Digital disruption: Tech, entrepreneurial ecosystem paves way for growth
FIRST IN A SERIES
This is the first in a series of three stories discussing shifts in tech industry trends that could make a positive impact on the Nevada County tech economy. Part two will be published Nov. 5.
Tech industry trends are aligning to make Nevada County an ideal location for entrepreneurial tech businesses and talent.
All we need to do is connect the dots.
Embrace Change or BE Left Behind
The disruption of traditional industries, a shift to cloud-based software, and an increase in working remotely all have the potential to give Nevada County an advantage in growing our local tech economy. Companies like Airbnb, Uber and Lyft have turned traditional businesses upside down.
Businesses that are leading the charge for disruption can be located anywhere, and communities that embrace disruption can easily gain an advantage over their neighbors. Michael Anderson, president of local IT services company Clientworks, sees firsthand how disruption could affect our community.
“Disruption is happening, and it’s only going to continue faster,” he said. “You can’t just ignore it. We have an advantage in our community. We’re small enough to pivot and react to these changes. We need to embrace change.”
Western Nevada County’s video industry represents a microcosm of an industry disrupted, with corresponding success stories and cautionary tales. The video business that Grass Valley Group ignited in the ’60s in our county has evolved into an internationally known cluster of video hardware and software companies. The cluster has expanded and contracted over the past 50 years, and industry disruption could lead to more changes among local companies.
Scott Murray, vice president of product management at Telestream, believes adapting to disruption is key to their survival.
“If there is some sort of shift in the core technology, the company needs to adapt to the technology shift or die,” he said. “The companies that adapt, survive. Sierra Video Systems, owned by Kramer, did not make the technology shift. They closed.”
The Future is Small
The video (or digital industry, as it is now known) is no longer the only tech gig in town, and the days of one big corporation employing 1,500 people may be behind us. Dan Castles, a Telestream board member who recently stepped down from his role as CEO, has been working in the video industry in Nevada County for over 24 years. He sees Nevada County as an ideal place for smaller companies.
“Our tech sector’s future is either large corporations who want to bring their people to a satellite office or a lot of three- to eight-person companies who are doing niche things and don’t need big leadership — lifestyle companies,” he said.
Small software companies may well be the future of the Nevada County tech sector. The industry at large is shifting in that direction, with a mass exodus from hardware to the cloud. Murray has already seen it happen in the video industry.
“It’s all moving to the cloud,” he said. “Video distribution is already there. Companies that are strong in software and cloud processing will have a longer life.”
Castles thinks that Nevada County is well positioned to take advantage of this trend.
“Software is a big opportunity for our county,” he said. “The direction the tech world is going allows for smaller, nimbler companies to start up in Grass Valley.”
Anderson said he has observed an increase in startup activity locally.
“The local video businesses have matured into a robust industry with companies that support hundreds of employees,” he said. “But there is a younger generation that is innovating in Nevada County — the millennials are driving an innovation wave.”
A growing number of people who work at local tech companies have side gigs, designing apps or collaborating on other tech projects.
Working remotely is another growing trend that could benefit Nevada County. When employees work remotely, they get to choose where they live, and Nevada County offers a very appealing lifestyle for young families and outdoor enthusiasts.
A 2016 Gallup poll showed that 43 percent of Americans spend at least some time working remotely, up 4 percent from 2012. Other communities are actively taking advantage of this trend to attract young professionals.
A recent article in Outside magazine highlighted metropolitan areas that are consciously “reinventing themselves as outdoor-friendly tech alternatives to Silicon Valley.”
Erika Kosina, who lives in Nevada City, is a communications consultant and writer for the Nevada County Tech Connection.
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With the economy in California opened back up, businesses throughout the region are finding it difficult to attract employees.