graduates of U.Va.’s data science institute in 2017 said they were offered salaries between  $60,000 and $145,000 with signing bonuses of $5,000 to $15,000. They received offers from employers such as Amazon, Deloitte, Booz Allen Hamilton and IBM. Their job titles ranged from data scientist and analyst to systems engineer and senior statistician.

The case for a school
If U.Va. already is producing graduates in the field through its Data Science Institute, why does it need to create a school? Bourne points to a couple of reasons. While it awards master’s degrees, the institute is unable to hire its own faculty, an impediment to conferring more degrees to meet market demand.

The majority of the Woodriff gift — $77 million — will be used to hire faculty and staff as well as fund fellowships for students and post-doctoral and visiting fellows. In addition to philanthropic gifts, the school will be supported by a $13 million endowment, tuition, state funds and collaborations with companies.

Additionally, $43 million from the $120 million donation has been earmarked to build a 70,000-square-foot data-science school building. The institute currently occupies 4,000 square feet of space scattered in four buildings. U.Va. hasn’t determined where the new building will be located, but it’s considering five sites. The new facility probably will open in about two to three years.   

U.Va. hopes to incorporate data science into the building’s design and use. One possibility is using data to assign offices or cubicles based on who the occupants are going to meet on a particular day. “We want this to be a showpiece for Charlottesville,” U.Va. and the state, Bourne says. 

Concerns about concept
Plans for the data-science school have been praised, but the concept also has raised concerns.

U.Va.’s faculty senate initially worried that the school wouldn’t have tenured faculty. That issue lead to the university’s decision to award tenure to some professors who will teach at the school.

The faculty senate also raised concerns about how other U.Va. schools and department would be affected by the School of Data Science.

“We addressed that by really being cooperative,” Bourne says. “Our goal here is to raise all boats in the university … to actually help all other schools by what we’re doing, not to compete with them.” 

That cooperation includes working with other schools on creating new degrees and programs.

In May, the faculty senate voted to establish the School of Data Science. It now has to be approved by U.Va.’s board of visitors and the State Council of Higher Education for Virginia. If all goes according to plan, the school will begin operation in August in time for the new academic year.

Yet some observers still worry that the gift may create unintended problems. “For all his money and his good intentions, should one rich guy be able to reshape a city? Or should the city itself have a say in how it might change?” Bloomberg News columnist Joe Nocera asked about the Woodriff gift in a column published earlier this year.

Nocera argues that the data science school and an incubator that Woodriff supports could create tech companies that would dominate the local economy and drive up the cost of living.

Jaffray Woodriff says Nocera misinterpreted their conversation. Woodriff says he’s not trying to change Charlottesville’s character but wants to see more U.Va. graduates stay and consider working for local companies. Only a small percentage of data-science students would take the risk of launching startups, he argues.

“I think it would be a good thing to have students have more options, one of which would be staying in a town that most of them seem to love,” he says.

Woodriff doesn’t regret making the gift or investing in the incubator, set to open by 2021, but he says the backlash is unfortunate. He says he and his wife have given away a significant portion of their income, often anonymously, including local organizations involved with affordable housing as well as the Boys and Girls Club.  

“I’ve been unfairly stereotyped as a person who is just completely oblivious of local social issues — quite a number of people on Twitter have kind of barked up that tree — and none of them know me,” he says.

Many in the Charlottesville area support Woodriff’s projects and believe they will have a positive impact. One is Ben Pfinsgraff, a U.Va. alum who is co-owner of Common House, a Charlottesville-based social club.

“He has given back an enormous amount,” to the Charlottesville region, Pfinsgraff says. “There’s no bigger player than him.”

Virginia Maritime Guide 2019

 

Danville company to be acquired by Idaho firm

A Danville-based company will soon be acquired by a major producer of salad dressings and other products.

Sandpoint, Idaho-based Litehouse Inc. is investing $46 million to buy and expand Sky Valley Foods in Danville. Sky Valley Foods sells dressings, condiments, sauces and organic sodas. The deal will be finalized June 1st. 

Danville will become Litehouse ‘s first East Coast production facility, creating 160 jobs over the next five years. Litehouse also plans retain Sky Valley Foods’ 50 employees.

Litehouse makes salad dressings, dips, cheese, herbs and other packaged products throughout North America.

The employee-owned company has five other manufacturing facilities in the United States, in Michigan, Utah and Idaho.

Gov. Ralph Northam approved a $600,000 grant from the Commonwealth’s Opportunity Fund for the project. The Virginia Tobacco Region Revitalization Commission also has approved a $340,000 grant and a $220,000 loan for the expansion.

Additionally, the company is eligible for state benefits from the Virginia Enterprise Zone Program and Sales and Use tax exemptions on manufacturing equipment. The Virginia Jobs Investment Program (VJIP) will provide funding and services to train Litehouse employees.

Utah and South Carolina were also considered during the site selection process.

Mobile support platform company expanding in Blacksburg

A technology company is investing $200,000 to expand in downtown Blacksburg. The move is expected to create 40 jobs.


The Ozmo platform helps mobile providers and consumers solve software issues. The company’s customers include Verizon and TELUS.


“Ozmo is doubling down on its commitment to growing in downtown Blacksburg,” Ozmo CEO David Catalano said in a statement. “Our proximity to Virginia Tech provides us a unique advantage of access to top talent, while also being able to offer exceptional quality of life for our employees. We look forward to growing locally in order to support the increasing demand for our products worldwide.”


The company will receive consulting and funding from Virginia Economic Development Partnership’s Virginia Jobs Investment Program (VJIP). The initiative supports companies creating new jobs or experiencing technological change in order to support employee training activities.