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Worcester Chamber Names Skyscope Creative Entrepreneur of the Year

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In an announcement heralding the “overnight success” of a rapidly growing central Massachusetts-based company, The Worcester Regional Chamber of Commerce recently named Skyscope Creative as its choice for Entrepreneur of the Year.

Alex Dunn, Skyscope’s Chief Operating Officer and one of its three founding partners, expressed his appreciation for the recognition. “From the very outset, Skyscope’s mission has been to help the world’s most interesting and important technology companies solve key business challenges with creative and effective video. We work very hard to deliver the best for our clients, and it’s nice to know that the business community is recognizing us for our efforts on their behalf.”

Founded in 2012 by classmates Dunn, Sam Shepler (CEO), and Gabe Gerzon (Creative Director), all were enrolled in Clark University’s MBA program and had an obsession with video production as well as a shared vision for its largely untapped potential in specific business applications. The field was far from empty, but the three grads saw they had an advantage that set them apart, so they launched Skyscope and got to work. Today, the company they founded in a shared off-campus apartment now occupies an entire floor of newly renovated warehouse space and is among the nation’s very best producers of video for business. Their roster of clients includes Cuisinart, The Game Show Network, Emirates Airlines, and Pinterest – among dozens of others.

It may have made sense to some to launch their hot new media agency in either New York, Los Angeles, or even Boston, but the three chose instead to headquarter their new venture in Worcester. While none of the three were native to Worcester, all had grown familiar (and enamored) with the area while attending Clark. They recognized the city offered the rare combination of a skilled workforce, low-cost space availability, easy access to transportation infrastructure, and a resurgent attitude; all ingredients for success.

One factor contributing to the company’s culture of entrepreneurial spirit is their willingness to make room for talent – even if that talent is not immediately applicable to a specific job description. Says Dunn, “We host these ‘Entrepreneurs-in-Residence’ for the express purpose of keeping creativity at its peak. We encourage them to work on projects that they want to pursue, recognizing that enthusiasm is a strong contributor to success. Each of those we have nurtured in this way have gone on to great success, but don’t think for a minute that we don’t recognize the benefit we receive from the relationship. It is a true win-win.”

Skyscope Creative is a true entrepreneurial success story – and the book’s not yet done being written.

Stop & Shop and Hannaford – The Makings of an Arranged Marriage

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The parent companies of regional grocery giants Stop & Shop and Hannaford have been looking into combining their operations under one umbrella for quite some time, but they may have a small roadblock in that plan – the Commonwealth of Massachusetts.

The shareholders of Royal Ahold and the Delhaize Group were quite enthusiastic about news of a possible merger, demonstrating their assent by way of a significant rise in both stock prices. However, some officials here in Massachusetts think antitrust issues may bring the entire affair to a screeching halt.

Hannaford has 25 stores in Massachusetts and another 131 fly the Stop & Shop banner. Like many brick-and-mortar competitors in other industries, they are often set up in close proximity to each other and officials fear this will lead to problems with fair competition following the proposed merger.

Both companies do more than 60% of their commerce in the US. While Ahold, parent company of Stop & Shop, has properties mostly clustered in the Northeast, Delhaize does most of its business in the U.S. as Food Lion, a Southeastern regional powerhouse. Analysts say that a merger would realize somewhere in the neighborhood of $670 million per year in reduced costs.

Massachusetts officials are far more concerned with the issues of competition. Economists who favor the position of the state are saying that the merger could go off without a hitch if some of the stores were sold. Everything is speculative at the moment, however, with both sides looking for a way to compromise.

It is unclear whether the merger of the two companies would result in a name change. Both brands are valued in the state, and part of the issue rests in trying to determine what will happen with the customer-facing side of the brand.

Keep your eyes on this space for updates.

Top CEO Salaries in Massachusetts

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A current hot topic in the media is the growing gap between CEO and average workers’ salaries. In Massachusetts, the average CEO made 97 times the average worker’s salary. This data comes from “Executive Paywatch: High Paid CEOs and the Low Wage Economy,” published by the American Federation of Labor and Congress of Industrial Organizations (AFL-CIO). The study notes that runaway CEO salaries are fueling economic inequality, highlighted by findings that the average worker in Massachusetts made less than $50,000 a year in 2013 compared to the average CEO, who made almost $5 million in that same period.

National statistics show that the average CEO-to-worker pay ratio in 2013 was 331 to 1, and the CEO-to-minimum-wage-worker pay ratio was 771 to 1. Massachusetts has six CEOs on the AFL-CIO’s Top 100 CEO Pay list. The top paid CEO in Massachusetts was Hari Ravichandran of Endurance International Group Holdings. His total compensation in 2013 amounted to over $52 million, which is 1490 times the average American worker’s pay. The second highest paid CEO was Trip Advisor‘s Stephen Kaufer. He received almost $40 million in 2013, 1107 times the average American worker’s pay.

The AFL-CIO report opined that the current ratio of CEO-to-worker pay is simply unconscionable. However, not everybody agrees. Mike Stenhouse is the head of the think tank Center for Freedom and Prosperity. Stenhouse commented that wage disparities naturally increase in a depressed economy. This is because there is a decreased amount of middle-class jobs available, which lowers the average income for all. Therefore, free-market CEO compensation should be of no concern to taxpayers.

The AFL-CIO actively supports raising the federal minimum wage to over $10/hour, claiming it offers a simple way to repair the weak economy, boost consumer spending, and increase the purchasing power of low-wage workers. Nevertheless, critics still feel that raising the minimum wage will only force businesses to either raise prices, lay-off workers, reduce hours, or use more automation.

The following is a list of the Top CEO Salaries in Massachusetts:
#50. Nigel Travis – Dunkin’ Brands Group, Inc., Canton: $4,206,643
#49. Michael R. Minogue – Abiomed Inc., Danvers: $4,606,673
#48. Michael A. Bradley – Teradyne, Inc., North Reading: $4,845,964
#47. P. James Debney – Smith & Wesson Holding Corp., Springfield: $4,873,237
#46. Peter R. Chase – Chase Corp., Bridgewater, MA: $4,891,223
#45. Scott A. Buckhout – Circor International Inc., Burlington: $5,008,416
#44. Michael K. Simon – Logmein, Inc., Boston: $5,138,234
#43. Louis Hernandez, Jr. – Avid Technology, Inc., Burlington: $5,229,014
#42. Linda K. Zecher – Houghton Mifflin Harcourt Co., Boston: $5,236,252
#41. Frederick H. Eppinger – Hanover Insurance Group, Inc., Worcester: $5,237,208
#40. Josef H. Von Rickenbach – Parexel International Corp, Waltham: $5,519,080
#39. David Aldrich – Skyworks Solutions, Inc., Woburn: $5,800,648
#38. Harvey J. Berger, M.D. – Ariad Pharmaceuticals Inc., Cambridge: $5,872,437
#37. Brian Concannon – Haemonetics Corp., Braintree: $5,977,595
#36. Vincent T. Roche – Analog Devices Inc., Norwood: $6,090,567
#35. Mark S. Casady – LPL Financial Holdings Inc., Boston: $6,137,333
#34. John M. Maraganore, Ph.D. – Alnylam Pharmaceuticals, Inc., Cambridge: $6,236,122
#33. Patrick M. Prevost – Cabot Corp., Boston: $6,309,405
#32. James Heppelmann – PTC Inc., Needham: $6,502,968
#31. Robert F. Friel – PerkinElmer Inc., Waltham: $6,511,991
#30. Michael Bonney – Cubist Pharmaceuticals Inc., Lexington: $6,606,945
#29. Marc Beer – Aegerion Pharmaceuticals, Inc., Cambridge: $7,036,536
#28. James C. Foster – Charles River Laboratories International Inc., Wilmington: $7,041,418
#27. Alan J. Herrick – Sapient Corp., Boston: $7,154,464
#26. Michael G. Kauffman, M.D., Ph.D. – Karyopharm Therapeutics Inc., Newton: $7,335,194
#25. F. Thomson Leighton – Akamai Technologies, Cambridge: $7,631,578
#24. Thomas J. May – Northeast Utilities, Springfield: $7,660,999
#23. Jonathan Bush – Athenahealth, Inc., Watertown: $8,027,133
#22. Leo Berlinghieri – MKS Instruments, Andover: $8,030,721
#21. Harlan F. Weisman, M.D. – Coronado Biosciences Inc., Burlington: $8,176,551
#20. Ron Zwanziger – Alere Inc., Waltham: $8,176,723
#19. Christopher Garabedian – Sarepta Therapeutics, Inc., Cambridge: $9,701,492
#18. William L. Meaney – Iron Mountain Inc., Boston: $9,766,616
#17. Ronald L. Sargent – Staples Inc., Framingham: $10,767,880
#16. Michael F. Mahoney – Boston Scientific Corp., Marlborough: $10,851,430
#15. James D. Taiclet, Jr. – American Tower Corp., Boston: $12,221,026
#14. Joseph M. Tucci – EMC Corp., Hopkinton: $12,645,957
#13. Jeffrey M. Leiden – Vertex Pharmaceuticals Inc., Boston: $13,126,474
#12. Philip M. Pead – Progress Software Corp., Bedford: $14,239,235
#11. George A. Scangos – Biogen Idec Inc., Cambridge: $15,015,147
#10. Joseph L. Hooley – State Street Corp., Boston: $15,841,234
#9. Marc N. Casper – Thermo Fisher Scientific Inc., Waltham: $16,168,880
#8. William H. Swanson – Raytheon Company, Waltham: $17,146,254
#7. Paul A. Ricci – Nuance Communications, Inc., Burlington: $17,939,756
#6. Sean M. Healey – Affiliated Managers Group, Inc., Beverly: $20,007,855
#5. Carol Meyrowitz – TJX Companies Inc., Framingham: $22,514,033
#4. Mortimer B. Zuckerman – Boston Properties Inc., Boston: $23,821,829
#3. Stephen P. Macmillan – Hologic, Inc., Bedford: $24,458,289
#2. Stephen Kaufer – Tripadvisor, Inc., Newton: $39,014,227
#1. Hari Ravichandran – Endurance International Group Holdings, Inc., Burlington: $52,518,620

New England States Explore Energy Alternatives

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Energy is expensive everywhere. However, while it may not be widely known elsewhere around the country, it is certainly no secret to those of us living here in Massachusetts that the commonwealth ranks as one of the most expensive when it comes to energy costs. With this in mind, state legislators and energy companies are making a concentrated effort to procure alternate sources of energy to augment current supply.

Officials from the state’s utilities and energy boards hope to source renewable energy from northern regions of the U.S. and Canada while simultaneously opening channels of less expensive natural gas via pipelines from both southern and western areas.

As part of this “diversified” solution, supplies of Canadian hydroelectric power already being generated will be imported while northern New England continues to develop wind farms on a mass scale.

National Grid, a provider of both gas and electric services in the Commonwealth, issued statements saying that both energy sources should be approved. Marcy Reed, the president of National Grid Massachusetts recently stated: “We say we need both pipelines.” National Grid normally “stockpiles” imported liquefied natural gas that is shipped in through port facilities. However, the gas was traded on a global market last year, and New England was the highest global bidder for those natural gas supplies. According to various sources, during the last three winters since 2011-2012, New England paid $1.6 billion to $3.8 billion higher wholesale electricity costs than has been typical.

The Joint Committee on Telecommunications, Utilities and Energy is getting ready to hear from clean energy industry officials and those representing energy derivatives from power plants.  Committee Co-Chairman Sen. Benjamin Downing, pointed out that utility companies believe a lack of capacity in gas pipelines is the main culprit behind rate hikes during recent winter months and say there is an urgent need for natural gas flowing into the state from external sources.

According to Matthew Beaton, the Secretary of Energy and Environmental Affairs, other energy experts are saying the scarcity of natural gas is a “regional affair” and governors from several New England states are convening soon to discuss regional energy policies.

Report: Massachusetts One of Top ‘Middle Market’ States

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The Middle Market Power Index from American Express and Dun & Bradstreet reports that Massachusetts has 3,963 middle market companies with annual revenues between $10 million and $1 billion. This translates to just a bit over one-percent of all businesses in the Commonwealth. According to the report, this ranks fourth in the country in terms of percentage of middle market businesses. (Illinois had the highest percentage of middle market companies, followed by Wisconsin and New Jersey.)

The report’s numbers and findings come from Dun & Bradstreet’s proprietary databases of commercial businesses operating in the U.S.

The percentage of middle market businesses in the Bay State was also more than 30% higher than the national average. Nationwide, there were more than 136,000 middle market firms, making up about 0.7 percent of all businesses.

The report showed that Massachusetts can also boast about having almost double the average national percentage of large businesses with annual revenues exceeding $1 billion. The state has 84 such businesses, making up about 0.02 of all the state’s businesses. In the U.S. as a whole, the percentage of large businesses was only about 0.012 percent.

The overwhelming number of businesses in the United States are considered small, with annual revenues of less than $10 million. Nationally, small businesses make up 99.27 percent of all businesses. Given the numbers cited above, it should come as no surprise that, in Massachusetts, that percentage was a bit smaller, with only 98.97 percent of the state’s total number of businesses classified as small. According to the report, the total number of small businesses in the state numbered 390,760.

Nationally, middle market firms employ an average of 368 workers and generate an average of $45.1 million in revenue per firm per year. While the middle market makes up only 0.7 percent of all businesses nationwide, such businesses contribute slightly more than one in five dollars of all business revenues and employ about 28 percent of all private sector workers. Unfortunately, the report did not offer similar information for Massachusetts or any other state.

 

Some MA Business Owners Urging Delay of Sick Time Law

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In November of 2014, by a margin of 19 percent, voters in Massachusetts clearly expressed their wishes that a statewide provision be implemented requiring all employers to offer sick time. Every employer in the state will soon be required to offer either paid or unpaid sick time, depending on their number of employees. In each case, employees will be required to accrue the time with their hours worked, one hour for every thirty. This sick time is to be available to all employees, whether full or part-time.

The regulations are expected to be issued by the Attorney General’s office in mid- June and the law is set to go into effect this July. However, some employers are concerned, saying that the compressed time frame simply doesn’t allow businesses enough time between that publication date and the implementation of the earned sick time law. This is the primary complaint being voiced by most businesses. Without those regulations in place for use as a guideline, they say, businesses will be unlikely to be able to fully comply with the new law quickly enough. There are also concerns about businesses modifying existing sick time policies to match up with the new regulations, particularly given that most are likely in the middle of their fiscal year. Representatives from both camps are now asking that the date for implementation be pushed back to January of 2016

On the other side of the argument are proponents of the new law, like Raise Up Massachusetts, who want the law to go into effect as it was originally intended – on the very same timeline chosen by voters. They claim that the people have shown that they want this law and that this matters more than any difficulties businesses may face as a consequence of implementing the new law.

 

Worcester Chamber Lists Annual Business Award Winners

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The Worcester Regional Chamber of Commerce announced their list of local business award winners, all of whom will be honored at a special ceremony commencing at 4:00 p.m. on May 14, 2015, at The Haven Country Club in Boylston.

  • The Richard B. Kennedy Business of the Year award goes to Imperial Distributors, located in Worcester and Auburn, a company that has handled supermarket non-foods distribution and merchandising services since 1939.
  • West Side Steak & BBQ won as Small Business of the Year.
  • Skyscope Creative is honored as the Entrepreneur of the Year.
  • Percy’s TV and Appliance received the Family-Owned Business of the Year.
  • Jim Donoghue, the Tweed’s Pub owner, is the Chamber Advocate of the Year.
  • The Joe Cohen Retailer of the Year is Crompton Collective for its innovative addition of a farmer’s market and, later, an event venue.
  • Maureen Raillo, CEO and president of WLimo, West Boylston, is the Ambassador of the Year.

The Silver Hammer Awards for local distinguished construction or rehabilitation projects has three winners:  SpencerBANK for turning the former Fire and Telegraph Building on Park Avenue into a branch with a community room for the public to use; Winn Companies, for restoration of the former Worcester Technical High School into housing known as Voke Lofts, and Commerce Bank for its restoration of the Slater Building on Main Street.

Congratulations to all!

Massachusetts’ Unemployment Rate Lowest In 7 Years

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The Executive Office of Labor and Workforce Development (EOLWD) announced Thursday that Massachusetts unemployment fell from 4.9% in February to 4.8% in March. This is the lowest unemployment figure since February of 2008. The “Great Recession” drove Massachusetts’ unemployment to a high of 5.9% in March 2014.

The labor force participation rate, as defined by the Bureau of Labor Statistics, is “the percentage of the population [16 years and older] that is either employed or unemployed (that is, either working or actively seeking work).” This number increased 0.3% to 66.2% in February, its highest point since June of 2010 and up a full percentage point from March 2014.

The Massachusetts’ economy added 60,200 jobs; 49,400 of which were private sector since March 2014. The EOLWD reports that the private sector added 10,700 jobs in March. The most significant gains were 1,400 jobs in manufacturing, 4,900 in hospitality and leisure, and 5,500 in education and health providing services.

The National Association of Business Economics (NABE) projects continued economic growth for the duration of 2015 and into 2016. The outlook expects the United States’ GDP to grow by 3.1% through 2015 and 2.9% in 2016. Predicted increases are derived from data linked to government spending, housing investment, and consumer spending. Recent trends in labor market strengthening are expected to continue, adding more jobs to the Massachusetts’ economy.

Raytheon buys 80% of Websense for $1.9 billion

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In an effort to improve its cyber-protection technology, Waltham-based Raytheon has reached agreement with private-equity firm Vista Equity Partners LLC  to acquire an 80 percent share of Websense Inc. for $1.9 billion. Vista acquired Websense two years ago for about $990 million.

Raytheon plans to integrate Websense into its existing  Raytheon Cyber Products unit and operate the new division with Websense incumbent CEO John McCormack at the helm.

In addition to contributing the $400 million cyber products unit,  Raytheon will infuse $1.6 billion in cash, $600 million in the form of a loan. For its 20 percent stake, Vista will contribute $335 million to the venture.

Websense’s Triton platform, which allows companies to adapt and respond to future cyber attacks, is said to be what particularly appealed to Raytheon.

In November, Raytheon spent $420 million to bolster its intelligence business by acquiring surveillance and cybersecurity company Blackbird Technologies.

Advanced Manufacturing Report Urges a Change in Public Perception

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The New England Council released a report on Wednesday that urged for increased training for advanced manufacturing workers throughout New England. At the same time, they recommended changing the public’s view of these industries by focusing on its safety.

The report, titled “Advanced to Advantageous,” identifies influential industries in New England that are setting the pace in advanced manufacturing. These industries include aerospace, defense, medical devices, software and biotechnology. The report praised certain programs as being progressive “islands of excellence” that combine existing advantages while encouraging other industries to adopt them. The report provides recommendations to increase growth and improve global competitiveness.

Below are highlights of the recommendations:

  • Improve partnerships between government, educators, and industry.
  • Create a federally funded manufacturing center in New England.
  • Transition the public’s perception of manufacturing from dangerous to safe.
  • Increase industry partnership and apprenticeship opportunities for students.

James T. Brett, president and CEO of The New England Council, commented that “manufacturing and higher education organizations across New England have told me how invaluable our report has been to them.” Brett hopes that the report will encourage broader discussion among the public and private sectors, improving collaboration between the two. Brett added that this was necessary in order to “support advanced manufacturing to promote sustained economic growth in every corner of New England and strengthen our regional competitive advantage.”

Manufacturing and education sectors will mutually benefit from increased training, apprenticeship opportunities, and partnership ties. The public also needs to understand that manufacturing is a safe career choice. If this can be accomplished, advanced manufacturers in New England will be stronger and more competitive.