One of central Indiana’s most successful information technology entrepreneurs has accepted a job leading a Baltimore-based
Jay Love, who co-founded locally based not-for-profit software maker eTapestry, will take the reins as CEO of Social Solutions, which makes outcome- and case-management software for social-service agencies.
Love sold eTapestry in August 2007 to Charleston S.C.-based Blackbaud Inc. for $24.8 million. At that time, eTapestry had about 100 employees. Since then, Blackbaud’s eTapestry division has remained in Indianapolis, with Love at the helm, and added 25 employees.
Two of Love’s co-founders, Steve Rusche and John Moore, remain with Blackbaud as executives. Scott Ganyo, the company’s fourth co-founder, left five years ago to pursue an acting and custom-software-development career in Los Angeles.
In a telephone interview, Love said the Charlotte, N.C.-based venture-capital firm Frontier Capital recruited him to Social
Solutions, originally with the more modest intent of putting him on its board of directors. After several meetings, Love said,
he was offered the CEO’s job but declined it because it required a move to Baltimore.
Love, 55, and his wife have two grown sons, one of whom lives in central Indiana with two daughters. Love said he was quite happy with his Blackbaud job. So he made a list of requirements it would take to relocate, including a significant ownership stake in Social Solutions.
“I’ll be darned if they didn’t come back and say ‘We can make those happen,’” Love said.
Although Social Solutions does not disclose its financial results, Love said the private company has about 2,000 customers and is comparable in size to eTapestry's just before its acquisition. The key to its business model, Love said, is the metrics it delivers.
Social Solutions’ software manages people through treatment programs and tracks their outcomes. Whether a social-service not-for-profit user delivers assistance to youth, the homeless or people struggling with addictions, its backers are keenly interested in hard data measuring their success, Love said.
“Do people stay on the straight and narrow?” Love asked. “Those outcomes have become very important to funders.”
Love’s departure from Indianapolis is significant to both the local high-tech entrepreneurial community and not-for-profits, since he has been a mentor to both.
For example, Love was one of the founding board members in 1999 of NPower Indiana, a not-for-profit that helps other not-for-profits with their technology needs. It now serves more than 4,000 groups.
Ron Brumbarger, CEO of Carmel-based Web developer BitWise Solutions, was another NPower founding board member. He called Love a “valuable asset in the local IT community, for sure,” always on the short list of local IT leaders. Brumbarger noted the year Love served as chairman of the Indiana Information Technology Association, a precursor to the TechPoint initiative.
“We need more Jays in Indianapolis. We’re always looking for talent and experience at that management and executive
level. We’ll lose that with Jay leaving, obviously,” Brumbarger said. “But, at the same time, he’s
mentored and trained a lot of people, too. We’ve all been helped by him over the years."
eTapestry’s origins date back to 1997, when development of its software began. Once the software was launched in 1999, eTapestry offered it gratis to a dozen beta customers for six months. Love said those customers became key references for many years. Several liked it so much they began paying for the software three months before the trial period ran out. Looking back, Love said the one thing he would have done differently is give eTapestry’s software away to two or three dozen more beta customers in the early days who could recommend it to others. That’s a lesson for other entrepreneurs.
“If I had to do it again, I would encourage people to take as many early adopters as they can comfortably support,” he said.
eTapestry also deliberately went after customers around the country, so it wouldn’t be labeled a big fish in the little Indianapolis pond. And it pinched every penny of investors’ capital. Love remembers watching other IT companies—which have since fizzled—spend precious angel and venture capital on frivolous expenses, such as first-class seats on flights or even charter airplanes.
Love said eTapestry made sure to watch every dollar as if the money came out of his own wallet. That paid off when eTapestry competed against bigger firms for business. Love said he could show them his company’s balance sheet and current ratios, and prove that it was “a rock-solid little company” on a stronger financial footing than a rival. It also meant eTapestry had to raise only one formal round of venture capital after its early-stage commitments from angel investors, limiting dilution of ownership for its eventual sale.
Love said eTapestry also prioritized customer service from its earliest days. He still sees young companies trip up over that concept, which can make or break a firm in the long run.
“We made sure we smothered customers with unbelievable support,” Love said. “So often, I would meet with other startups and say, ‘Who is in charge of your customer support?' They’d say ‘We hardly have any customers.' But if you don’t set that stage early on and make sure it’s a pivotal hinge customers can count on, they won’t count on it.”
Love recommends that small companies initiate a formal reporting process and build a board of directors as soon as possible, which requires a firm to set both short- and long-term goals, and regularly reassess them. He also believes strongly in encouraging philanthropy within your own company. eTapestry gave a portion of its profits to its own foundation, which then made grants to not-for-profits. Blackbaud kept up the practice, Love said. And under both, employees spent several days per quarter on volunteerism, which Love said is marvelous for morale.
Although he’s leaving Indianapolis, Love hopes others will follow his example and take a chance on entrepreneurship here. Although his day job will be in Baltimore, Love expects to return to the city regularly and remain active here.
“The new jobs created for our state would be unbelievable if everyone with an idea or dream had the courage to execute it,” Love said.
TechPoint CEO Jim Jay expects just that. He said Love has been part of Indiana’s tech sector and philanthropy success, with a significant personal impact on both. Even so, Jay said, Indiana’s technology sector has grown substantially since the late 1990s. The state’s mix of cutting-edge companies is now robust and diverse enough that it’s not dependent on any one individual or company.
“During the recession, when the global private sector was making deep cuts, Indiana actually added new technology jobs
and the state saw venture-capital investments increase by 70 percent,” Jay said. “I don’t mean to diminish
Jay’s impact or contributions. They have been important and lasting. But it would take a Biblical exodus to slow the
momentum of Indiana’s technology industry at this point.”