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Technology Power Breakfast 2017 transcript

March 18, 2017

IBJ hosted its annual Technology Power Breakfast on March 16. IBJ technology reporter Jared Council moderated a discussion that included ClearObject CEO John McDonald, Ice Miller CEO Kristine Camron, Sticksnleaves Vice President Kristen Cooper, Emplify CEO Santiago Jaramillo, Torchlite CEO Susan Marshall, and Indiana Chamber of Commerce Vice President Mark Lawrance.

Here’s a transcript of the discussion:

COUNCIL: So Indianapolis had a lot going on in 2016, we had the big SalesForce announcement last year and then the CEO of the SalesForce Marketing Cloud, Scott McCorkle, stepped down. Appirio and Interactive Intelligence were acquired in pretty big deals, and we saw new companies like ClusterTruck and Lumavate come onboard. Flexible leasing is a thing now. And I just want to start with Kristine, you've been a local tech observer for a while now. What events, what trends, caught your attention in 2016?

CAMRON: That's a great question. 2016 was very active from a capital-raising standpoint, it was a great year for companies who needed to get growth capital to raise money both here in Indiana but also from firms outside of Indiana, so a lot of companies who have been around for a few years were able to go out into the market and raise capital at very good valuations, and then we saw a lot of activity in our office with lots of companies getting started, folks who were spinning out of some of the bigger companies that had exit transactions wanting to start their own companies and become entrepreneurs, so looking to raise capital from local investors and get started.

COUNCIL: And, Santiago, what about you, we know you sold and launched a company last year, congrats! Any local trends stand out to you that you think we're going to see more of?

JARAMILLO: I do. I think municipalities and cities are rethinking economic development to focus on the entrepreneurial sector and what they can do to help really power some of that early stage, right, if you look at the tech ecosystem it's almost a forest, you've got your towering sort of giants, right, your ExactTargets, your Interactive Intelligence, all of those big ones, and they form up the canopy, and then you've got all of these seedlings sprouting up that are obviously trying to become large trees in the ecosystem, and I think that there's a lot of fertilizer and then kind of water, to continue on with the forest metaphor that's happening. I remember being the first member of Launch Fishers back in late 2012 and then swiping that first credit card and now there's over 600 members and they moved from that original Fishers Library, which was a little sad for me to see because that was where we started a business in this kind of modified storage closet in the basement of the Fishers Library, but it's so exciting to see that they now went from 16,000 square feet in 2016 to 52,000 square feet, signing up 200, 300, 400, 500 members with over 300 companies inside of Launch Fishers, and so I think that the public and private sort of sector partnerships, the public sector is realizing that one of the most important things they can do is to make life a little easier for more entrepreneurs and more innovation to really spring up and take advantage of the shade that those big trees provide and certainly, like Kristine mentioned, the follow-on capital from those folks that have exits acquire some wealth and they're able to recycle those into funding those small seedlings, and certainly for us, we raised a three million dollar Series A last year and a significant portion of that was ex-Aprimo, ex-ExactTarget folks, and so we're sort of a living, breathing testament that those successes at the top of the canopy absolutely help fertilize the ground for even more innovation and entrepreneurship at the ground level.

COUNCIL: And, Kristen, speaking of Fishers, you're up there at Launch Fishers still. A lot of news coming from that city. What's the vibe like up there and what's the profile of people you see getting involved in the tech sector?

COOPER: So I see a lot of men that are business owners and building companies and incredibly smart and talented and I see a big opportunity for more women who have moved their way up in corporate culture that have identified some type of problem and have come up with a solution to figure out how they can prove it out and so I think that there's an incredible culture throughout the state of Indiana of entrepreneurship. However, I think one of the greatest opportunities is for women to take more risks to get involved in the entrepreneurship environments from northern Indiana to southern Indiana and plug into people like Santiago, people like Kristine, Kristine has helped me for years. And I think building on what Kristine and Santiago have talked about in regard to funding, I think there is a big opportunity for everyone in this audience to know that one of the areas that a lot of women struggle with when they are trying to prove out a concept is to secure funding at that very early stage, and so there are so many people, I'd say about age 45 and up, they have a little more disposable time and income, so what a great demographic of people to learn more about how start-ups are building, what you can do to write checks for between 5000 and 25,000 to help those companies grow and ultimately they create more jobs, but I think a very real challenge, not just in Fishers but throughout the Midwest, is the fact that one of the greatest barriers for women to create a scalable start-up is funding at the earliest stage, the highest risk stage, to prove out the concept and I think together we can commit to educating ourselves more about the start-up ecosystem and plug into a lot of our organizations so that you can figure out how you can become an advisor and invest in those companies.

COUNCIL: We're going to get into a discussion about diversity a little bit later. But, John, I want to come to you now and ask you about the Internet of Things. I tell people it's the idea that devices that historically haven't been connected to the internet now are, and give us your definition and describe what an IOT-powered world might look like in 2030.

MCDONALD: Well, good news, I know a little bit about that. So we have this concept in technology called the technological half-life and that's the time it takes for the average user, average device, so half the community to have a given technology, right, so technology half-life of half the population gets the benefit of the new technology. So there are some 33 autonomous vehicle programs underway right now that we know about, 33 of them, and if you don't think we're going to have autonomous vehicles you're mistaken, right, and based on the fact that an average length of a car's life is somewhere between three and seven years, it will take about a year and a half to maybe three and a half years for half the vehicles on the road to have it, so when it occurs it will be very rapid. That small idea, though, changes pretty much everything, not only about how we get around, but also the world in which we live. For example, in a few short years when it's time for me to leave this event I'm going to call a car with my watch and it's going to show up at the front door of the hotel and it won't have a steering wheel in it because the owner of the vehicle who's providing it to me for free doesn't want it to have a steering wheel because they want my eyes on the screens that are inside that vehicle and the advertisers that are paying not only for the vehicle but also for the charge to get me to my house. When I get to my house, I can open up the trunk of the car and inside will be the groceries that I ordered because it stopped at the Kroger Distribution Center before it came to get me, so if the whole world is now powered in this way, literally anything that I want that can be dropped on my doorstep can be had by me with the time it takes to drive it by automated vehicle from a distribution center. It means that if I try on a piece of clothing and it doesn't fit I can put it back in the box and 15 minutes later will come in a new size to my doorstep, so in that world we don't need stores and that means that everything that we would go out for turns from something where I get a particular thing to something that becomes experiential like a personal service or entertainment. That little idea then changes the definition of what a store is and why I would go out, and if every car is automated we don't need as many roads because the reason we have so many is because we have to go out for things and we have to pilot them and keep a safe distance, but if you have a safe distance managed by a vehicle you can run bumper to bumper, we need a lot less roads, and it makes every road a rail line and every car a private train car. We don't need public transportation because all transportation is public transportation. So, you see, that very small idea of an automated vehicle changes every single definition that we come to expect in our world today and that's just automated vehicles. So this idea of the Internet of Things changing everything, I think we've only begun to scratch the surface of this, and there are more reasons why we here in Indiana as the home of companies that make things, move things and grow things should be the leader of this, no reason why we shouldn't.

COUNCIL: Yeah, Mark, we've seen local and state officials get behind this idea, whether they know about John's vision or not, but what do you think is behind this IOT push and sort of what's the goal?

LAWRENCE: Well, I think the goal is to leverage Indiana strengths. I really appreciate the vision that John and others have communicated and I think we need to do a better job of telling that story. As many of you know, we work at the state Legislature, it's not just central Indiana, it's the whole state, there are a lot of good things going on and we have an agriculture background, manufacturing background, logistics and other things, and so I think a lot of this all plays into what the future's going to look like. I think that we need to, and that's one of the things we're working on, to try to educate legislators on what's going on, what are the opportunities ahead of us, what are the implications towards state policy and it gets very multi-layered on that, for example, workforce, huge issue for us, and I know that there's a lot of work being done on that area but we need to do more, so I think the Internet of Things is really both exciting, it's challenging, I think it's good for both early stage and entrepreneurial businesses, but also how do current businesses reinvent themselves to take advantage of that and I think that's something that we need to continue to address and look forward towards.

COUNCIL: So I want to talk now about our roster of tech companies and Santiago touched on some of this earlier. The city has proven that it can grow industry-leading firms with 100 million dollar plus revenues and hundreds of employees and a prime example is our ExactTarget and Interactive Intelligence, but they're getting acquired, and, Susan, I want to come to you first on this one. You lived in California for several years, like how well are we doing at nurturing the next generation of those big kahuna tech companies?

MARSHALL: Yeah, so I moved back here in 2008 from Apple and I worked in Silicon Valley for Adobe, Apple, a lot of big companies, and when I moved back I thought there's no way I'm going to be able to continue my tech career here in Indiana. Even growing up in Indiana I still had that impression that we wouldn't be able to find any great work for me here, but over the last 10 years just the incredible explosion in tech-talent companies has just been remarkable, so I think we're doing really well, but I think we have a long way to go and we're competing with Austin, Nashville, and Charlotte and a lot of other communities, we just need more talent, we need more people coming here, staying here, more ideas, we have a long way to go for sure, but I think we've come incredibly far.

COUNCIL: Santiago, if you think about an IPO or a major exit as the end of a pipeline, what companies in town do you think are the farthest along?

JARAMILLO: I think there's a tremendous amount we talked a lot of seedlings but then there's some kind of more mid-stage plants or trees, or whatever you want to call them. You've got companies like MOBI, right, with a couple hundred folks and it's really good to see certainly a massive emergence of those small folks, but there's actually a decent amount of sort of those medium-size folks, you've got MOBI, you've got First Internet Bank, I see you there, PERQ is doing really big things as they shift to a complete SaaS model, and so it is I think encouraging to start to see some companies break that 20-employee barrier, that 50-employee barrier, a hundred and a couple hundred, but certainly I think that's kind of the most critical part of the ecosystem right now is turning as many of those seedlings that have two and five and ten employees and really helping them scale up, which at that company stage in the life cycle, that's when the Series A and Series B starts to become relevant, and I think that's certainly one thing that we can continue to improve on, great firms like Allos Ventures here in town, to fund, but continuing to have a greater amount of capital available to help those scale-up folks go from those 20 to a hundred. It's going to take, especially when you're doubling or tripling every single year, it just takes capital to be able to fuel that growth, so whatever we can do as an ecosystem on the legislative side, on the corporate side, or on the entrepreneurial side to fuel, to provide more funding opportunities for those folks to break that small early stage and become that mid stage I think is one of the most important things that the ecosystem should be focused on right now.

COUNCIL: And, John, I want to come to you on this one. Obviously, it's going to take time for some of our mid-size companies to mature and I heard that's causing a little bit of a problem when we see some of our larger companies exit. What do you think might be one of the solutions to helping bring in some outside players who can probably fill the gap from the larger companies leaving?

MCDONALD: Yeah, in fact, this was a topic of conversation with Mike Langellier and his team at the last TechPoint board which is this sort of lack of homes for some of the folks that are in the technology internships and also coming out of our great universities and finding places for them to have those starting careers themselves in the technology business. When I left Purdue, I went to work for IBM. I consider those companies to be like puppy mills, I mean the Deloittes in the world, they take on all of these graduates and help them extend their education into their professional world and after about five years, well, you're either a partner or you've found another job at another place. I think it's important for us to recognize that with the great departure of some of these great companies that have exited we've also lost some very sophisticated HR departments that have the ability to groom and to mold a number of these folks, so as a result we probably need to be as a community asking our leadership to come together and ask of companies like Google, companies like Amazon, AWS, companies like IBM, to consider putting development centers and other sorts of places in our state. We have other neighboring states like Michigan and Ohio and others that have done this and those become the place where we can sort of take in a lot of graduates and then we get to at ClearObject go pick from them and bring them over to our company as we go. I think that's a missing piece of our strategy and we ought to start thinking about how we can add that to our agenda.

COUNCIL: Kristine, with respect to IPOs, how much of a role do you see them playing in helping founders return money to their investors going forward?

CAMRON: In my experience I've had one company go public and that was Angie's List. It's very rare, especially in Indiana, to have a company go public. When I sit down with a company at the beginning of my representation with them and we talk about the capital strategy that we need in order to make the company successful, one of the questions I always ask is "What do you think that your potential exit strategy is going to be?" and oftentimes the IPO is not a consideration, it's usually a sale transaction of some stature. A lot of the companies that you see doing IPOs like Snapchat, Okta, they have raised hundreds of millions of dollars and they need to raise hundreds of millions of dollars more to be able to dominate the market in which they're in, so they're going to market to raise more capital to continue with their business play for a continued pursuit of liquidity. Here we don't necessarily always get into that scenario. So if you want an exit strategy and you want it to be a private sale transaction where your salary and your income aren't disclosed on an S1, you don't have to go through several million dollars of bulking up your company with administration and a big finance and reporting team, then that's the way you want to go. If your goal is to be a public company, then we would pick a different route to go. Is that helpful to you?

COUNCIL: Yeah, yeah.

CAMRON: Yeah.

COUNCIL: So we've got three CEOs up here, and any of you can jump in on this one, but would you ever want to run a company?

MARSHALL: Run a public company?

COUNCIL: Yeah.

MARSHALL: Sure, yeah. We're so young, we're only 18 months old, we're in the start-up, get-off- the-ground sort of phase, but that would be something to aspire to. We have a long way to go, though, to get to that place.

COUNCIL: And, Mark, how important do you think public tech companies are here in Indiana?

LAWRENCE: Well, I think they're important for sure for a lot of reasons, certainly the visibility they bring to our state and our community in terms of getting on the radar screen nationally and internationally, that's great. I think that they also bring talent, they have resources. We love to have corporate headquarters here, I mean it's great because they have their talent with that and usually the philanthropy, whatever they do in the community, follows along with that, so a lot of both tangible and intangible benefits to a public company here, and I want to thank -- I think Bill Soards has been just a great example of a person here who's running a public company, the Indiana division, and look what he brings to the table and all the things that they do, so I think it's a great thing that they do for us, and I also think they can help feed the ecosystem, too. I think what makes Silicon Valley what it is is just there's this continued churn of businesses and talent goes from one to the other and it creates a synergy that I think is admirable and I think we're gaining on it.

CAMRON: Just to kind of piggyback on that, from my perspective I think it's talking to my client and figuring out what they want from their exit strategy and what their goal is and what they're trying to accomplish. I do think public companies are great to have and I think they obviously are attractive to the community and the eco environment. I think that there is a lot of administration and additional costs in doing a public company, as David is over there shaking his head, and you have to be very careful, it's a completely different scenario when you're running a public company, what you can say, what you can't say, when the quiet periods are, when you're locked up, I mean everybody's like "Oh you went public." Yeah, you're probably locked up if you're an investor and you can't sell for six months, so that price is going to vary and you have to sell it in tranches, you're not going to be able to sell it all at one time, so there's lots of rules that you have to be aware of, which is why I don't do public work, I like to stay in the private sector, but it's a lot more of an administrative hassle, in my mind, than sometimes it's worth, so it just depends on what the trade-off is.

COUNCIL: I just want to move things along here and come back to the issue of diversity, and, Kristen, as many people know, you're a huge diversity champion and you strive to not make it just a women- only issue or a minority-only issue, but you try to involve everybody. What progress have you seen lately when it comes to increasing the ranks of women and minorities at tech companies?

COOPER: So at tech companies we are as a unit I think raising consciousness about the importance of diversity and I thought maybe we could take a moment to look at this at a macro level and then zoom in at a micro level because I think that some of this information could really help a lot of the male leaders here at your companies. So according to McKinsey & Company companies in the top quartile for racial and ethnic diversity are 35 percent more likely to have financial returns above their respective national industry medians, so that's a significant number. In 2015, the numbers are not in for 2016 yet, so in 2015, the 2020 Women on Boards Gender Diversity Index of Fortune 1000 Companies showed that 17.9 percent of corporate directors were women. Women comprise about half of the total U.S. workforce. They hold half of management positions. They are responsible for almost 80 percent of consumer spending, 80 percent. They account for 10 million majority-owned privately-held firms in the U.S. They employ 13 million people, and they generate over 1.9 trillion in sales. So that's big- picture macro. Let's go a little micro. So national average of women founding tech companies is 20 percent, and while Indianapolis touts itself as a tech hub, not even 5 percent of our founders are women, so we have to ask ourselves why is that? So I think it's important for all of us as leaders to understand that there is systemic unconscious bias in C-suites and in investment firms and so it is incumbent upon us to understand that leadership teams naturally want to groom people like themselves, there is nothing wrong with that, but you miss an opportunity if you keep bringing your leaders, your thought-leaders, to the table that think and act and behave just like you because customers don't think and act and behave just like you, so I think one of the big opportunities for us in this room this morning is to ask ourselves, and when you go back to your offices, what is your leadership team doing to identify, train, mentor and sponsor a diverse group of women for future leadership positions at your company and if you can answer that question, if you can build a strategy, execute the strategy, incent your leaders to build a diverse culture where people truly get to be themselves because if you show up and you really get to be you and then you get to be a great attorney or a great CEO or in my case my experience is in fundraising, so if I can really get to be me, I'm going to play better on a team, I'm going to feel more confident and comfortable when I go out to raise a round of funding for my clients, and so I think we really need to understand that the lack of women represented on boards, in C-suites, investing in those women-founding companies, you need to know that their absence is a challenge for us because there is so much talent, there is so much wisdom, there is so much profitability in our futures if we are sensitive, understanding and take action on developing, mentoring, training and sponsoring a diverse group of women. And I think the other side of that that we all need to think about, and I wonder if the ladies on this panel would agree with me, for hundreds of years women have been assimilating to male-dominated corporate cultures, we have learned to dress like you, we have learned to talk about the things that you want to talk about. Wouldn't it be amazing if we could groom the next group of leaders, male leaders, to support women leaders, and I'm not saying replace, I'm not saying get rid of at all, I'm saying what if we had training programs so that we could groom men to support women in leadership positions, so now instead of saying "But I see women just as I see myself," but women encounter obstacles differently, we have a different set of challenges, and as men you can develop the understanding and the empathy and you know what our challenges are, you can be strategic about helping us move through those challenges, you can open doors to your connections, you can help us get into this C-suite, help us secure funding so that we can build those companies that provide great returns, and we have data, I know the president of NAWBO is here, Carol Curran, she can give you days' worth of data in regard to how women-owned, women-lead companies yield greater ROIs than that of their male counterparts, so again we have to ask why, we have the data, we have the data that proves how valuable a diverse group of leaders are to growing companies. So we can't just be talking about it, we need strategic action plans, and I hope that everyone here -- In fact, I have a list of 25 things that we can do to make those types of changes and I won't go through them, but I would be happy to share the list of 25 things that we can do to grow the number of women in leadership positions at traditional companies and to grow the number of women who are leading start-ups.

COUNCIL: I want to bring some other people in the conversation here. Mark, I'm curious, you work at the Chamber and you're exposed to different industries, and I wonder just for comparison sake what other industries struggle with this issue and which have you seen do well or make progress in it?

LAWRENCE: That's a great question, I'm not sure if I'll adequately answer that, but I think what Kristen said, there are a lot of things in there that are exactly right, I think we're talking about culture and how people were raised and how they look at the world and think about things, it's difficult to change but it can change and I think if you look at where the outcry that came with the RIFRA discussion that was at the Legislature, you had few people who were for it and I think a lot of people just said "No, this is wrong for us" and I think that enters into the diversity conversation. I see it changing, I think it's changing maybe even quicker than I might've thought it would have. I think it cuts both in gender, I think it cuts in terms of your sexual orientation, in the color of your skin and all those things. We're getting better. We still have a lot of work to do, no doubt, but I think it's heading that way and I think it's just going to take persistence over time to get to what the ultimate balance is on that issue.

COUNCIL: And, Susan, some people might say "Well, I've actively looked for diverse candidates, I just really can't find any." Any advice?

MARSHALL: Well, I would say you have to be really intentional about finding people that don't look like you or sound like you or have the same ideas as you. It's hard for all of us to find really good people just in general, especially in the technology industry, and so what we do naturally is we look at our own networks and we get referrals from people that we trust and I think that if you want a diverse workforce you have to kind of look outside your own network, other networks, and just make an intentional effort to go build that kind of culture. We've done that at Torchlite, we have a pretty diverse group of people which I'm really proud of, I was just thinking about how many women we have at Torchlite, I don't know if that's because I'm a female CEO or just we have a lot of talented tech women that happened to've come to Torchlite, but we support these women by if they want to leave at 3 o'clock to get their kids off the bus, then they're back online at 6, you know, whatever it is, so we have a very flexible working environment to accommodate different types of lifestyles and particularly women who are trying to juggle lots of things. But to answer your question I think you just have to work hard at being diverse and actually look for people of color and women and different sexual orientation, that kind of thing.

COUNCIL: I want to talk about technology at the Legislature. John, you chair one of the technology and innovation policy committees and I just want you to give us an update on some of the issues this year at the General Assembly, what agenda items have you guys seen addressed and what still needs work?

MCDONALD: Mark can keep me honest on this, he probably has a cheatsheet on where everything is at. Yeah, I chair one of the two committees, my friend John Wechsler chairs the other one, and both of us have appointed handlers, Bill Soards is mine to make sure that I don't get too far afield on stuff, so thank you for that. So there was sort of a coalescing of some of the agenda items that had been a little bit dispersed across a lot of different agendas, be they broadband or be they funding related and those such things, so the formation of this council has allowed us to pull those pieces together and have one intentional voice. What's been fun to see is how we've been able to really adjust the dialogue in a positive way. Rather than this sort of dispersal of ideas, now we can have one sort of message set that we're driving for and this has been put into action by my fellow committee members in the programs and trends committee as we've done some luncheons, we've done some individual engagement, and it's fun to see the reaction that comes back from some of the folks, "I never knew," "I didn't understand," "Thank you for bringing me that story," "I didn't get that before." So top of our list is a concept of portability of the Venture Capital Tax Credits. Many of you are aware in this state that if you're an angel investor you can get a tax credit for investing your dollars in a registered company, essentially, as a registered investor. Other states have experimented with successfully the portability of that tax credit. What does that mean? It means that credit doesn't do you any good if you don't owe any Indiana taxes. So if you're a potential angel investor that's not in Indiana this doesn't benefit you, so essentially it's a three-party transaction where an Indiana resident could effectively offer up their tax credit to an out-of-state investor who then invests in the company and then the benefit of that exchange goes back to the Indiana resident, it's a three-way party, and we're somewhat at a disadvantage to other states that we don't have this portability, so that's an example of something's that's been very high on the agenda list as an example that I don't think probably would've had the same level of visibility or even understanding amongst our Legislature if the Indiana Chamber hadn't taken the awesome step of bringing those things forward. I don't know if you want to add anything to that.

LAWRENCE: Well, I may add to that and I think that, first of all, I see members of the committee in the room and thank you very much for your contributions. We are trying to bring together a statewide voice to this conversation because ultimately things get done, it just cannot be perceived as central Indiana only, I think sometimes maybe some Indianapolis-envy or central Indiana-envy on that issue. There's a lot going on here, but we have to also tell the story and fortunately there are a lot of great things going on around the state that we need to do it. What John said in terms of the diversity of topics that are important to technology and we ramped up fairly quickly, we put together a tech policy agenda really in pretty short order of three meetings and I would say it's a good agenda, I think we're going to have a lot of work to do in this next round when we really keep fine-tuning it and improving. Let me give you a couple examples of things that are in play right now. The budget bill, which this is the budget year, so every other year they have to pass House Bill 1001. There are several concepts embedded in 1001 that we like, the Venture Capital Portability and Transferability is in 1001, we hope it stays there. They have ingredients of the billion dollars over 10 years that was announced in July when then Governor Pence was all of a sudden -- you know, when the VP thing came up, but there's still a lot of concepts there. Fortunately, we have good leadership. I think Governor Holcomb has embraced those ideas, he's changed a little bit about how Indiana funds can be invested, I mean Indiana resources, for example, the Major Moves Trust Fund which is 500 million dollars from the toll road lease, it's invested in very conservative investments right now and there's language in 1001 that says there's going to be a board appointed to help direct half of those, so 250 million dollars, that would lean towards Indiana businesses, but they certainly have a fiduciary responsibility to the fund. There are some things going on to improve certified technology parks around the state to help really define and refine the criteria for their re-selection of that, that's really good. There's a really important bill, and this is an under-the-radar thing, thing, we may not see the impacts of it for a little bit, but it's management of government data that's going on, the state government by its agencies has a lot of data coming in with improved data analytics, with things we can get into, artificial intelligence and other things to take this data and make it useful for ultimately helping Indiana be a better place for its citizens and it has to do with education and workforce and what's going on with demands of businesses, where the problems are, where the opportunities are, so we're working a bill on that. And one final thing is we thought that a lot of these issues would go through sort of like one committee, they have like a Commerce and Technology Committee, and at first going into Session I thought it would be more or less you have to educate the committee first and foremost, but I guess the good news is the bills are all over the place, they're in utilities on broadband, they're in Budget and Ways and Means for 1001, they're in the Commerce and Technology, so we have to educate the whole Legislature, it's a big pull to do that but we're working on that.

MCDONALD: Hey, Jared, if you'd let me just real quickly on one thing there, I think it's important for people to understand the technology business is very weird in that everything that we do right now in somewhere between three and five years is completely obsolete, okay, and people ask me all the time why is venture capital so important to the technology business. Well, the reason is that it's like oxygen, it's like water that you have to pour on a technology to grow it faster because if you wait for the normal business cycles to play out, you can't have the sort of recurring revenue streams to optimize the use of the technology before it becomes obsolete, it's what drives the actual industry, and so we're at a real disadvantage in our state without having sort of a mature ecosystem of venture capital, so ideas like this billion dollar initiative, what needs to emerge is a fund-to-funds approach where we've had experience in seeing other states do this where they sort of seed a fund that then encourage other primarily out of state venture capital organizations to co-invest with them in that fund which diversifies the risk for the state and for the other investors, increases the size of the pool, and allows us to really pour that oxygen on the appropriate companies for which we have so many early seed stage organizations but not enough, as we've talked earlier about, employment and that sort of thing of folks that are progressing to a later stage, it's a very, very important agenda item.

LAWRENCE: Jared, I want to just build on that. I just want to impress on everybody, this is very, very important, your legislators, if they hear from you, that makes such a difference, and you may not realize that, you may not think they listen, but honest to God, if they get five or six phone calls on an issue, that's a tsunami. Do not underestimate your power and ability to get things done and if there's a bill that you're interested in, please track what's going on and let your legislators know this is important to you. They hear from few people here and there, but it's shocking how little communication goes from constituents to the legislators.

COUNCIL: Just to broaden this discussion about policy out a little bit, Santiago, I want to come to you on this. Post-RIFRA do you find yourself paying closer attention to policy-making here at the state level and the federal level?

JARAMILLO: So a little bit, so the things that we do certainly have an impact as we think about attracting talent from out of state and us saying "Hey, do you want to relocate to Indiana? We're here in Fishers" or "We're here in Indianapolis" or "Carmel," or wherever it is, and many times we need to sort of import that talent. The perception of the progressiveness and the inclusiveness and the tolerance of our state matters for talent attraction. We all say that people are our most important asset in our businesses. As business climates change and different things change, innovation for our business becomes even more important and so does customer service and it's people that drive that, it's people that drive customer service, it's people that drive innovation, and so as we think about the public perception, however real or perception or not, it really does matter, and so certainly for us as we think about out-of-state candidates, sometimes things, stumbles, like that as a state hurt our ability to both attract financing and attract the right talent for us, so absolutely, that continues to be top for us. Sometimes you have to import talent out of state and the perception of our state matters, but I think that there's a parallel there, too. To talk a little bit about the diversity issue, McKinsey talks about there's an evolution of leadership and work environments that's happening. We nailed sort of the IQ side of it, the intellectual quotient as the operational side, and then about 20 years ago we started paying attention to the emotional quotient side, the soft skills in business, and now we've got 34 percent of our entire workforce being millennials now. So the millennial sort of challenge isn't coming 10 years or five years or three years from now, it's here today, and Generation X stayed an average of five years in their companies and Millenials are staying an average of two years in their companies, and so how do companies manage that turnover so it leads back to having that perception of Indiana being an open state but it's also leaders realizing that the old way of leading is now becoming no longer relevant. 70 percent of all employees are disengaged, 70 percent, that's the most optimistic statistic out there, and I think that Indiana has always been known for its good people and I think that we have an amazing opportunity to make Indiana a much more progressively seen type of state and I think it starts at the company level and paying attention to gender diversity and ethnic diversity and seeking to create different working environments, there's so many things that we do that are vestiges from the industrial revolution and how "work was always done, sort of a top-down-command-and-control, and we see the top cultures that are recognized. Lessonly just won an award by "Entrepreneur" magazine, they had one of the best cultures, and knowing Max and the way he leads it's not as much about a top-down, sort of command-and-control, it's about listening to employees, it's about having a noble vision to make the world a better place and not just profit-minded, and so I think there's something at the business leader level that we can do to pay attention to the culture and the engagement of our folks and obviously we saw enough opportunity to sell an entire business and go into Emplify because we realize that so much of culture and people has been an art for so long and we wanted to inject with science, how do you have a people KPI and all of that, so we're really seeing our companies that care about employee engagement and they care about culture to begin to turn the tide of the entire state's perception of that and attract the best people and be able to retain them.

COUNCIL: I want to talk about SalesForce here in the time we've got left, and I think it's pretty well known that 800 jobs over the next five or six years is a lot and that this investment stands to have a big impact on our community here. One thing I'm curious about, and I know, Susan, that you actually used to work for SalesForce, how well do you think that they're going to be able to do when you see different leaders like yourself leave and go start other companies? I know we had somebody recently, Bryan Wade, I believe, who went to Sigstr, how well do you think they're going to do with that sort of element at play?

MARSHALL: I think SalesForce is always going to be able to attract great talent, I think they have a wonderful culture, they pay people well, lots of different opportunities, different types of jobs, and I think it's great for the start-up community and the growing scale-ups as well because they'll be able to bring people I think from out of state because of the high salaries that they can pay, and then because people do tend to move around and look for other opportunities, if we can attract them with those big rocks like a SalesForce, I think then we'll all benefit from that talent just being infused into the pool here in Indianapolis, so I think it's all good for our tech community, for sure, and it attracts people from outside the state who are looking to invest in Indiana, they will start to pay attention to us more. As I've been raising money I've noticed that we're on the map, they know where we are, and I think it had a lot to do with SalesForce, so I think it's all good, all good stuff.

COUNCIL: And, John, does that help with the issue that you talked about earlier with the puppy mills?

MCDONALD: It does. I want to see SalesForce hang their shingle more than on the old Chase Tower, I want them to be opening up dev centers and be an active consumer of the product that we have in our universities and that's not to say that they're not, but I'd like to see us work with concerted effort to encourage acceleration of technical hiring here in Indianapolis, I think that's low-hanging fruit and maybe our first potential win in that area.

COUNCIL: And, Kristine, just to go back to some of the policy discussions that we're seeing around the country with tech firms speaking out on different social issues, whether it's LGBT rights, immigration and so on and so forth, I'm just curious have you had to talk with any of your clients about taking a stance on an issue and even if not what would you advise them in such situations?

CAMRON: Not recently I have not. We have had some activity in other groups in my firm regarding immigration and how it is affecting the technology space in terms of the talent pool and bringing in developers and other sources of talent and whether or not we should push that issue even further with the companies that we're working with and making it more well known. You see companies on the coasts who are making it an issue. I have had to work with a company before about issues that have come up. In that scenario it was a difficult situation because the CEO was very determined to make a statement about what he believed in and you can counsel him on what you think the risks are and the pros and cons of making a statement which may or may not have an impact on the business. In this case it did, they lost their funding and they decided to move forward without it. So I think that in our role we often discuss what the impact will be, how the investors will respond, how the consumers will react and weigh those risks, what are the benefits, how can we best handle the situation and how can we spin the story in a positive way so that people can understand the position that we're taking.

COUNCIL: And we've seen this short-term leasing trend pick up a little bit here in central Indiana, probably the most notable example of that is The Union 525 opening up where you can sign one to three year deals instead of seven to ten year deals, and just want to get a sense of how big of a deal that is for tech companies here. I'll start with you Kristen, I know you guys are up at Launch Fishers, just what do you think the spread of this model might mean?

COOPER: The model is exciting and it's been repeated several times throughout the state, so there are lots of opportunities for one-two person companies to go into a co-working space and build their networks. I think the next stage in the evolution is to provide physical space for those companies that Santiago mentioned, you grow from two to four to up to 10, that's a magic number, and Sticksnleaves has encountered this challenge, they've experienced incredible growth over the last seven years and now we're to the point where we want to be able to graduate from Launch Fishers, just like Santiago did, which is a huge success story, but finding the right space with a flexible lease deal so that you can continue to grow that is challenging because all of the funding that you're either raising or the funding that you've made from your company you're investing right back into talent, so I think that if we can work with commercial spaces so that you can graduate from co-working space into short- term leases that still allow you to focus most of your profits being reinvested into good talent acquisition. Three years from now they're going to be in those more traditional leasing types of agreements, so I think there's a big opportunity if you're in the commercial real estate space.

COUNCIL: We've got an audience question here about autonomous cars, John, so I'm going to throw this one at you. Given the expected arrival of autonomous cars, is Indianapolis misguided in increasing its investment in traditional transit?

MCDONALD: No, because we don't have them yet and people have to be able to get from place to place. It's the biggest dividing line between the haves and have-nots. We're all very fortunate to be able to drop in our cars this morning and drive downtown and get caught in the same traffic jam that I did, but if you're living in our city and don't have ready access to a vehicle, public transportation is your only way to get groceries, it's your only way to get to your job, it's the only way to get to your doctor's appointment, and so, no, I don't think it's misguided at all. I think eventually the need for subsidized public transportation falls away because I think the reason Google has got the Google car project is because they're in the business of selling eyeballs to advertisers and they can turn the time that you're in your vehicle into more time in front of their advertisers, so they are compelled by their business model to offer you an opportunity to do that, that's why that will change, it's an economic driver, but it isn't the case today, and so no, I don't think it's misguided at all, especially if we treat it as a bridge transition type of strategy.

COUNCIL: Susan, I want to get your thoughts on that element of these big tech companies using autonomous cars or any other sort of service as another channel for marketing, what do you think about that?

MARSHALL: Well, one of the big challenges today is that there are so many ways to reach customers, there's so many new technologies that are coming out in the market to reach and engage with customers and businesses are struggling, they just can't figure out how to harness it, get anything done. Many people are just trying to get an e-mail personalized and out the door still, so let alone figuring out how to take advantage of the Internet of Things or self-driving cars, we just see people saying "Gosh, I've just got to get my data in one place and if I can just figure out how to do this e-mail thing right," so I think we're way off in figuring out how to do that, but we'll need more and more technologists who know how to leverage that stuff.

COUNCIL: We are getting ready to close out and one thing I like to do every year is just get sort of everybody to pull out their crystal ball for a little bit and project what you think are going to be some big trends over the next year or so. So we'll start with Kristine.

CAMRON: I thought it was "last but not least." I think I still see the market very active and frothy with respect to capital raising, I think that's going to actively continue. The valuations are holding firm. I think we're going to see some liquidity events with some companies here in the city by the end of the year which will hopefully put more and more capital back into the market so we can continue to grow the ecosystem that we've been so lucky to have over the past several years.

COUNCIL: Kristen, you're next.

COOPER: I think we're going to see more women secure investments so they can grow their companies, so entrepreneurs like Emma Hostetter, founder of the Borrowed Boutique, Ashley Scott, (reporter did not get company name), Aimee Kandrac, What Friends Do, they are all building scalable companies and need investments, so if anyone in here is interested in playing a role as an advisor or as an investor please come talk with me, I would love to be able to plug you into these growing companies.

COUNCIL: Santiago.

JARAMILLO: This is all I think about, so I'll piggyback on this. I think the next decade is the decade of human capital, I really think so. There's been decades of sort of capital, monetary capital, being a huge focus and obviously that will continue to drive so much of the economy, but I think leaders will continue to focus on how to deal with the millennial problem, how to deal with ever increasing amounts of turnover, of finding out that their annual survey is broken because they quantify every other part of their business quarterly and monthly but their people are not being measured and assessed and figuring out how to have a conversation with your people, what can I do for my employees this quarter that's going to help create a better culture, and I think ultimately the companies that attract and retain the best people, including the millennial generation, will be the ones that in five and ten and 15 years will win in their markets.

COUNCIL: Mark.

LAWRENCE: I'll say geometric change is going to continue to happen. Probably one of the best books I've read in the last five years was recommended by Lauren Riga, "The Second Machine Age," if you haven't read it, pick up a copy, it's very powerful, you probably would understand a lot of the concepts, and I think Indiana will continue to adapt, I think we still have a long way to go, but we're gaining on it, it's to me very exciting to see and I certainly appreciate -- The fact that you have record attendance today speaks a lot about the interest in change in technology and what it can do to actually help people live better lives.

MARSHALL: So I think what we'll see is I think the changing workforce dynamic, so 40 percent I think of the workforce will be independent contractors by 2020, so people just want different ways of working, they're looking for life-work balance, they want to be able to work when it best suits them, so I think businesses need to be able to adjust, to be able to support those different types of workers. We're doing that today and I think that leads to a better culture, people stay longer, they're happier, so turning your mindset around the way people really want to work and embracing that I think is something that we all need to look forward to.

COUNCIL: Preach.

MARSHALL: Preach.

MCDONALD: I trace a lot of this back to the RIFRA event, which I know many people look at as negative but I actually have started to think of as very positive because what it did was it was somewhat of a wake-up call for us in the technology community that we were being badly served and it allowed us to start to draw together and start to create some things as a community, and if you look at things like this event, Jared, our INX 3 (phonetic) event with the Venture Club and TechPoint, the Technology Innovation Council, the Indiana IOT Labs, the Indy Xtern Program, if you just pause for a second and think about all of these things are about technology leaders sort of binding together and speaking as one to create bridges and create infrastructure for our community, I think that's remarkable, and I don't think that's ever occurred before, certainly in this state, certainly in this industry, so I think if you put your crystal ball in, I'm really excited to see what's going to happen over the next year to two as we dream up other things and create other sorts of big-bridge strategies to bring our community together and really make big things happen.•

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