Edina firm's software has corrections connections

The key to a successful start-up, we're told, is a solid business plan and enough capital to make it work.

A healthy dose of serendipity -- dare we say dumb luck? -- doesn't hurt, either.

Which brings us to Tim Skaja and Tim Eickhoff, founders of Renovo Software, an Edina company they launched late in 2003 to market software that schedules, automates and manages videoconferencing systems.

Their initial focus was the crowded education market, which yielded an acceptable, albeit unspectacular, sales run to $2 million in 2007.

Whereupon the aforementioned stroke of luck intruded, introducing Renovo to an unconventional and fast-growing market that more than doubled 2008 sales to $5 million.

The market: corrections departments.

Yup, jailers nationwide are tumbling to the notion that inmate visitations are safer, less expensive and more convenient for the public when inmates remain in the cell block and use videoconferencing systems to chat with visitors who are at video stations on the outside.

It took Renovo nine months to customize its software for the Orange County client and three years to redesign the product to meet the unique requirements of the market and make it compatible with every brand of equipment. The need to establish relationships with hardware manufacturers and fight through the red tape of the corrections systems also prolonged development.

But the payoff was dramatic when Renovo introduced its new product in 2008: Sales into the education market grew 30 percent last year, to $2.6 million. But the new entry almost matched that total in its first year, grossing $2.4 million.

With education clients tightening their fiscal belts, Skaja and Eickhoff expect sales to that market to be flat this year. But based on orders on the table or in negotiation, they expect corrections sales to nearly double this year, taking Renovo sales to more than $7 million.

There are several reasons why corrections departments are shelling out about $5,000 per videoconferencing station for systems that can include scores of stations.

Video is safer, smarter

"And for corrections officers, it provides better safety," Edmondson said, because they no longer must escort inmates to and from visitation areas. That same logic applies to several courtrooms that have installed Renovo systems to eliminate the need to escort inmates to arraignments.

The video visitations also reduce visitor wait times for processing from an hour or more during busy periods to about 15 minutes, Eickhoff said.

Eliminating the need to escort inmates, schedule visits and process visitors also reduces costs significantly, said Capt. Scott Baird of the Rappahannock Regional Jail in Stafford, Va.

"Video visitation has become a proven way for correctional facilities to do far more with less," he said. Indeed, savings with the Renovo system gave the facility "a complete return on investment within 12 months," he said.

Videoconferencing systems have been in place at some corrections facilities for a dozen years as a safety factor, Skaja said. But most of them were manually operated, which still meant inconvenience for visitors, attorneys and clergy.

Nor is Renovo alone in the videoconferencing software market, Skaja said. So he and Eickhoff sought to differentiate their product with upgrades in the area of monitoring visits: Instead of producing separate videos for each side of a visitor/inmate conversation, Renovo combines both sides into a single file that can be accessed online by facility and court officers.

The result is a system that "greatly simplifies the overall process and creates a much safer, less chaotic and more controlled environment for both staff and the public," said Baird, the Rappahannock Regional Jail spokesman.

The Renovo partners borrowed $110,000 from one of Eickhoff's relatives to start the business, but they repaid the loan within six months. There were a couple of reasons for the swift march to stability.

For one, Skaja and Eickhoff started with about 20 clients of a previous employer that went down with the tech wreck in 2001. But one tweak of the business plan played an equally important role: Renovo sells its systems with an annual support and upgrade fee of $150 per video station.

"It kept us going during the slow times," Eickhoff said.