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While capital is still sometimes hard to round up, the real problem for Utah entrepreneurs is finding, recruiting and keeping top talent, said a group of experts at Utah Business magazine’s entrepreneur roundtable Wednesday morning.
AtTask Chairman Scott Johnson said pressure from Bay area companies has pushed up base salaries for his company by 8 percent in the last six months. He said those other companies “set their sites on Utah talent and this burgeoning tech hub we’ve got at the Point of the Mountain. And at least for us, trying to hire experienced, top-tier talent has gotten really tough.”
The tech talent pool is leaving the state, agreed Robb Kunz, Boom Startup co-founder.
Not only are people leaving Utah, but it’s hard to recruit people to the state, said Adam Zlovik, Bankado founder. “It’s harder to attract people to come here than it is to get them to stay here once they’ve been here.”
Part of that issue is the impression people have of the state, and part is infrastructure issues for the potential hire’s family.
Hal Widlansky, president and COO of Radiate Media, said he is flying to San Francisco this week to recruit someone. To do that, he said he’ll have to convince his recruit that schools are good here and his kids will get a good education.
“There’s a lot of infrastructure stuff that on the surface is pretty problematic. We’re 50th out of 50, by a wide margin, in per pupil spending. Classes are large. There are a lot of things in infrastructure that we as a state are choosing to not address and have been for several years that make it challenging to get folks to get over the hump to consider moving here.”
He said, “It’s a systemic problem… that limits our ability to get people who care about things like education. And – newsflash – smart people who do great jobs at a high level in companies care about education for their kids.”
Utah can also be a difficult place for spouses or single people to move because there can be a big cultural gap between the state and Silicon Valley that makes people feel “culturally isolated,” said William Borghetti, Sendside CEO.
Tech companies are putting so much effort into hiring because it’s expensive for a small company to make a wrong hire at any level of the company, Borghetti said.
But talent isn’t the only challenge entrepreneurs face. Companies still struggle with capital, particularly when looking for mid-range investment. While good ideas will always attract capital, Borghetti said getting funding in the $3 million to $8 million range is extremely difficult.
Most people said the trouble hasn’t been caused by the economy though. However, Slovik said the recession has made people less willing to take risks, so it is largely very young people lacking experience who are starting companies.
“They don’t understand how the payables department at a Fortune 500 works and how to improve that,” he said. “… How about we find something with a real ROI that will be attractive to real companies?”
The Utah entrepreneurial community will have to overcome some of these challenges before they can really grow the way they want to.
The full story will be in November’s issue of Utah Business.