Crain's Cleveland Business

LOOK BACK | 1990S Gateway project and Rock Hall opening punctuated a decade filled with progress and optimism.

PAGE 19

CRAINSCLEVELAND.COM I MARCH 30, 2020

COPING WITH COVID-19

IN A CRISIS, THERE’S NO PLACE LIKE HOME

Pandemic forces many businesses and employees to embrace challenges of remote work

BY LYDIA COUTRÉ

NUTHAWUT SOMSUK/ISTOCK

Although video conferencing and virtual work technology have been advancing and becoming more popular for years, the COVID19 pandemic is throwing many businesses and employees into the deep end of remote work — and it’s sink or swim.

Organizations have been working toward remote work for the past 20 years to varying degrees of success, said Raymond Henry, associate dean for faculty affairs and chair of the department of information systems at Cleveland State University. According to the U.S. Bureau of Labor Statistics, a quarter of wage and salary workers work at home at least occasionally.

“But this complete virtual, what organizations have found is that they’re not really ready for that,” Henry said. “The tools have advanced but it really takes some adaptation and getting used to it.

Right now, I think organizations are really diving into the deep end out of necessity.”

See REMOTE on Page 18

FINANCE

STARTUPS

Private equity braces for economic impact

COVID-19 is unhealthy for Northeast Ohio startups

Funds have huge cash reserves, but challenges with deal flow are looming

BY JEREMY NOBILE

As the COVID-19 pandemic wreaks havoc on the economy and all businesses attempt to plot a course for survival — or, in some cases, growth — so, too, are private equity managers trying to gauge what the future holds for their portfolio companies.

Industry veterans like Stewart Kohl, co-founder of global private equity outfit The Riverside Co., who have worked through decades of economic turmoil, see this period as different from the others.

“What I think is unique about this one is it combines a massive health care crisis with a massive financial crisis that obviously directly stems from it,” Kohl Kohl said. “That combination is going to lead to this tremendous pause and reset that’s going to have a dramatic impact on revenues and activities for months. It’s a truly global phenomenon that cuts

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across every industry. That makes this unprecedented in my mind.”

What does that mean for fund managers?

“There is no question that right now the focus is on survival and liquidity,” Kohl said.

Private equity firms are dialing back their growth expectations for at least the next two quarters as the pandemic results in an economy shifting into low gear, which will eat into what had been market-beating returns for the PE sector as a whole.

See EQUITY on Page 17

Support groups offer help to entrepreneurs

BY JAY MILLER

While the coronavirus is most seriously imperiling the health of older people, on the business side, it may be more dangerous for the youngest of companies, those without assets or a loyal, long-standing customer base.

So it’s not surprising that entrepreneurial support organizations in Northeast Ohio are reacting to the crisis by keeping closer tabs on, and developing ways to sustain, the ar-

ea’s early-stage entrepreneurs.

During a webinar on March 24, the portfolio support committee of North Coast Ventures, a manager of investment funds that focuses on early-stage businesses, shared a survey taken earlier this month of its portfolio companies. The webinar assessed the state of its companies for its investor and included a plan to advise those companies.

See STARTUPS on Page 17

FOCUS | TECHNOLOGY Recruiting: Nexus Engineering reaches into local colleges and high schools for next hires. PAGE 10  Manufacturing: Cleveland CycleWerks hopes new e-motorcycle is an industry game-changer. PAGE 12

3/27/2020 4:44:27 PM

CONTENT

SPONSORED BY

NEWS AND TRENDS FROM NORTHEAST OHIO’S TECHNOLOGY SECTOR

TECH MATTERS TECHNOLOGY TAKES CENTER STAGE IN MASSIVE COVID-19 DISRUPTION OEC EXECUTIVE CITES IMPORTANCE OF REAL-TIME INTERACTION

H

igh-speed internet and cloud-based systems are the stars of the show when it comes to distributed workforces. Yet, teleconferencing and collaboration platforms play essential supporting roles in keeping employees engaged and productive outside of the office, according to Amy French, vice president of human resources at OEC. French, who is responsible for ensuring OEC’s global workforce thrives, shares insight into how the company is maintaining French operations even as many employees shelter safely at home.

PHOTO PROVIDED

Members of Akron-based Environmental Design Group use Microsoft Teams for morning meetups while the coronavirus pandemic keeps them at home.

I

t may be years before the economic impact of the coronavirus pandemic is truly understood.

In the midst of this unprecedented workplace disruption, it is clear, however, that technology has emerged as the lifeline enabling millions of homebound employees to stay connected and productive.

Deploying such an extensive remote workforce would not have been as “easy, efficient or secure” had the COVID-19 outbreak shuttered workplaces 10 years ago, according to David Howard, managing partner at Akron-based Keystone Technology Consultants.

Howard “Even five years ago, it would be a very different story,” said Howard, who admits he and his colleagues initially winced at the “massive wave of work” that would be required as their corporate clients transitioned employees into “home offices.”

“But it’s actually been a very cool thing to see unfold and not as difficult as we

A PRODUCT OF

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imagined,” he said.

Rob Falls, president and CEO of Falls Communications in Cleveland, credits technologies like Microsoft Teams, Zoom, Skype and FaceTime – along with “good old-fashioned email and the phone” – in connecting remote employees “with one another and with clients from wherever they are.”

Falls estimated 95% of his workforce is currently operating out of their homes.

Medical Mutual executive vice president and chief information officer John Kish said the company uses a VPN, or virtual private network, to help employees connect securely on corporate laptops from home and to “replicate the same experience they would have when they are in the office.”

“We also provide our employees with Microsoft Office 365, Skype and Teams for collaboration, chat, sharing presentations, and telephone conference calls,” he said.

Tammi Nagucki, director of marketing for Akron-based Environmental Design Group, stressed videoconferencing as a key to maintaining interpersonal connections, particu-

larly among teams who are accustomed to seeing each other daily. Nagucki said all but about six of EDG’s 80 employees are working from home, including her entire marketing department, which now meets virtually Nagucki on weekday mornings.

“I believe having that face time with people is one way to relieve some of the anxiety,” she said.

Technology also is supporting creative ways for storefront operators to interact remotely with customers. Catherine St. John, owner of Western Reserve School of Cooking in Hudson, piloted her first Facebook Live cooking event on March 18. More than 80 people tuned into the free tortilla-making tutorial. St. John is exploring the use of Zoom for future live demonstrations.

“We will charge for some of the longer ones once we determine the best platform to do that,” she said. “And, if the online classes are successful, I expect we would continue those even after this crisis is over as another way to engage with our customers.”

What are some of the key tools/ technologies teams need to succeed in a remote working environment?

In addition to the basics (laptop, internet), I think teams need tools that help them interact as they would if they were working in the office. Technologies like Skype and Microsoft Teams have video capabilities that allow you to see others virtually when meeting, which is extremely helpful.

Calendar tools that enable employees to share with others and the company intranet are also important communication tools for those working remotely.

How can managers sustain culture when employees are distributed?

I think the key is to encourage managers to interact regularly with their employees.

At OEC, we ask that our managers clearly communicate work expectations to help employees prioritize and stay focused, and that they continue to provide feedback and show appreciation. We also encourage employees to proactively reach out crossfunctionally and with their teammates. And some teams are having virtual lunches and happy hours to help stay connected!

From OEC’s own experience, what are some of the best practices that emerged as a result of managing a larger remote workforce?

■ Stay involved and communicate – don’t fall into the trap of ‘out of sight, out of mind.’

Hold daily informal updates and weekly video meetings

■

■ Maintain balance – take breaks and separate

work time from family time where possible.

This advertising-supported feature is produced by Crain’s Content Studio-Cleveland, the marketing storytelling arm of Crain’s Cleveland Business. The Crain’s Cleveland Business newsroom is not involved in creating Crain’s Content-Studio content.

3/25/20 2:04 PM PM 3/25/2020 2:23:43

REAL ESTATE

Topgolf scores with REIT

This is a view from a hitting room at Topgolf Cleveland on Rockside Woods Boulevard in Independence. The recently completed construction of the facility netted PGA-style money for its operators and developers. | BAXTER IMAGING LLC

Phoenix-based REIT paid almost $37 million for recently opened Independence venue BBY STAN BULLARD

A recorded phone message reports that Topgolf’s Independence location, like all of the company’s facilities across the U.S., is closed due to government mandates. The COVID19 shutdown wasn’t in the Dallas company’s plans.

However, the sale of the multilevel building with its 100 so-called hitting rooms for customers to play golf, drink or dine — weather be damned — fits the clockwork operation of the fast-growing company formally named Topgolf Entertainment Network.

On Feb. 24, just two months after it opened on Rockside Woods Boulevard, the bagger’s dream was sold to

or a developer putting it up for them.

A buyer such as VEREIT also gets favorable tax treatment under federal law designed to provide commercial real estate ownership to smaller investors.

VEREIT is a massive property company with a stable of 3,858 buildings ranging from corporate headquarters to Dollar General stores as of the end of 2019, according to the company’s most recent financial statement released Feb. 26.

Topgolf fits part of the company’s drive to diversify its retail tenant base with additional high-credit-rate, entertainment-oriented properties.

The Independence deal did not merit a mention on the company’s most recent conference call with investors.

However, the undisclosed number of Topgolf locations it owned as of the last year-end was just 0.7% of VEREIT’s holdings, according to its fourth-quarter 2019 investor review.

The Independence Topgolf, located at 5820 Rockside Woods Blvd., is one of 58 locations around the globe, according to a March 2 news release on the company’s website.

Topgolf teed off in 1997 and was originally distinguished by a technology that automatically scored games, which was embellished over time with a restaurant, bar, banquet rooms and other low-tech marketing mechanisms such as golf classes.

Plans for the project in Independence first surfaced in early 2018 before the suburb’s planning commission. Making the 15-acre site available for development and public use meant the completion of the extension of Rockside Woods between Rockside Road and Brecksville Road, which had languished for more than 20 years.

Topgolf did not reply by noon on Friday, March 27, to an email asking about the sale.

TOPGOLF FITS PART OF VEREIT’S DRIVE TO DIVERSIFY ITS RETAIL TENANT BASE WITH ADDITIONAL HIGH-CREDIT-RATE, ENTERTAINMENT-ORIENTED PROPERTIES. VEREIT, a Phoenix-based real estate investment trust, for almost $37 million, according to Cuyahoga County land records.

In a striking example of how property values are roughly the same for big companies in different locations, the Topgolf in Minneapolis sold for $38 million in 2018, while a Schaumberg, Ill., location sold in March 2019, four months after opening, for $50 million, according to The Real Deal, a real estate trade magazine.

As a just-completed construction project, Cuyahoga County has not yet assigned a market value to the structure for tax purposes, according to the county’s online property records.

Under a single-tenant, net-leased transaction, the property owner gets his or her cash immediately and the tenant leases the property for as much as 20 or 25 years. For a fast-moving outfit like Topgolf, such deals free up capital for investment in the next location by the company

Stan Bullard: sbullard@crain.com, (216) 771-5228, @CrainRltywriter

SPONSORED CONTENT

MILESTONES

Innovation, employee ownership all key to Garland’s 125-year history commercial waterproofing; residential construction; surface protection; and hard facing surfaces.

BY VINCE GUERRIERI Crain’s Content Studio-Cleveland

Garland president David Sokol says the key to the company’s success over the past 125 years has been its employees.

And, it’s not just modesty. Under an employee stock ownership plan, which has been in place since 1985, the company’s workers also are its owners, providing additional incentive for success.

“We have extra fuel in the tank because our employees have equity,” says Sokol, who’s been working with the company since 1990 and its president since 2004.

“They work harder and are more creative. Technology changes, but when your competitive advantage is your employees, you’re hard to beat in the marketplace.”

And the marketplace has listened.

Since the 1990s, Sokol says, annual revenue has gone from $30 million to nearly $900 million -- a far cry from the $100 that Jacob Wise borrowed in 1895 from his brother Sam to buy Garland Refining.

DeBacco said another key to the company’s success is its unique approach to sales.

greenhouses switched from glass to plastic, Garland’s offerings became outdated.

“The business was almost dead when we acquired it,” says Dick DeBacco, who with six other partners bought the company from the Wise family in 1974. “We acquired the company because they had mixers we could utilize to make roofing compounds.”

The commercial roofing industry was on the verge of change itself, switching from coatings to rubberized membranes, first in Europe and then in the United States.

“We short-circuited the sales process,” he says. “Our salesmen go directly to business owners. We provide more service than anyone else in the industry and control our products more than anybody else in the industry. We’re confident we provide the best possible roof, installed in the best possible way.”

DeBacco estimated there are over 220 sales representatives between the United States, Canada and the United Kingdom, with a total of roughly 1,300 employees. There are actually 20 companies under the Garland Industries umbrella.

In 1917, Wise received a patent for roofing composition, and two years later, the company moved its headquarters to East 91st Street in Cleveland’s Union-Miles neighborhood -- where it remains to this day.

“We invented roofs that were much more substantial and more cost-effective,” says DeBacco, who remains the company’s CEO emeritus. “It opened up a wider range of options for us. Before, we had coatings, which were just maintenance products. Membrane products brought us into the new roof and replacement roof markets, which were enormous.”

One early investment for the company was ImageWorks, a marketing company run by Sokol.

“We did the deal on a napkin, with no lawyers,” Sokol recalls.

Ultimately, Sokol was brought in-house in 1993, and has found the company a fertile ground for creativity and entrepreneurism. He hopes other companies will consider the idea of an ESOP, which might bring a smaller payday for owners, but remain more beneficial within the community.

The company initially distinguished itself with its line of products for greenhouses, largely paint and coatings. But as many

From there, the company has grown exponentially, while staying disciplined and not trying to extend much past its four main platforms:

“My shares are no different than anyone else’s,” he says. “I’m working side by side with other owners. It’s been a fun ride.”

This advertising-supported feature is produced by Crain’s Content Studio-Cleveland, the marketing storytelling arm of Crain’s Cleveland Business. The Crain’s Cleveland Business newsroom is not involved in creating Crain’s Content Studio content.

March 30, 30, 2020 2020 || CRAIN’S craIN’S CLEVELAND cLEVELaND BUSINESS BUSINESS || 3 3 March

REAL ESTATE

Commercial realty keeps up the pace COVID-19 crisis is contributing to ‘a big rush’ for warehouse space

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The wave of business shutdowns and social distancing that COVID-19 has wrought is having an impact on Northeast Ohio’s busiest commercial realty sector: the industrial market.

Initially at least, it’s bringing more medical, packaging and food businesses into the fray to seek additional warehouse space. They’re joining a market that’s already heated due to the push for more space to accommodate last-mile deliveries serving the rise of online shopping.

That’s the word from Terry Coyne, vice chairman of the industrial unit at Newmark Knight Frank’s Cleveland office.

“We got two new assignments this week,” Coyne said Thursday, March 26. He was handling about 2 million square feet of industrial real estate assignments earlier this month and expects half that amount of space to be leased by the end of March.

“I don’t know how long it will last,” Coyne said, “but I’ve had as many as four showings in a single day, and one at 7 p.m. There’s a big rush among clients to get warehouse space.” He and others declined to identify specifically who the big tenants are at this time.

Mac Biggar, president of Hanna Commercial Real Estate of Cleveland, said companies are continuing to request showings of industrial space.

“Some may use a disinfectant wipe to open a door, but they are out looking at property,” Biggar said, adding that Hanna’s David Stover recently had four industrial property showings in a single day.

Nathan Kelly, president and managing director of Cushman & Wakefield Cresco of Independence, said the brokerage has not seen a deal dropped, though it has seen some deals delayed.

Most, particularly in the industrial sector, continue working.

“The bigger the deal, the more momentum it has,” Kelly said. “Most of them are saying they are looking beyond the current COVID-19 downturn. And there will be a tomorrow.”

Kelly characterized the firm’s pace of transactions as normal.

Browning

Coyne

“There’s more hand-wringing, but decisions are still being made,” he said.

At CBRE’s Cleveland office, the industrial unit has not seen a negative impact, but the office sector has slowed and elements of the retail market have changed direction.

That’s particularly the case in the brokerage of space for food and beverage. Restaurant leasing had been strong, but the business is largely shut down as far as inside dining goes, said David Browning, managing director of CBRE’s Cleveland and Akron offices.

“As much as we want to say takeout and delivery is helpful for restaurants, it’s such a difference from their former operations you have to ask how much difference will that really make?”

Browning said. “And on the other side, it will take a lot of capital and expertise to reopen closed restaurants. It won’t happen overnight.”

After weathering six business downturns, three of them severe, Browning said he again finds himself listening to what he called “doomsday phone calls.”

While retail suffered during the Great Recession and then was challenged by online sales, Browning said it took years for the question of rent relief to surface. Now, thanks to dining room shutdowns, it has surfaced immediately.

Browning said his office had one major investment deal fail to close because the lender dropped the deal, but refused to provide specifics.

“We’re really in the pause stage,” Browning said. “A lot of people will have to look at their business and their clients and carefully decide how to proceed after this is over.”

One factor in maintaining the pace is the volume of activity on the commercial real estate side. At Colliers International’s Cleveland and Akron

office, Brian Hurtuk, an owner and managing principal, said the virus hit as the firm’s pipelines were full.

“About 70% of our business is leasing, and leases are still getting done,” he said.

“It’s so early into this quarantine that it is tough to see how it will work out.”

Hurtuk noted that commercial real estate is widely regarded as a relationship business. It’s an industry where personal contacts are key to the success of both individuals and firms.

“The technology has changed some of the face-to-face side of the business,” he said. “It allows us to remain in touch, whether by email or videoconferencing.

I would say that during the crisis people are more diligent about returning emails than in the recent past.”

This period of widespread enforced isolation may prompt some of the old culture of lunch meetings and coffee to regain favor afterward.

“When you sit and have coffee, you can almost expect something unexpected to come up in conversation,” Hurtuk said. “That doesn’t often happen on the phone.”

Every downturn is different and that shapes the recovery in different ways, Browning said.

“Much of what happens in the real estate business depends on other forces, such as city and county incentives, approval of a zoning matter or getting building permits,” he said.

“How reduced operations as governments do their own social distancing will have an unpredictable impact on how things happen going forward.”

While technology has helped keep things moving, Biggar said Ohio treating real estate as an essential industry has been helpful.

Kelly said the shutdown and working from home has already changed one of his theories about diminished demand for office space. Initially, he felt that as more businesses let people work on a mobile basis or from home it would further undercut the appetite for office space.

“After a week at home,” he quipped, “I’m confident it’s going to help demand for office space.”

Stan Bullard: sbullard@crain.com, (216) 771-5228, @CrainRltywriter

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4 | CRAIN’S CLEVELAND BUSINESS | MARCH 30, 2020

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3/27/2020 3:23:27 PM

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3/10/20 12:58 PM

PERSONAL VIEW

Zooming in on key conversation skills in pandemic

RICH WILLIAMS FOR CRAIN’S CLEVELAND BUSINESS

BBY RANDAL DOANE

EDITORIAL

What we’ve learned W

e’re only a little more than two weeks into the heart of a coronavirus crisis that is poised to last for quite some time, the president’s hopes for an Easter reopening notwithstanding. (We’d love to be wrong, but the health data suggest a widespread return to work by April 12 is extremely unlikely.)

It’s still hard to have much clarity about where we’re going, both on the public health front and in an economy that shed nearly 3.3 million jobs in a single week. It’s a cliché, but also entirely apt, to say we’re living in extraordinary times.

But in this confusion, some things strike us as being pretty clear. Among them: ``Health care workers in Northeast Ohio, and all across the country, are doing a remarkable job under the most difficult of circumstances. They’re working extraordinarily hard, and at a personal risk. Data last week from the Ohio Department of Health showed that as of last Thursday, March 26, 17% of all confirmed cases of COVID-19 in the state involve health care workers. Cleveland.com reported that in Cuyahoga County, that figure was even higher: IT’S A CLICHÉ, BUT ALSO 26%.

These medical profesENTIRELY APT, TO SAY sionals — doctors, nurses, home health care workers, WE’RE LIVING IN responders and EXTRAORDINARY TIMES. emergency more — are contending BUT IN THIS CONFUSION, with a new virus, one where there is no immunity. In SOME THINGS STRIKE US providing care to the comthey’re also facing AS BEING PRETTY CLEAR. munity, the challenge of protecting their families. On top of that, they’re working in an environment without enough testing kits, and with a patient load that may eventually overwhelm the system.

State government has acted admirably so far, and another example of that came last week, when Treasurer Robert Sprague launched a program that aims to provide added liquidity and ease the financial pressure hospitals are facing.

As Crain’s Lydia Coutre reported, the treasurer’s office, through the Variable Rate Demand Obligation (VRDO) Stabi-

lization Program, began buying eligible VRDOs of participating Ohio health care systems to alleviate debt service costs.

The program allows up to $900 million to be invested to stabilize hospitals’ short-term debt, allowing them to focus on caring for patients — exactly what’s needed right now. ``What some people have called “unskilled” labor sure became “essential” labor awfully fast.

Workers in grocery stores, drug stores and other needed retail work are serving key functions as the pandemic alters daily life. And yet, as we see from the anxiety about the economy, many people are worried about the state of their finances — particularly people who work in low-wage jobs.

When we see data about the large percentage of Americans who can’t afford to pay an emergency $400 bill, it should give us pause as we understand that many of them are now essential workers.

Ohio’s current minimum wage of $8.70 an hour ranks 28th among the states, and it’s below the average state minimum wage of $11.80 an hour. A group called Ohioans for Raising the Wage hopes to gather enough signatures to get on the fall ballot with a plan to increase the minimum wage to $9.60 an hour on Jan. 1, 2021, then boost it by 85 cents each year for four years to reach $13 an hour in 2025. The status of everything regarding elections is up in the air. But it’s certainly time to take seriously measures to make people less vulnerable to financial crises. ``The Senate’s quick work on a $2 trillion financial stimulus package, which was approved by the House on Friday, March 27, was the right thing to do. It’s not perfect, but measures including one-time cash assistance for most Americans and a significant expansion of unemployment insurance are important steps to prevent an economic calamity for millions of Americans that could threaten all parts of the economy.

This does, though, expose deep gaps in our system. While the stimulus may help mitigate some of the most severe economic consequences, many of the people who lost their jobs last week, and will in the weeks to come, do not have health insurance. That’s never ideal, and this is the worst time to be without it. Would Congress be up for work to fix this?

Publisher and Editor: Elizabeth McIntyre (emcintyre@crain.com) Managing Editor: Scott Suttell (ssuttell@crain.com) Contact Crain’s: 216-522-1383 Read Crain’s online: crainscleveland.com

The coronavirus pandemic poses formidable challenges to the things we take for granted. Whether it’s handshakes or supply chains, we have quickly discovered that things fall apart — sometimes rapidly, perhaps beyond repair. Through this state of uncertainty, one form of exchange will maintain its value: conversation. With social distancing in effect, the value of skilled conversation, for Doane is the vendors and clients, and between owner of friends, is likely to rise exponentially.

Cadence Dale Carnegie, of course, covers this Editorial ground with perfect clarity in “How to Services in Win Friends and Influence People.” His Oberlin. guidelines include: ``Be genuinely interested in other people. ``Smile. ``Remember that a person’s name is to that person the sweetest and most important sound in any language. ``Be a good listener. ``Talk in terms of the other person’s interest. ``Make the other person feel important — and do it sincerely.

But Carnegie, bless his heart, never had to contend with web 2.0, where the values above are often subverted. “The average person is distracted or interrupted every 40 seconds when working in front of their computer,” noted Chris Bailey in the THINK ABOUT YOU Harvard Business Review. “In other words, we can’t work for AND YOUR TEAM AT even a single minute before we WORK: WITH SOCIAL focus on something else.”

Think about you and your DISTANCING (OR team at work: with social dis- SHELTER IN PLACE) IN tancing (or shelter in place) in effect, what percentage of EFFECT, WHAT your daily face-to-face con- PERCENTAGE OF YOUR versations have you lost? 80%?

90%? More than 95%? Even as DAILY FACE-TO-FACE millions shift platforms from CONVERSATIONS in-person meetings to Zoom (or the equivalent), the rules HAVE YOU LOST? above still hold.

At work, follow Carnegie’s first rule, and take genuine interest in your neurodiverse colleagues — that is, the colleagues who have disclosed to you that they have a diagnosis of ADD, ADHD, etc., not the ones for whom you’ve established lay diagnoses. If you’re arranging a Zoom call with your team, consider the advice of Dr. Michael Seng, owner of A Starting Point: Psychiatry and Counseling, in Sheffield: “Engage these employees one-on-one, in advance, about the opportunity this meeting provides. Identify potential outcomes that will pique their interests.” During the meeting, too, engage them again. “Make note of their input in the meeting’s design,” Seng advised.

Peer-to-peer support also helps. The bigger the group on Zoom, the more likely your neurodiverse colleagues will struggle to focus. Consider whether a private message might be helpful, and send it to one individual only. For example: “Feeling distracted? Me, too. But don’t reply just yet.” In addition, make certain your camera angle points away from your keyboard, so you don’t offer evidence of your own waning focus. And smile for the camera: It’s safely infectious.

Write us: Crain’s welcomes responses from readers. Letters should be as brief as possible and may be edited. Send letters to Crain’s Cleveland Business, 700 West St. Clair Ave., Suite 310, Cleveland, OH 44113, or by emailing ClevEdit@crain.com. Please include your complete name and city from which you are writing, and a telephone number for fact-checking purposes.

See DOANE on Page 19

Sound off: Send a Personal View for the opinion page to emcintyre@crain.com. Please include a telephone number for verification purposes.

6 | CRAIN’S CLEVELAND BUSINESS | March 30, 2020

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3/27/2020 4:25:01 PM

OPINION

PERSONAL VIEW

What should investors do now that the bear market is back?

BY DAVID REYNOLDS

clients’ portfolios for roughly nine months and have recommended a tilt toward both large-cap and Stay disciplined and seek opportunities to upgrade high-quality stocks for several years. portfolios. Don’t succumb to panic.

These decisions have proven benefiAfter having avoided several near misses, U.S. equicial, and we continue to believe they ties recently fell into bear market territory for the first should be featured within an investime in more than 11 years, plunging a dizzying 32% tor’s portfolio. from record highs registered just one month ago and In addition, individual and instituending the longest bull market in history. tional investors who are willing to The “Coronavirus Crash” has been one of the swiftest Reynolds is a surrender a degree of transparency peak-to-trough market declines ever, and the hibernat- senior vice may benefit from owning hedge ing bear has come roaring back in a major way. In addi- president with funds in this environment. Unlike tion to materializing swiftly and suddenly, the bear mar- Key Private mutual funds, hedge funds’ net asset ket has been widespread, with nearly all asset classes Bank in values are not published in newspa(save cash) experiencing losses in the past few weeks. In Cleveland. pers or on the “crawl” at the bottom statistical terms, correlations among a variety of finanof a television screen. However, cial, asset prices have converged to approximately +1.0, representing perfect correlation. As a result, many in- hedge funds possess greater flexibility and have more tools at their disposal relative to their mutual fund peers. vestors are justifiably asking, “What should I do now?”

By forgoing a certain amount of transparency and by First and foremost, we strongly believe that investors should not panic and abandon their long-term plan. equipping skilled managers with greater resources, inNor should they eliminate equities from their portfolios vestors stand to benefit from less-volatile performance over time. We acknowledge that hedge funds are not apin a wholesale manner.

As the primary growth engine for most portfolios, eq- propriate for every investor. Further, not all hedge funds uities will benefit from future economic expansion once are created equal, thus placing a premium on selectivity, deep due diligence and ongoing monitoring. But a it re-emerges. thoughtfully curated collection of fundamentally oriented hedge FIRST AND FOREMOST, WE STRONGLY BELIEVE THAT fund strategies can offer benefits INVESTORS SHOULD NOT PANIC AND ABANDON THEIR to investors as well.

LONG-TERM PLAN. NOR SHOULD THEY ELIMINATE EQUITIES Investors can also seek unique returns from other FROM THEIR PORTFOLIOS IN A WHOLESALE MANNER. means. One such strategy seeks to capitalize on the volatility risk That said, it is also important that investors carefully premium (VRP). Designed to provide protection against evaluate the types of equities represented within their market volatility, this approach has proven to be benefiportfolios and consider making some minor tweaks cial over time. That’s because most investors overpay for protection, just as most people overpay for insurance during this time of extreme uncertainty.

While we reiterate our view not to sell equities indis- they never use (thankfully).

Understandably, bear markets trigger emotional recriminately, we urge investors to enhance an existing equity portfolio by adding high-quality companies and sponses in all of us. Fueled by an incessant cascade of pruning lower-quality companies. High-quality compa- negative events, recency bias can stoke fear and cause nies are those that exhibit above-average and relatively investors to extrapolate the present to the future, often enduring profit margins, possess lower levels of lever- leading them to overreact or freeze in place. In our view, age on their balance sheets, and are led by experienced, while it may still be premature to add aggressively to equities just yet, we think investors should assess the types proven and aligned allocators of capital.

Low-volatility stocks represent another category of of equities they own and consider upgrading their portequities that can provide some cushion during a bear folios during this time of immense uncertainty.

We also advise investors to be mindful of potential market. As their name suggests, these stocks are intriguing for their defensive asymmetric attributes: They par- opportunities to improve the diversification of their ticipate in up markets but decline less than broad mar- portfolios and help position them for the future. Sunniket averages in down markets when volatility typically er days will arrive, and we believe that investors who surges. Similarly, large-cap growth stocks tend to out- remain deliberate and disciplined, do not allow themperform their small-cap value counterparts during bear selves to be overtaken by panic and seek opportunities markets when, in general, earnings growth is scarce. We to upgrade and enhance their portfolios will be rewardhave emphasized minimum-volatility stocks within ed over time.

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WEB TALK Re: Film festival plans streaming feature CIFF Streams, coming in April, is a tremendous project from the Cleveland International Film Festival, and I think it might be a bellwether for how festivals will work in the future. Why limit the audience to those who go to a theater when many of us prefer staying home with great audio, video and comfort? — Alan Glazen

Re: Combating the coronavirus The March 23 letter to the editor from Corey L. Morrill had a great suggestion. Don’t shut society and the economy down. Just isolate the old people until it runs its course. Enough of this insane overreaction.

— Nicholas Stallard

Agree with Corey. Crushing the economy and people’s lives (with untold mental and physical health problems to come) so as to “flatten the curve” is a huge overreaction. ... History will judge this as being the example of the “cure being worse than the disease.”

— William Ross The myth is that COVID-19 is an “old person’s disease.”

That’s not quite true. According to the CDC, 38% of coronavirus hospital patients are under age 55. Hospital systems are approaching capacity. Physicians in Cleveland are facing shortages of masks, ventilators, gowns and other medical equipment. The goal of shutting down the economy is to avoid physicians having to choose who will receive treatment for COVID-19 and who won’t. ... Stay home. Help our medical community get through this huge challenge.

— Jason M. Sherman MARCH 30, 2020 | CRAIN’S CLEVELAND BUSINESS | 7

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Twinsburg company is moving into new building, plans to double meal production

BY JUDY STRINGER

Tom Lane’s business is school lunches.

That’s why Lane, owner of Innovation Foods in Twinsburg, finds it “frustrating” to watch nearby public school districts “kind of fumble,” he said, on figuring out how to feed students in need while they shelter at home.

“Honestly, my feeling is, ‘How about you just let us do this for you, because we can do it cheaper and easier than you can do it?’ I admire the spirit that a lot of them are showing in trying to get these programs up and running, but that is just not what they are built for,” Lane said. “But it is what we are built for.”

Innovation Foods normally makes and delivers roughly 7,000 breakfasts and lunches a day to schools and senior centers across Northeast Ohio, with a footprint spanning from Lorain to Youngstown and Cleveland to Canton. While Lane noted that the 7,000-meals-a-day figure — up from 3,500 in 2016 — is pre-coronavirus, he said growth on the senior center side of its operation and newer orders as a result of COVID-19-fueled emergency meal distribution sites are largely compensating for losses as some of his school clients discontinue meal service during closures.

Lane remains quite bullish on near-term prospects despite the interruption caused by the novel coronavirus.

“We are getting ready to double in size from this year to the next, going from producing 7,000 meals per day to about 14,000,” he said. “We just purchased a new building in Twinsburg Township, actually picking up the keys on (March 24), that will take us from 10,000 square feet to 31,000 square feet.”

Lane launched Innovation Foods in 2010. At the time, he owned Red’s Place, a Twinsburg catering business, 3/19/20 1:57 PM and New Adventures, a day care with sites in Twinsburg and Mantua. Red’s was already supplying meals to New Adventures when mounting interest from other child care centers persuaded Lane to transition from catering to school lunches.

In 2013, he moved Innovation Foods out of Red’s building on Darrow Road into a nearby 5,500-squarefoot industrial space on Midway Drive. Three years later, the company was producing 3,500 breakfasts and/ or lunches for more than 36 schools and community centers and adding on to its leased Midway facility.

The latest relocation, to a previously vacant building on Enterprise Parkway, will accommodate anticipated growth as Lane and his team are what he called “front-runners in a few contracts” currently held by an unnamed competitor that Innovation Foods has been successful at unseating in the past.

“They have a frozen-food model where they ship everything in frozen

from out of state,” he said. “We focus on local food and local preparation, so that typically we can do it at the same prices, but it will be an infinitely better quality product.”

Lane said Innovation Foods’ first public school pilot is another promising sign. School business to date has been with charter schools and day care facilities. Earlier this year, however, it began delivering meals to students in the East Cleveland City Schools.

He also notes growth among its senior program clients, like the community center in Bedford Heights, where the company drops off 100 meals a day.

Along with higher output, the Enterprise Drive plant will permit Innovation Foods to add in-house capabilities it previously lacked due to space. Chief among those are an apple-slicing and packaging line.

“We found over the years that kids will eat apple slices, like you get in Happy Meals or something, but if you hand them an apple, they won’t eat

“WE FOCUS ON LOCAL FOOD AND LOCAL PREPARATION, SO THAT TYPICALLY WE CAN DO IT AT THE SAME PRICES, BUT IT WILL BE AN INFINITELY BETTER QUALITY PRODUCT.” — Tom Lane, owner of Innovation Foods

it,” Lane said. “And for us, it will translate into our senior citizen program where some of our seniors don’t have the dentition to eat a regular apple.”

At the new facility, Lane added, the company will be able to bread its own chicken tenders from fresh chicken and make its own meatballs and hamburger patties out of fresh beef. All of that supports Innovation Foods’ mission to create minimally processed meals sourced primarily from local vendors such as Erie County’s Quarry Hill Orchards, Wayne County’s Gerber’s Poultry and pizza dough from Dough Go’s out of Canton.

“The only way to do that quality level of a product is to do it ourselves,” he said. “Otherwise, you are stuck buying in-processed product and there is nothing that sets us apart.”

Lane estimated his food business, which employs 65, hit $3.5 million in

8 | CRAIN’S CLEVELAND BUSINESS | MARCH 30, 2020

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Before the coronavirus crisis hit, Innovation Foods in Twinsburg, as seen in this 2016 photo, delivered roughly 7,000 breakfasts and lunches to schools and senior centers across Northeast Ohio. Still, the company is seeing a high demand for its orders. | PHOTOS

BY SHANE WYNN FOR CRAIN’S CLEVELAND BUSINESS

revenue in 2019, with year-over-year growth rates hovering between 20% and 30% in recent years. He still operates the two day care centers as well.

Those cleared about $2 million last year.

The day cares were running at about 30% capacity last week before the governor’s order went into effect that child care centers must be granted a temporary pandemic license to remain open. Lane said he has been able to utilize some New Adventures

personnel at Innovation Foods, making meals for emergency food distribution sites. The same day he talked with Crain’s, for example, Innovation Foods staffers were prepping and packing 13,500 turkey sandwiches for the Cleveland Metropolitan School District’s distribution effort.

“We also just set up a free meal program with Solon Senior Center, which was really on a tight budget. So we are basically doing it at cost,” Lane said.

The biggest challenge has been

getting the word out that his company is available as an emergency resource.

“We put a message on Facebook and our website landing page telling any program in need to give us a call.

We will help you find funding, work with you if you already have the funding, and if not, sell it to you at cost,” he said.

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RIDING INTO THE FUTURE

TECHNOLOGY

Cleveland CycleWerks launches a new e-motorcycle. PAGE 13

LURING TALENT WITH TECH Nexus Engineering reaches into local colleges, high schools for next hires BBY DOUGLAS J. GUTH

Cleveland-headquartered Nexus Engineering Group LLC went on a hiring spree in 2019, adding 55 new team members. Those included senior-level employees who bring both experience and a fresh perspective to the company, observed founding partner and president Jeff Herzog.

“You get used to baling wire and Band-Aids to help a business operate,” said Herzog. “We have a lot of really smart people and if you give them a mission, they’re going to deliver.

Every day we’ve got to figure out a way to get better or we’ll be left behind.”

IMAGEZOO VIA GETTY IMAGES

See NEXUS on Page 13

10 | CRAIN’S CLEVELAND BUSINESS | March 30, 2020

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3/26/2020 12:12:32 PM

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FOCUS | TECHNOLOGY

Cleveland CycleWerks launches new e-motorcycle The company plans to make its combination e-bicycle, e-moped and e-motorcycle in the U.S. BBY RACHEL ABBEY MCCAFFERTY

Simplified tooling means Cleveland CycleWerks’ new Falcon e-vehicle will be easily customizable, even after purchase. | EVAN PAINTER/CYCLEWERKS

The Falcon came to life in the company’s Cleveland workshop. | CLEVELAND CYCLEWERKS

The Falcon e-cycle was unveiled in a virtual event on March 20. | EVAN PAINTER/CYCLEWERKS

The addition of electric power enables Cleveland CycleWerks to bring all of its production for the Falcon onshore. | EVEN PAINTER/CYCLEWERKS

usage could toggle between the different settings, with CycleWerks changing the abilities remotely.

Colosimo thinks it will take a while for people to get used to what the company is selling, but he’s optimistic.

“It’s our chance to do a spaceship,” he said. “It’s our chance to really do something out there. And we’re not taking that lightly. We’re really trying to move the ball here.”

Brian Reese, managing director

“IT’S OUR CHANCE TO DO A SPACESHIP. IT’S OUR CHANCE TO REALLY DO SOMETHING OUT THERE. AND WE’RE NOT TAKING THAT LIGHTLY. WE’RE REALLY TRYING TO MOVE THE BALL HERE.” ——Scott Colosimo, CycleWerks CEO

of SureNova, doesn’t see much competition for Cleveland CycleWerks, a domestic company making affordable, small to midsized motorcycles.

Reese, who has a background in the motorcycle parts business, became a minority investor and a board adviser for CycleWerks last year. He said he was intrigued by Colosimo’s entrepreneurial nature and the company’s push into electric vehicles.

He’s bullish on the company’s prospects and thinks that, with investment support, it will succeed. “(Colosimo’s) a hustler,” Reese said. “He’ll find a way. He’s found a way to this point with literally nothing, no backing at all. He really understands the customer and the market, and he has the talent to create

the look so the product is right for the space.”

The company unveiled the Falcon in a virtual event on Friday, March 20, and pre-sales are open now.

Originally, the plan was for the event to be a public one at the Western Reserve Historical Society’s Crawford Auto-Aviation Museum, but it was moved online due to concerns around the spread of COVID19. CycleWerks is donating one of its gas-powered motorcycles, the Heist, to the museum.

“And that’s kind of putting a pin in gas for us,” Colosimo said. “That’s saying, ‘Hey, this is the history. This is the history of where we’ve been.’ ” Rachel Abbey McCafferty: (216) 771-5379, rmccafferty@crain.com

12 | CRAIN’S CLEVELAND BUSINESS | March 30, 2020

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BILLY DELFS

Scott Colosimo has long dreamed of making the motorcycles for his company, Cleveland CycleWerks, here in the U.S. Soon, he plans to make that dream a reality.

Cleveland CycleWerks is adding an electric option to its product lineup: a combination bike, moped and motorcycle called the Falcon. The plan calls for the company to make it using a supply chain of regional contract manufacturers and the latest technology.

CycleWerks got its start in 2009, making gas motorcycles. In 2019, Colosimo and his business partner parted ways, which caused the company to scale back, but also to refocus.

Cleveland CycleWerks currently has seven full-time employees. Revenue has traditionally been in the $2 million to $2.7 million range, Colosimo said. Today, Colosimo, the company’s CEO, is the majority owner of Cleveland CycleWerks, with a team of advisers holding a minority share.

Colosimo saw the restructuring as a good time to change what the company had been doing and make plans for the future.

Enter the plans for its electric vehicle platform.

The company’s electric offerings will be smaller volume than its gas motorcycles, Colosimo said. Some of the components for Cleveland CycleWerks’ motorcycles are already made in the U.S., he noted, but the majority of the work is done overseas. The company just hadn’t been able to bring whole vehicle manufacturing onshore, but the addition of electric made that a possibility.

Cleveland CycleWerks wants to offer an affordable electric option for consumers, with prices on the Falcon reaching a max of about $15,000. The company still plans to make its gas motorcycles, as well, and those motorcycles will continue to be made overseas, Colosimo said.

But for the electric production, CycleWerks has been working with some of its domestic suppliers to adapt the gas-vehicle parts they were making to electric ones, and the manufacturing process will use a mix of automation, 3D printing and handcrafted parts where needed throughout the domestic supply chain. All the assembly will happen at CycleWerks’ facility in Cleveland.

And Colosimo said a reduced, simplified approach to tooling means that CycleWerks will be able to release customized versions of the e-bike quickly. Additionally, the electric vehicle will be customizable even after a customer has taken it home.

“The paradigm shift between gas and electric is not one-for-one,” Colosimo said. “You know, gas, to go faster, you need a bigger motor.”

But with electric vehicles, that kind of change can be performed digitally.

And that’s just what CycleWerks plans to do.

The Falcon is an e-bicycle, an e-moped and an e-motorcycle, all in one, depending on how it’s programmed. Anyone wanting those higher functionalities would have to acquire the necessary license, registration and insurance. And customers with access to the higher levels of

NE

From

3/26/2020 12:13:57 PM

Pr

NEXUS

S.

From Page 10

Most of the hires joined Nexus in engineering and project management, enhancing the firm’s stance as a leader in the refining, petroleum midstream, chemical and utilities industries. The company also promoted 23 existing staff members across its offices in Cleveland, Maumee and the upper Midwest.

Among the fresh faces are four new department heads tasked with orchestrating critical company initiatives: Senior project director Don Newberry leads Nexus’ project services and finance groups; senior staff engineer Howard Thompson is responsible for enhancing the firm’s project health and safety services capabilities; director Dave Roland is extending a range of Nexus services to new refining and petroleum midstream clients; and discipline manager Bruce Knowlton leads an instrumentation and controls team in Maumee.

These seasoned professionals are prepared to continue a run of success that saw 19% annual revenue growth and more than $20 million in revenue in 2019. Armed with a client portfolio of major Midwest oil companies, Nexus is focused on maintaining existing relationships and expanding its offerings into the untapped petroleum midstream and energy service sectors.

“Seventy percent of our growth comes from relationships with existing customers,” noted Herzog, who founded Nexus with partner Marianne Corrao in 2005. “We like to brag that our first customer is still our customer today. We have long-standing relationships with customers that continue to grow and deepen.”

Nexus Engineering president Jeff Herzog says use innovative tech helps make a worplace attractive to new hires. | CONTRIBUTED PHOTO

Youth and experience As Nexus gained experience through its senior-level surge, the firm last year also stayed nimble by

time employees, continuing the company’s trend of promoting from within its 150-person staff.

“We’re at the size where we can bring in college graduates and young

to the team at Nexus.”

The engineering LLC is delving into the high school ranks as well.

Though action is still forthcoming, Nexus leaders are seeking a pipeline

“THE WAY TO GO IS TO GET YOUNG TALENT AND WORK ON THEIR TECHNICAL AND SOFT SKILLS,” SAID HERZOG. “CLIENTS WANT A PLEASANT WORK EXPERIENCE, AND WE’RE MAKING SURE WE’RE LISTENING AND RESPONDING TO THEM PROPERLY. WE HAVE TO GET WORD OUT THAT THIS A GREAT PLACE TO WORK.” — Jeff Herzog, Nexus founding partner and president

hiring seven interns from local and state colleges in Ohio. Herzog said he views this young talent as future full-

people, when as a startup we hired our friends,” Herzog said. “These are folks who will add to the culture and

of capable technical workers to train up on all-important people skills.

“The way to go is to get young tal-

ent and work on their technical and soft skills,” said Herzog. “Clients want a pleasant work experience, and we’re making sure we’re listening and responding to them properly. We have to get word out that this a great place to work.”

Pushing innovation is a potentially powerful way to build an attractive and exciting work culture, he added.

Laser scanning uses laser beams to map a client’s facility — similar to a camera taking a 360-degree photo, but with an accurate position for every pixel. Meanwhile, the company is harnessing technology like Microsoft’s HoloLens headset to animate construction designs in exquisite three-dimensional detail.

“Viewing models through these glasses gets us better input for our customers and quicker feedback on design,” said Herzog. “It’s a way to get designs optimized in operations, maintenance and construction, and lets our clients squeeze value from their investment.”

Like every industry right now, Nexus is adjusting its operations in response to the COVID-19 situation. In late March, the firm began remote work, keeping a skeleton staff in its offices to maintain onsite servers. Though most of Nexus’ work normally requires dealing with customers face to face, Herzog said the company will learn to deliver its services from a distance.

“This will force us to figure out where we need to improve our systems,” he said. “We want to keep bringing our product to clients who also may be struggling. We’ll be there as a trusted partner even if we’re working under unusual circumstances. We’re ready to get after it.”

Contact Douglas J. Guth: clbfreelancer@crain.com

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THE LIST

Software Developers Ranked by full-time local employees

LOCAL FULL-TIME EMPLOYEES TOTAL 1-1-2020

TOTAL 1-1-2019

CODERS 1-1-2020

INDUSTRY FOCUS

SOFTWARE PRODUCTS

MAIN LANGUAGES

TOP LOCAL EXECUTIVE

1

Hyland 28500 Clemens Road, Westlake 44145 440-788-4988/hyland.com

1,872

1,893

293

Health care, higher education, government, finance, insurance, manufacturing

OnBase enterprise content management software suite

C#, C++, C

Bill Priemer, president, CEO

2

MRI Software LLC 28925 Fountain Parkway, Solon 44139 800-321-8770/mrisoftware.com

450

421

157

Property management and accounting for the real estate industry

Residential Management, Commercial Management, Investment Solutions, Facilities Management

VB.NET, C#, Java

Patrick Ghilani, CEO John Ensign, president, chief legal officer

3

OverDrive Inc. One OverDrive Way, Garfield Heights 44125 216-573-6886/overdrive.com

329 (1)

297 (1)

88

Institutions (libraries, schools)

Libby, Sora, OverDrive

C#, ASP.net MVC / Web API, SQL Server

Steve Potash, founder, CEO

4

Foundation Software/Payroll4Construction.com 17800 Royalton Road, Strongsville 44136 800-246-0800/foundationsoft.com

294

227

57

Accounting software for the construction industry

Foundation, Foundation mobile, Foundation Service Dispatch mobile

PowerBuilder, Delphi, C#, JavaScript

Fred J. Ode, founder, chairman, CEO Mike C. Ode, president

5

OEConnection (dba OEC) 4205 Highlander Parkway, Richfield 44286 330-523-1800/oeconnection.com

276

255

63

OEM distribution networks, serving dealership and repair customers

D2DLink, CollisionLink, RepairLink, ConsumerLink, MyPriceLink, Performance Coaching, Athoris

.NET Framework

Charles Rotuno, chairman, CEO

6

Trimble Transportation 6085 Parkland Blvd., Mayfield Heights 44124 440-721-2020/transportation.trimble.com

252

252

55

Transportation logistics

TMWSuite, TruckMate, Innovative, TL2000, TMT Fleet Maintenance, TMT Service Center

C#, .NET Framework, Java

James Langley, senior vice president

7

BrandMuscle 1100 Superior Ave., Suite 500, Cleveland 44114 216-464-4342/brandmuscle.com

200

211

11

Local marketing

BrandMuscle Integrated Local Marketing Platform

C#, SQL, JavaScript

Mike Marchetti, executive vice president, Consumer Brands

8

MIM Software Inc. 25800 Science Park Drive, Suite 180, Beachwood 44122 216-455-0600/mimsoftware.com

143

132

30

Medical imaging

MIM, MIM Maestro, MIM Encore, MIM Symphony, MIMcloud

Java, Ruby on Rails, C++, MATLAB

Andrew Nelson, CEO

9

Patriot Software 4883 Dressler Road N.W., Suite 301, Canton 44718 877-968-7147/patriotsoftware.com

94

90

29

Small business

Payroll, Accounting, HR, Time & Attendance,

.NET/C# development

Michael J. Kappel, founder, CEO

10

Binary Defense 600 Alpha Parkway, Stow 44224 800-246-2792/binarydefense.com

86

66

18

Cybersecurity

Binary Defense Managed Detection and Response (MDR)

F#, Python, Go, JavaScript, C/C++

Mike Valentine, cofounder, CEO

11

1 EDI Source, a division of Epicor (2) 31875 Solon Road, Solon 44139 440-519-7800/1edisource.com

80

80

10

Electronic data interchange and managed solutions

HQXchange, EDI HeadQuarters, ManagedXchange, PartnerXchange, IntelligentXchange, AS2 Complete

C# using .NET Framework

Lance Hutt, senior director, general manager

12

New Innovations Inc. 3540 Forest Lake Drive, Uniontown 44685 330-899-9954/new-innov.com

79

69

19

Medical

Residency Management Suite, Undergraduate Management Suite

C#, Angular

Steve C. Reed, CEO

13

Keyfactor 6150 Oak Tree Blvd., Suite 200, Independence 44131 216-785-2990/keyfactor.com

68

68

20

Cybersecurity for health care, finance, retail, automotive

Keyfactor Command, Keyfactor Control, Keyfactor Code Assure

C#

Ted Shorter, chief technology officer, cofounder Kevin von Keyserling, chief strategy officer, cofounder

14

FeneTech Inc. 260 Campus Drive, Aurora 44202 330-995-2830/fenetech.com

67

60

26

ERP solutions

FeneVision, Q2S, FENml

.NET Framework

Ronald W. Crowl, president, CEO

15

HCL UrbanCode 1228 Euclid Ave., Cleveland 44115 330-554-2202/developer.ibm.com/urbancode

55

50

45

Software/technology

UrbanCode Deploy, UrbanCode Velocity

Java, JavaScript, node.js, mongoDB

Brian J. Muskoff, director, UrbanCode Product Development

16

7Signal Solutions Inc. 6155 Rockside Road, Independence 44131 216-777-2900/7signal.com

50

50

15

Wireless network monitoring

Sapphire Eye, Mobile Eye

Java, Javascript, C/ C++

Tom Barrett, CEO

16

BuyerQuest Inc. 343 W. Bagley Road, Suite 300, Berea 44017 866-937-0670/buyerquest.com

50

50

20

Corporate purchasing

BuyerQuest Procure-to-Pay, BuyerQuest eProcurement, BuyerQuest Marketplace

PHP, JavaScript, Java, SQL, CSS/SASS

Jack Mulloy, CEO

18

Tribute Inc. 1696-F Georgetown Road, Hudson 44236 330-656-3006/tribute.com

48

48

14

Distributors of fluid power and hose products

Tribute, TrulinX

.NET Framework

Timothy M. Reynolds, president, CEO

19

Pointe Blank Solutions Ltd. 30400 Detroit Road, Suite 400, Westlake 44145 440-243-5100/pointeblank.net

47

45

25

Government, health care, education

MatrixPointe Software, CasePointe, Koolu

C#

Thomas J. Coury, chairman, chief software architect

20

Banyan Technology 31011 Viking Parkway, Westlake 44145 844-462-2269/banyantechnology.com

46

55

18

Freight carrier connectivity software

Banyan API Hub, Intelligent Pricing, Insights

C#, MVC4/5, SQL, JavaScript, XML

Brian Smith, CEO Lance Healy, founder, chief innovation officer

20

Main Sequence Technology Inc. 4420 Sherwin Road, Hamilton Hall, Willoughby 44094 440-946-5214/pcrecruiter.net

46

47

11

HR applicant tracking, recruiting CRM, staffing software

PCRecruiter, PCRecruiter Job Board, PCRecruiter Outlook Portal, PCRecruiter Capture

Microsoft stack

Gretchen A. Kubicek, CFO Martin H. Snyder, president

22

Data-Basics Inc. 600 Broadway Ave., Bedford 44146 216-663-5600/databasics.com

44

43

21

HVAC, construction, field service and accounting

Sam Pro Enterprise, TechAnywhere for Android, DBAnalytics, CRMAnywhere, FMAnywhere

SmallTalk, Android, HTML, DBFrameWork, Azure

Arthur K. Divell Jr., CEO

23

FormFire LLC 1100 Superior Ave., Suite 1650, Cleveland 44114 216-357-7400/formfire.com

38

40

5

Health insurance

FormFire

.NET Framework

Colin Ingram, cofounder, CEO

24

Modern Hire 3201 Enterprise Parkway, Suite 410, Beachwood 44122 888-485-7633/modernhire.com

36

29

1

Technology, retail, financial services, health care, consumer

Modern Hire, Virtual Job Tryout

C#, react

Brian Stern, president Mike Hudy, chief science officer

24

Realeflow LLC 6659 Pearl Road, Suite 301, Parma Heights 44130 440-545-2095/realeflow.com

36

34

12

Real estate investing

Realeflow

C#

Greg Clement, owner, CEO

26

Dakota Software 1375 Euclid Ave., Suite 500, Cleveland 44115 216-765-7100/dakotasoft.com

35

39

8

Environmental, health and safety

ProActivity Suite - Profiler, Auditor, Tracer, Scout, Metrics

.NET Framework

Reg Shiverick, president

27

Proformex 1001 Lakeside Ave. E., Suite 1010, Cleveland 44114 866-998-8654/proformex.com

34

16

10

Life insurance

Proformex

C#, SQL, JavaScript

Kris Beck, CEO

RANK

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14 | CRAIN’S CLEVELAND BUSINESS | March 30, 2020

P014_CL_20200330.indd 14

3/26/2020 12:15:45 PM

COVID-19 | MANUFACTURING

Pandemic creates time of uncertainty, change for manufacturers

BY RACHEL ABBEY MCCAFFERTY

While Ohio’s stay-at-home order didn’t force many manufacturers to shut their doors, they’ve still had to adapt quickly to changes caused by the COVID-19 pandemic.

Some are finding ways to add production of necessary medical supplies to their workload; all are expected to implement safety and health precautions for their employees. And companies are bracing for the economic challenges to come.

Cleveland is a “supply chain town,” said Ken Patsey, president and executive director of Manufacturing Works in Cleveland. Manufacturers have a diverse range of customers, and many tier 2 or 3 suppliers may not even know where exactly their product ends up. Most can justify staying open, but may choose to pull back or close up shop if business was slowing anyway, Patsey said.

For companies that stay open, keeping facilities clean and employees safe is a top concern. Patsey said he’s heard of companies adding shifts or working on weekends to split up crews, and removing doors to minimize communal touchpoints.

At Habco Tool and Development Co. in Mentor, employees have been taking breaks every two hours to clean and disinfect the facility, said plant manager Chad Sanders. There are checklists for each department outlining exactly what needs to be sanitized.

Garrett Broters cleans printed personal protective equipment parts at MakerGear in Beachwood. | CONTRIBUTED

The company has also been taking workers’ temperatures at the door, posting best practices on bulletin boards and reminding employees to keep at least 6 feet between them at high-density areas like time clocks.

Precision CNC shop Habco, which has 43 employees, serves industries including aerospace and defense, which puts it into the category of an essential business. Sanders said it began these additional safety measures on Monday, March 16, which allowed it to get a little ahead of the rush on purchasing cleaning supplies and thermometers.

While COVID-19 hit fast, compa-

nies do have the opportunity to plan for the economic slowdown that is sure to come, said Ethan Karp, CEO of Magnet, the Manufacturing Advocacy and Growth Network in Cleveland. The shutdown of the big automakers will have an impact, even if it’s delayed.

Companies don’t always have the chance to plan ahead for such events, but they do in this case. Karp advised manufacturers to think about how to keep employees on staff, using furloughs or cutting back hours, instead of letting them go when demand drops. If the worst has to happen, treat employees with respect.

“When we get back, we are going to have the same talent shortages as we had three weeks ago,” Karp said.

“And if you were the ones who did all the right things through this time, you’re going to be the person who has the culture and the respect in the community to grow again. This is the time when people are tested.”

David Klotz, president of the Precision Metalforming Association in Independence, said he’s heard from some of the association’s member companies that they’ve had to lay off employees, but that they’ve continued to pay for those employees’ health care benefits. Companies want to be able to bring back those skilled workers when business picks back up, he noted.

As the pandemic spreads, groups like Magnet and the Alliance for

Working Together Foundation in Mentor have been working to connect manufacturers with resources, but also with opportunities to make goods that can support the fight against COVID-19.

“There’s been an overwhelming response from manufacturers who are like, ‘If I can help, please tell me,’ ” Karp said.

Fewer manufacturers have concrete ideas of how to make necessary personal protective equipment, he added, but they’re flexible. And since retooling takes time, they’re looking for workarounds.

Already, manufacturers have found ways to get involved. Distilleries like Gervasi Vineyard in Canton and Cleveland Whiskey in Cleveland have started making hand sanitizer; National Safety Apparel in Cleveland is working with U.S. Department of Health and Human Services-affiliated efforts to make masks and isolation gowns.

MakerGear LLC in Beachwood is 3D-printing parts for face shields, said founder and CEO Rick Pollack, and it’s looking for other ways to help. Typically, the company is a maker of 3D printers, and the printers it has onsite are used to make parts for its own machines, Pollack said. But now, those printers have been repurposed to try to meet outside needs.

Business is down for MakerGear, as the schools and companies to which it sells are essentially on hold.

MakerGear currently has 12 employees, and one individual has been placed on furlough, Pollack said.

The work it’s doing to help the medical community may keep it busy, but everything is still in flux.

The company is working to figure out the best way to help, and it’s not yet seeking compensation. For now, Pollack said, “We’re just donating materials and time to help stabilize the situation.”

Manufacturers need to be proactive and look for ways to contribute, said Steven Wengerd, sales manager for Pioneer Industrial Workflow Solutions in Dalton, Ohio, near Canton.

Pioneer is an Amish company that makes agricultural equipment and, through Pioneer IWS, products like weld tables and shelving to help manufacturers meet lean and 5S goals. Pioneer IWS has about 50 employees. Producing face masks wouldn’t fit the company’s skill set, but compact hospital beds that could be made at a high volume might be a fit, Wengerd said.

The company hasn’t begun turning out the products, but it has put engineering and brainstorming time into it. Pioneer has a proposal available for such beds if they’re needed.

“We can’t just wait until someone comes knocking on our door,” Wengerd said.

Rachel Abbey McCafferty: (216) 771-5379, rmccafferty@crain.com

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3/27/2020 3:26:01 PM

COVID-19 | COMMUNICATION

Accurate information is crucial during times of distress

Experts say organizations and governments should have clear, concise and empathetic message BBY KIM PALMER

Businesses have had to quickly pivot from marketing communications to crisis communications in response to the COVID-19 pandemic.

Companies can use the same traditional channels to connect with internal and external audiences, but crisis communication is a balance between what is required, what is helpful and what can be too much communication.

“My mailbox is filled with companies I’ve done business with and have never done business with, all telling me about how much they care about my business, how much they care about their employees and how clean their cars and counters are,” said Bruce Hennes, CEO of Cleveland’s Hennes Communications, which works exclusively in crisis communications. Most of the firm’s work centers around companies that need to get ahead of bad news.

Hennes cautioned that the way businesses normally communicate may not be effective during a crisis.

“People take in information differently, process information differently and act on information differently in a crisis,” he noted.

Although there is nothing untoward in companies reaching out to customers during times of crisis, the messaging should follow a simple template: Here is some information

Ohio Department of Health director Dr. Amy Acton, Gov. Mike DeWine and Lt. Gov. Jon Husted provide daily updates on the COVID-19 crisis. | OHIO CHANNEL

you may want to know, here is how you can get additional information and here is how you can give feedback and suggestions.

“Most companies should know that you should not brazenly pursue commercial business on the back of coronavirus,” Hennes said.

He added that it’s also important for organizations not to give in to the temptation to over-reassure when dealing with internal communications. It’s better to validate employees’ justified fears and provide guidance to them.

“We would much rather tell people

that things were better than expected, not worse than anticipated,” Hennes said.

Law firms are often tasked with providing critical guidance for clients during difficult times. John Swansinger, partner in charge of the Cleveland offices of Buckingham, Doolittle & Burroughs, stressed that messaging needs to be both precise and truthful.

“People are making vital decisions, and when things are not accurate it is misleading, and people do not forgive that easily,” he said.

Difficult messaging in chaotic times also needs to be empathetic,

concise and timely.

“The sooner you make a difficult communication, the better,” Swansinger said. “Don’t let people sit and wonder what is going on.”

He said it’s vital that a business reach out to clients and reassure them that a company is able to provide needed services — but be careful not to overdo that messaging.

“It is a fine line,” Swansinger said. “I have seen a lot of material out there about COVID-19 from the same source day after day after day. Customers want to hear you are in here, you are still in business, but make sure you are not offending by overselling your services.”

Information, even if critically important, can be overwhelming if you attempt to impart it all at once, but consistent communications can be very effective.

Daily pandemic-related press conferences featuring Gov. Mike DeWine and the Ohio Department of Health’s Dr. Amy Acton demonstrate that complex information can be communicated successfully if approached the right way.

Since the outbreak, Acton’s updates on COVID-19 case numbers and progression, taking place every day at the same time and using honesty and transparency, have reassured Ohioans.

“Like many people, I’ve built that into my day,” said Dr. Jane Timmons-Mitchell, clinical associate professor of psy-

chiatry at Case Western Reserve University’s School of Medicine.

Consistency is important and routine is reassuring, especially when other routines have been upended.

“Structure is one of the things that can help decrease fear and anxiety.

Even if it is not information we really want to hear,” she said.

Timmons-Mitchell, who also is a senior research associate at the Begun Center for Violence Prevention, Research and Education at CWRU’s Jack, Joseph and Morton Mandel School of Applied Social Sciences, said Acton’s degrees in medicine and public health help her messaging to be accurate and not overwhelming.

“She studies large-scale public-level trends and knows how to consume that research and communicate it effectively. She taught public health classes at OSU for years and she is teaching all of us now,” Timmons-Mitchell said. “She is able to take a very difficult concept and make it understandable.”

Acton is also able to combine competence and compassion when she speaks. Her tone is also important because it negates fear.

“She inspires us and she inspires thinking that everything is going to be OK,” Timmons-Mitchell said.

Kim Palmer: kpalmer@crain.com, (216) 771-5384, @kimfouroffive

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CLOSE DATE: April 17 | ISSUE DATE: May 18 16 | CRAIN’S CLEVELAND BUSINESS | March 30, 2020

P016_CL_20200330.indd 16

3/27/2020 3:41:10 PM

CRAIN’S CLEVELAND BUSINESS CRAIN’S CLEVELAND BUSINESS CRAIN’S CLEVELAND BUSINESS

COVID-19 | FROM PAGE 1

| | |

STARTUPS

From Page 1

Similarly, JumpStart Inc., the entrepreneurial support nonprofit, held a webinar March 26, “Leading Your Business Through an Economic Crisis,” that was attended by 350 business owners. It also has created a website for COVID-19 business resources.

And staff and mentors at BioEnterprise Corp., which supports young bioscience companies, are reaching out to the organization's portfolio companies.

Ed Buchholz, founder and managing director of StartInCLE, a grassroots organization working to advance the region’s startup culture, said in an email that he was hearing a lot of concern from these fragile companies.

“Most of the earliest-stage startup businesses are pulling from money raised to keep the doors open; the biggest challenge for them is that purchasing decisions are all on hold, so (there is) no new business,” he said. “The worst off are the founders who aren’t full time on their startup yet and who haven’t raised money.

Many work another job and/or do gig work to pay the bills, and a lot of that has dried up overnight. It puts their companies and livelihoods at risk.”

Jerry Frantz, chief investing and services officer at JumpStart, said in a phone interview that the organiza-

EQUITY

From Page 1

Playing defense is key today, said Steven Rosen, co-founder of Resilience Capital Partners. That means looking for cost savings, which may mean employee layoffs — though PE firms will want to avoid those as much as possible because of how that dings their reputations. Hiring freezes are par for the course, as are considerations for zero-based budgeting and cancellation of nonessential consulting engagements. The first line of attack is trimming costs. All fund managers are stress-testing their portfolios today and evaluating where tweaks can be made as they manage their investments.

How long the current pandemic-induced downturn lasts is anyone’s guess, and that uncertainty adds extra challenges for all businesses — something that trickles up to their backing investors. That makes defensive plays today all the more critical.

The pandemic’s effects will be mixed for businesses, but there will be winners, like those backing firms in the industries of mobile conferencing, medical supplies, B2B servicers and e-learning.

Resilience recently acquired the Northeast Ohio makers of MicroShield 360 disinfectant and will ramp up its production in a deal that looks very smart in its timeliness now, but which was in the works months ago and completed recently in light of product demand. It’s an example of being “more nimble than brilliant,” Rosen said. The firm also owns LUX Global Label of Philadelphia, a labeling and packaging business that has increased shifts.

Economically speaking, though, there will be losers. Right now, those are likely to be restaurant groups that have been forced to close until further notice, along with their suppliers and service providers.

Even businesses not as explicitly shut down are still being affected, though, such as Resilience-backed

P017_CL_20200330.indd 17

Entrepreneurs can find a compilation of resources at jumpstartinc.org/covid19. | JUMPSTARTINC.ORG

tion’s staff members, many with experience in young businesses, have been talking to the leaders of portfolio companies, taking their temperature and trying to be encouraging.

“Our initial messaging is first, as crazy as it is, just try to stay calm and take a deep breath and make sure first of all that they are first OK, that their families are OK, that their employees are OK,” he said. “It all starts with the people, and we’re trying to pursue a messaging that this is spinning up faster than anyone expected and working through this is going to take time, so be patient and thoughtful.”

Managing cash also is important, Frantz said, and the business leaders need to be thoughtful about what they can do with their businesses going forward. They also need to adjust to so many staff working remotely, even as they lose the value of the con-

versations that take place as people run into each other in the hallways.

“People are adjusting,” he said.

“I’m glad that computers are staying up and the internet isn’t crashing.”

North Coast Ventures, the former North Coast Angel Fund, which identifies promising early-stage software companies for its more than 250 investors, sent a nine-question survey to its portfolio of companies on March 19 to help it better understand how the companies were handling the crisis and how North Coast Ventures can best support them. It got 23 responses.

The survey found that most companies are forecasting revenue reductions and are coming up with contingency plans, with eight companies saying they already were taking measures to reduce costs. Three said they have a cash reserve to carry the com-

pany for 12 to 18 months (and are in frequent discussions with investors), while three companies mentioned downsizing or payroll cuts.

Twelve companies said they still had fundraising plans that were either ongoing or planned for the remainder of 2020 and into 2021.

It found that while the impact on customers and employees, as well as investors, was significant, there were some expressions of optimism. Software companies aren’t as tied to a place as many companies, so working remotely is less of hardship, the survey found. Also, the products created and sold by many of the portfolio companies are what is called “software as a service” — such as Salesforce — that is centrally hosted and modestly priced on a monthly or annual subscription basis, so the companies aren’t relying on a steady

LKD Aerospace of Washington, which has altered work shifts to decrease the amount of personnel working at one time to reduce potential spread of the coronavirus.

The duality of growth and struggles is present in any economic cycle, for any number of external factors. Picking the right companies and effectively enhancing their growth to capitalize on the financial upside is why private equity firms exist. It’s in downturns like this that fund managers really prove their worth.

While some factors are constant, the climate for the PE business is shifting.

Chris Jones, co-founder of Align Capital Partners, said that while some deals that were long in the works closed quickly this month, those that were still early in their vetting processes have stalled out as companies shut down, travel stopped and investment banks processed the shock.

Fundraising will likely slow down as well, though groups like Align Capital that recently closed funds — the firm closed its second fund at $450 million in February — are lucky to have finished when they did.

“The world has changed more in a short period of time than any of us has ever lived through before,” Jones said.

torney who often works on local transactions, said the deals he sees still are moving ahead, with neither banks nor private equity firms balking. Some banks are “aggressively trying to close deals as of now,” he said.

While that may be true in some deals that have long been in the works, overall deal flow is poised to take a dive, and financing could be a factor, particularly in the largest and most complex deals requiring multiple lenders.

“I don’t think you will see businesses being sold faster,” said Terrence Doyle, an attorney with Calfee who works on PE deals. “Struggling businesses will be difficult to sell, and investors will likely want to take a wait-and-see approach for their better-performing businesses in order to maximize value.”

In general, private equity funds are well-positioned to take on a recession. This is all the more meaningful as banks pull back on deal financing moving forward as they look inward to their companies and deploy capital to support borrowers as encouraged by federal regulators.

According to market research group PitchBook, at last measure in the second quarter of 2019, private debt funds were sitting on $241.4 billion in dry powder. That positions funds in general to invest through the downturn — something Kohl said Riverside will do, though likely with more focus on addons than new platforms.

The new climate may present opportunities to roll up competitors of portfolio companies, for example.

But even with large cash piles, financing is usually a common feature in any deal, and that’s already shutting down in many places.

“From an M&A perspective, the financing market is pretty much dried up,” Resilience Capital’s Rosen said.

“The credit window for financing buyouts is closed. How long it will be closed, that I can’t tell you.”

Today’s landscape is prime territory for turnaround investment firms. Riverside doesn’t explicitly do that but has a value-investing strategy that could see opportunity in this climate.

With a turnaround strategy in mind or not, some firms are prepared to buy regardless of the circumstances.

“We do have dry powder and we’d been waiting for some sort of correction in the marketplace, so we will continue to look for opportunities,” said Richard Hollington III, managing director and CEO of CapitalWorks, which focuses on investing for family wealth.

Hollington’s bankers tell him they’re ready to go with financing if he needs it, and he said his firm may hold some capital back just in case any of its portfolio companies need it. It’s a lousy market in which to raise outside capital anyway, and there’s no dire need for the firm to sell out anything in its portfolio.

In the long term, Manby predicted Northeast Ohio may benefit from its longstanding manufacturing sector — an industry that tends to be a major focus for Northeast Ohio private equity.

Challenge vs. opportunity Bill Manby, co-founder of venture capital firm Akron Fusion Ventures, pointed out that the general decline in valuations today presents both opportunity for buyers — coming out of a period with record-high company multiples — and cause to pause for potential sellers. Those situations, and multiples, will vary greatly from one company to the next.

“Investments that offer services or products/solutions to aid in the pandemic are of heightened interest,” he said. “Some exit strategies will be delayed and others are accelerating, especially startups that provide solutions or technology in an area now thrust into a high level of focus.”

Mark Krohn, an Akron business at-

S E P T E M B E R 3 - 9 , 2 018 S E P T E M B E R 3 - 9 , 2 018 S E P T E M B E R 3 - 9 , 2 018

| | |

PA G E 17 PA G E 17 PA G E 17

flow of new orders to sustain them.

Most of the CEOs, 82.6% of them, also said their roles in their companies were changing. They were recognizing that they needed to be the center of stability within their organization, spending more time in department meetings, focusing on internal process improvements and even doing mental health checks on employees.

One sector of young companies may be doing better than most others. Not surprisingly during a medical crisis, it’s the bioscience companies that BioEnterprise nurtures. This group includes companies that provide online health communications, those that assist with hospital staffing and scheduling, and companies that develop drug therapies.

“What I’m hearing is last week was tough, a lot of people who were seeking funding, their phone calls weren’t getting picked up,” said Matt McBride, vice president for strategic partnerships of BioEnterprise in a phone call on Tuesday, March 24.

“This week, especially with the announcement of a stimulus package, people are getting picked up on again. Most of the companies that I’ve talked to, they aren’t in need of anything outside of the ordinary, except maybe a babysitter.”

Jay Miller: jmiller@crain.com, (216) 771-5362, @millerjh “When the dust settles, the supply chain will likely shift and benefit areas like Northeast Ohio and other places with a strong manufacturing, health care and consumer product ecosystem,” Manby said. “We are also more likely to recover quickly than highly populated and expensive areas.”

Ultimately, everything in the PE business will be tied to the economy, and how the economy fares through the pandemic will be influenced heavily by Capitol Hill.

“I have faith in Washington that if everyone takes this seriously, we get testing organized, the government takes care of small businesses and doesn’t play politics, we will get through this,” Rosen said.

Jeremy Nobile: jnobile@crain.com, (216) 771-5362, @JeremyNobile Crain’s Akron Business reporter Dan Shingler contributed to this article.

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3/27/2020 4:53:47 PM

COVID-19 | FROM PAGE 1

REMOTE

From Page 1

In an ideal world, individuals and employers would have been able to properly prepare for a massive shift to virtual work. But in this case, many are scrambling because they didn’t have structured processes and procedures in place for working remotely, said Erin Makarius, associate professor of management at the University of Akron, who has been researching virtual work for more than five years.

Building and maintaining trust through active communication and feedback in a virtual work environment is really important and can also be difficult when people aren’t talking face-to-face as much, Makarius said. Establishing guidelines and expectations around communication is also key, such as simply noting that you need a reply within a certain time frame or letting someone know you’re thinking about what they sent and will get back with an answer.

A lot of these adjustments are happening in real time, said Michael Goldberg, executive director of the Veale Institute for Entrepreneurship at Case Western Reserve University and an associate professor of design innovation at the Weatherhead School of Management at Case.

“I think I’m seeing folks sort of making the transition, and I think the way that we use these platforms and tools keeps evolving based on our experience every day,” he said.

Tips for remote work 1. Recognize that virtual work is not the same as working in the office. Understand that there may be hiccups, including technical issues.

2. On that note, test the technology ahead of time: Does the microphone work? How about the camera? Is your home internet able to seamlessly handle your work meeting while your kids are gaming, streaming or taking online classes?

Finding the right tools When looking at remote working tools, businesses will have to consider communication tools, like the video conferencing and teleconferencing services, which many vendors are offering expanded access to through discounted or free trials or other upgrades in response to the pandemic.

Collaboration tools that allow employees to share documents and collaborate on projects are also key to remote work, Henry said. Collaboration tools are often already in place in offices, which typically have some level of virtual work. Some tools are synchronous, in which two employees work at the same time on a project, while others are asynchronous.

“And both of them are useful, and important, and it’s just figuring out what works for the particular situation,” Henry said. “So much of this is context dependent.”

Makarius also noted that managing the technology to the task in virtual work is important. A quick question can be relayed via text or chat, but a discussion or a decision that needs to be made might require a video or phone call to have more immediate back and forth interaction.

“I don’t think that there’s one tool that’s the be all, end all for virtual work, and I think it really depends on the company and the job itself,” Makarius said.

The conferencing tools and remote work software tend to be pretty “robust” in their ability to handle the large increase in workers using them, Henry said. Technical problems are more likely to arise on a case-by-case basis depending on an employee’s internet speed or network connection.

For families who now have children at home taking online classes, streaming videos or gaming, they might have to set some boundaries to ensure their network can handle everyone’s activities.

NUTHAWUT SOMSUK/ISTOCK

3. Provide as much material as possible before the meeting. Email everyone the necessary documents ahead of time, so everyone can be prepared and no one is waiting for that message to come through.

4. Have and abide by an agenda.

Goldberg

Makarius

“It is interesting because I think many of us who aren’t used to kind of like working from home probably hadn’t battle tested our home networks,” Goldberg said. “Before you’ve got your important work call or before your kids are going online for

5. Make sure participants in a virtual meeting have equal chances to speak to ensure someone’s voice isn’t lost.

6. Remain flexible. Though many organizations have been working to have this infrastructure available and the tools in place, they’re now testing the technology and processes in real time on a large scale. Recognize that this will take some adjustment.

7. There are also the common sense notes: Dress professionally for video calls; find the quietest space possible; if you’re using your phone, place it in a stand or stabilize it for steady video; mute your audio when you’re not talking; be aware of what’s in the background of your shot; remember that in many videoconferencing services, muting audio and pausing video are two separate actions.

their classes, test everything. Test the microphone, test the video camera, test the connectivity before you really need it.”

Jim Hornyak started J.W. Hornyak Videoconferencing and Telecommunications in 2001. The Independence company is a vendor for Zoom, a video conferencing tool, and supports its clients with equipment for conference rooms.

As the pandemic has relocated workers to their homes, Hornyak said he’s seen an increase in requests from existing clients adding subscriptions and equipment or seeking more licenses.

“I think what this crisis is going to

do, my theory is going forward, people are going to go, ‘Gee, it wasn’t bad meeting virtually. I kind of like this,’ ” he said. “And now they’re going to start thinking, ‘Maybe I should make more sales calls on it.’ ”

A culture of grace Makarius encourages companies to promote respectful engagement during this time of uncertainty in the world.

“Maybe don’t expect the same levels of engagement as before,” she said.

Employees are juggling a lot: Adjusting to a new remote work enviRaymond Henry, associate dean for faculty affairs and chair of the department of information systems at Cleveland State University, said many organizations weren’t prepared for working virtually when the COVID-19 crisis hit.

“The tools have advanced, but it really takes some adaptation and getting used to it,” Henry said. | B. THOMAS HART PHOTOGRAPHY

ronment and new ways of communicating as they manage distractions at home, such as figuring out how to homeschool their children or care for elderly family members — all while dealing with the emotional and cognitive distraction of understanding the pandemic and everything happening in the world.

“I think it’s important to remember when we think about expectations that this is not business as usual,” Makarius said. “We really have to be realistic and build grace into the culture, trying to understand the big situation everyone’s facing and provide support however possible.”

Before a meeting or class starts, there’s often idle chitchat as co-workers and students ask about each other’s weekends or plans for that evening. Goldberg said he’s trying to maintain that space by making himself available before and after his classes for students who have questions or just want to talk. He recommends businesses create that same opportunity for informal conversation.

From running into a colleague in the hallway to the infamous water cooler talk, working from home eliminates these spontaneous interactions.

“And not only do these informal discussions help build relationships, but they also tend to spurn ideas, enhance creativity and to really improve collaboration, so they can be vital for performance in the workplace as well,” Makarius said.

Companies can provide opportunities to maintain those relationships through virtual coffee chats, an open channel to discuss what people are working on or dealing with at home, a virtual pizza party or delivering care packages to employees, she said.

Work-life balance The promise of remote work has always been flexibility, Henry said.

Work doesn’t have to always mean arriving at 8 a.m. and leaving at 5 p.m. Working virtually gives some power back to individual workers to, for example, take a couple of hours in the day to care for their children, and make that time up in the evenings.

But that can create discord between schedules.

“The flexibility is I can take two hours to take care of my kid who’s home as well,” Henry said. “Well, if somebody says that two hours isn’t my two hours, so I need you to answer this question now, that creates potential conflict.”

The flexibility of virtual meetings also means that they can happen at any time and risk encroaching on other parts of life. When employees aren’t driving to and from the office, they risk losing that separation of work time and home/family time.

They start to co-mingle. It’s critical that employees set and communicate clear expectations.

“It feels like we’ve got a big chunk of time ahead here,” Goldberg said. “I think that the habits that we put in place now with our colleagues, with our employees, with our people we work for, with our families, we really need to be mindful of, this could be a while. You’ve gotta work with these people and live with these people going forward, so how do you do it? How do you put in place good practices that allow you to get your work done and sort of maintain work-life balance?”

Lydia Coutré: lcoutre@crain.com, (216) 771-5228, @LydiaCoutre

18 | CRAIN’S CLEVELAND BUSINESS | MARCH 30, 2020

P018_CL_20200330.indd 18

3/27/2020 5:11:19 PM

CRAIN’S CLEVELAND LOOK BACK | 1990S

A decade that shows Cleveland knows how to rock and roll with the times On a beautiful, sun-soaked summer weekend in July 1996, more than 1 million people gathered downtown to celebrate Cleveland’s bicentennial.

Bridges spanning the Cuyahoga River were aglow in red, blue, purple and green hues for the birthday bash. Lasers and fireworks lit the night skies, a parade kicked off and the Cleveland Orchestra performed. It seemed a fitting celebration for a decade filled with progress and optimism as Cleveland gained national attention as a comeback city. But was it? And would it last? Only time would tell. — Elizabeth McIntyre

``IN THEIR OWN WORDS

“We did it!

We did it!

Tell the world we did it!”

——Cleveland Mayor Michael R. White, during the ribboncutting ceremony at the Rock & Roll Hall of Fame in 1995

``THE HISTORY The decade kicks off with Michael White’s inauguration as Cleveland’s 55th mayor. White will lead Cleveland for three terms and leave an indelible mark on projects large and small in the city.

His first major win is the push for a sin tax on alcohol and tobacco to fund the planned Gateway arena/ballpark complex, which ekes out a narrow win at the ballot box in May 1990.

Four years later, the Cleveland Indians open their new ballpark, Jacobs Field. In October that year, the Cavaliers officially relocate downtown with the opening of Gund Arena, the final piece of the $425 million Gateway project.

The mid-1990s are a golden era, with the Indians making their first World Series ap-

President Bill Clinton throws out the first pitch prior to the Indians’ Opening Day game at Jacobs Field in 1994. | DIAMOND IMAGES

pearance in 41 years in 1995, and returning to the Fall Classic two years later, dropping Game 7 in extra innings. In September 1995, more than 10,000 flock to North Coast Harbor for the dedication of the Rock & Roll Hall of Fame and Museum. Bruce Springsteen and Chuck Berry kick off a celebratory concert the next night at Cleveland Municipal Stadium.

Months later, the party ends when Cleveland Browns owner Art Modell announces he is moving the team to Baltimore. White leads a nationwide campaign to stop the move, which fails, but succeeds in landing an NFL franchise that will carry the Browns’ colors, name and records.

The Browns return in 1999, but fans at new Cleveland Browns Stadium find little to cheer as the team posts a 2-14 record in its first season.

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“There isn’t enough federal money to rebuild the cities. It takes efforts like this one to bring in jobs and housing.”

——President Bill Clinton, after throwing out the ceremonial first pitch at Jacobs Field on Opening Day in 1994

CUSTOMER SERVICE

“I can never forget Since it opened in 1995, the Rock & Roll Hall of Fame has become an icon of Cleveland to people worldwide. | TIM HARRISON FOR CRAIN’S the kindness of the people of and the loss of manufacturing jobs. By current downtown residential boom ``WHY IT MATTERS TODAY the late 1990s, Cleveland had gone from would be far less likely without these Cleveland, the fans assets.

The seeds of Cleveland’s comeback 12 Fortune 500 headquarters to seven. that supported the planted in the 1980s took root in the There was a sense of déjà vu in 2016, The way leaders came together to when the media descended on Clevekeep an NFL team here was employed early ’90s and fully blossomed by Browns for years. mid-decade with the opening of Jacobs land for the Republican National Con- again in convincing the RNC to arrive But frankly it came Field, Gund Arena, the Rock Hall and vention and touted the city’s renewal: a and, this year, in enticing Sherwin-Wilthe Great Lakes Science Center. growing downtown residential popula- liams to stay. down to a single Media outlets hailed Cleveland as tion, a new convention center and hoThat kind of collaboration is vital to the city’s success. And if it can be harproposition: I had “America’s Comeback City” and held it tels, and a Public Square makeover. up as a beacon of hope for other ailing The 1990s show Cleveland’s resolve nessed in this decade to address the no choice.” industrial cities. Civic pride was in and resilience. What was built then — problems we continue to face — popu——Cleveland Browns owner Art Modell in 1997

crainscleveland.com

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abundance, but challenges remained.

Northeast Ohio still struggled with poverty, population decline, urban sprawl

DOANE

From Page 6

At home, too, abide by Carnegie’s edicts. Make sure you’re the friend that “make(s) that other person feel important.” Social distancing opens more opportunities for friends, family and neighbors to pick up the phone and call (even without an appointment). Many of us are out of practice in this regard. At home, too, we are rarely outside the gravitational pull of Facebook. Its power is no

the physical structures and the partnerships that pushed for progress — continues to define downtown today. The

accident. Mark Zuckerberg and company posed the following question to their user experience designers: “‘How (can) we consume as much of your time and conscious attention as possible?” said Sean Parker, founding president of Facebook.

This past weekend, I organized a Zoom cocktail hour with four old friends, fellow GenXers, all facing variations on the theme of biggest life challenge yet — just like you, I figure. After 40 minutes, Zoom dispatched us without warning, so I

lation loss and poverty chief among them — the 2020s will be a historic decade.

called my friend Brian to extend the conversation. After the call, I checked my phone, naturally. Brian and our friends had exchanged a number of messages — while Brian and I were talking. I was oblivious, and gladly so, for I simply can’t text and talk responsibly at the same time. Still, I believed I had Brian’s full attention. Clearly, that wasn’t the case.

Brian is one of my dearest friends and, after some pointed encouragement from my wife, I was happy to extend him the benefit of the doubt.

Today, especially, it’s time to play the long game. Each of us is bound to respond differently to the duress of these difficult times.

For the next round of calls from friends or family, I plan to head upstairs, grab a seat on the couch, take a deep breath and listen. Really listen. “Three-fourths of the people you will meet are hungering for sympathy,” Carnegie noted. “Give it to them and they will love you.”

A good reminder for these times: Offer love in the time of the coronavirus pandemic.

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March 30, 2020 | CRAIN’S CLEVELAND BUSINESS | 19

P019_CL_20200330.indd 19

3/27/2020 4:37:49 PM

THANK YOU T

o everyone at the frontlines of the pandemic, from health care employees to food services, words cannot begin to express our gratitude.

You selflessly take care of others, putting their needs ahead of your own. In times like these, your strength and resiliency are an inspiration to all.