Silver lining in 'the cloud'

Article by: TODD NELSON , Special to the Star Tribune
Updated: September 23, 2012 - 8:18 PM

Tech Outfit has grown with the popularity of new computing services.

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Donovan Niesen, founder/owner of Tech Outfit in his Minneapolis, MN office on September 18, 2012.

Photo: Joel Koyama, Star Tribune

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For many companies, "the cloud" has been heaven-sent.

Cloud-based e-mail and other computing services became a cost-saving refuge for companies hard hit by the recession. And stronger companies turned to cloud-based services and technology upgrades to be ready for the upswing.

As a result, Donovan Niesen, founder of Tech Outfit, is seeing his business take off as the Minneapolis-based technology consulting services company helps small- and medium-sized companies move to the cloud.

He expects revenue, which has grown 20 percent a year in each of the past two years, to continue to increase at that pace for the foreseeable future. The company, which has two full-time employees and two contractors and had 2011 revenue of $250,000, likely will double in size over the next year or two, Niesen said.

That growth stems largely from increasing demand from businesses for cloud-based services. Businesses now account for 80 percent of Tech Outfit's customers and have rapidly transformed a company that started out as a would-be Geek Squad competitor originally focused on doing in-home repairs and consulting for residential customers.

Today, customers range from mid-sized companies such as Ed Hoy's International, a wholesale art glass and supplies distributor near Chicago, and Federal Foam Technologies, a foam and plastic materials fabricator and processor with offices in Wisconsin and Minnesota, to smaller ones such as Alta Contractors, a commercial construction firm in Edina.

Tech Outfit, Niesen said, aims to occupy what he sees as a promising niche between low-priced, small repair services with one or two technicians and more expensive consulting firms with a staff of 50 or more.

The company still does computer repairs on site and in its shop. But the focus today is on helping companies with choosing and migrating to cloud-based services, building wireless networks, setting up remote access for employees working outside the office, providing security, backup and data recovery solutions and, increasingly, performing proactive services that can help avert or minimize system meltdowns.

"We're focused on making sure we're keeping our clients happy so they would advertise for us," Niesen said.

To that end, when customers call Tech Outfit, they get Niesen, an employee or an answering service, not voice-mail. Turnaround time on repairs done in the company's shop is usually one or two days. And Niesen only hires technicians who have customer service experience and who can explain technical issues to customers in plain English, not "geek speak."

"We wanted to define ourselves right away that we will be there tomorrow, we'll be there next year, we'll be able to respond quickly and clients will know what's going on," Niesen said.

Tech in his DNA

Niesen, 30, has been developing his customer service skills and technical savvy for more than half his life. Growing up in an entrepreneurial and technically inclined family in the Madison, Wis., area, he was just 12 when he launched his own bulletin-board system, using his allowance to buy his own phone line so people could get dial-in access to what was at that time a popular form of online community.

At 14, he began doing technical support for a Internet service provider outside of Madison.

"We were literally walking people in rural Wisconsin through setting up their dial-up Internet connections," Niesen said. "You had to be an extremely effective communicator to get that done over the phone. You had to really learn how not to overuse jargon and not talk down and be very patient."

He gained further customer experience working in a call center in the Twin Cities. After hours, he and a friend he worked with fixed computers. While their visions of becoming Internet entrepreneurs didn't materialize, their computer repair work led them to start Tech Outfit in 2005. Niesen bought out his co-founder in 2007.

Tyler Lachaussie, network administrator at Federal Foam Technologies, said Niesen has helped roll out new wireless networks for internal staff and guests while supplementing the information technology department during an employee transition.

"He's really knowledgeable about enterprise-level technology," Lachaussie said. "He's been able to explain things like that to me here, very clearly. He always responds as quickly as possible to an e-mail or a phone message. He's our on-call tech for us."

The expert says: Dileep Rao, president of InterFinance Corp. in Golden Valley and clinical professor of entrepreneurship at Florida International University, said Niesen's life offers a number of lessons for entrepreneurs, including getting an early start, entering the industry where you have passion and where you can be better than anyone else and where you can ride trends to growth.

"He has learned how to sell, how to sell value and then how to be capital-efficient to do more with less," said Rao, an author on business development, growth and finance and developer of uEntrepreneurs.com.

Niesen's ability to be nimble and adjust also demonstrates a quality entrepreneurs often need to survive, Rao said. Targeting a customer segment where he has an advantage and to offer the kind and quality of services they want also is to his credit.

"What he needs to make sure of is to understand how to keep these high standards when the company gets bigger and he is not able to look over each employee's shoulder," Rao said. "This involves hiring right, training right, monitoring right and motivating right. And he needs to learn how to do all of this with cost and overhead control so he can dominate his niche."

Todd Nelson is a freelance writer in Woodbury. His e-mail address is todd_nelson@mac.com.

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