Cover Story – Work smart, play hard

Posted on Feb 3, 2014 :: Cover Story
Sharon Verbeten
Posted by , Insight on Business Staff Writer
CEO Christopher Knight embraces the Silicon Valley-style work atmosphere at his app development company in De Pere.

CEO Christopher Knight embraces the Silicon Valley-style work atmosphere at his app development company in De Pere.

Thirty-one apps, 40 employees, one laid-back CEO. Pair that with a keen eye on the future and a state-of-the-art building with all the comforts and toys that appeal to a workforce of Millennials and you have SparkNET. The seven-figure app development company in De Pere is reaching for nine figures and global domination.

OK, maybe not that last one, but don’t underestimate the potential of this rising force in mobile technology. That’s because CEO Christopher Knight hopes to create a mini-Silicon Valley right here in Northeast Wisconsin.

That’s no easy task, considering even Knight admits that much of the general public has probably not heard of any of the company’s original apps.

Even though Knight says he’s not looking to invent the next Angry Birds, he does hope to put SparkNET on a larger map, at least among potential employees.

“My philosophy as an entrepreneur is to help create the right environment and the right culture that will attract and retain the best team to pursue our publishing and mobile software development goals; then … get out of the way so that our people can shine,” Knight says.

That forward thinking is just the type of innovation that can help the company and the region grow, says De Pere Area Chamber of Commerce President Cheryl Detrick. There are fewer than a handful of tech companies in the area, and Detrick points out that Northeast Wisconsin is not necessarily top of mind for envelope-pushing technology people. Still, she says SparkNET proves opportunities exist here. “It’s not just paper and Packers.”

Big building, big amenities

Across from the peaceful Mount Calvary Cemetery and fronting a tucked-away residential area off Main Street, just west of Hwy. 41 straddling De Pere and Ashwaubenon, towers SparkNET’s 70,000-square-foot, black-glassed building. It’s the tallest building in Brown County by elevation, notes SparkNET Vice President of Operations Chris Knutson. It’s also a bold footprint for the company, which launched in the late 1990s with dial-up services and email list hosting.

After occupying office space in a multi-office building next door, SparkNET built its new headquarters in 2011. The four-story building was originally planned with three floors. “We expanded it after we broke ground,” says Knight. “The anticipation was that in the next three to five years we’d fill the building.

“Our new headquarters was designed to operate comfortably at 300 full-time, and even though the type of jobs in demand has changed, it’s our intention to continue to grow our team size as fast as we can find qualified talent.” Knight hopes to add at least 24 to 40 more full-time employees this year.

While there is plenty of open space and one floor is barely occupied, the company’s current 40 employees – most Millennials and Gen Xers – seem to be enough to make the company profitable.

“We’re not committed to hiring for hiring’s sake,” Knight stresses. Rather, his goal is to be prepared to add people when the time is right.

SparkNET may be a long way from filling its new building, but it also didn’t lay off any employees during the recent recession. Knight took advantage of lower costs during the recession to expand the company.

But holding onto those employees may have had a delayed effect. This may be the first year the company has not been profitable, Knight adds, noting proudly that it’s been more than a decade since the innovative company didn’t turn a profit. He’s not worried.

“We could stop the whole company and just have two people and continue with seven figures for several years,” he boasts.

A soft-spoken, yet extremely articulate guy who often comes to the office in shorts – and sometimes, barefoot – Knight epitomizes the company’s corporate culture of working hard while still having fun.

SparkNET’s corporate core values are emblazoned in bold typography on a big black wall on one of the floors. Among them are “Be resourceful,” “Over deliver with a smile,” “Create a burning sense of urgency” and, perhaps one of SparkNET’s leading tenets, “Be fun and playful while getting your work done.”

The latter is probably not hard to do – although it may cause a distraction for less disciplined workers. Foosball, table tennis and billiards beckon in the lounge area, where most meetings are informally held on oversized beanbag chairs. Soda and coffee flows, gratis, in several kitchenettes; underground parking is available and one floor houses a gleaming neon smoothie bar for corporate socials. The amenities don’t stop there.

Since one of SparkNET’s core values is “Be healthy, active and fit, both physically and mentally,” it really puts its money where its mouth is, offering employees a gleaming modern fitness room, with top-of-the-line equipment. A hot yoga room, sauna, hot tub and massage room are just steps away from posh locker rooms, complete with heated floors, heated toilets and a bidet feature. And, indeed, there is a free lunch – healthy fare is homemade daily by full-time chef and corporate Ping-Pong champ Ben Griggs.

The fastest way to get to that free lunch? Try the lightning- fast metal slides that connect each floor, adding yet another element of offbeat functionality to this already unique venue. “At the core of SparkNET is an obsession-level of energy that has gone into the intentional design of our environment and the great care that goes into attracting the best/perfect-fit team members. None of this happens by chance or accident,” says Knight. “We don’t like the idea of work/life separation. You integrate your life, your play and your work.”

Social media content specialist Jenna Kast has worked at SparkNET for five years, in both editorial and social media roles. She appreciates the amenities for what they bring to the employees’ productivity. “We have a lot less burnout,” says Kast. “It’s really fun and really health-conscious too. The important part about our culture is having these amenities … and they are a bonus in addition to pay,” she adds.

While some past employees have taken to the social media universe to grouse about the company — inferring that glorified amenities don’t make up for what some consider low pay — Knight is keenly aware of those detractors.

“As you know, there are always two sides to every story. It’s been on my mind for a few months now, and it’s time we shared our side of the story,” he says.

“Hell, yes,” he says, such complaints bother him, especially when the company goes so far beyond what others even dream of. “The reality is everyone is at a different place in their career, and we’re often the first real job many new college graduates have. They either have no point of reference or a very limited point of reference of what others in the market offer.”

In 2006, Knight says the company paid $8 per hour for editorial positions and was inundated with applicants. But turnover was high.

They later tested $10 per hour, and that cut turnover by half, Knight says. Base pay now for editorial staff is $12 per hour, although the team works on salary, not an hourly basis.

Developers/Programmers make $15 to $25 per hour, a rate Knight considers “great for right out of college.” He notes that SparkNET has seen many of its developers receive generous pay increases of 8 percent to 15 percent in a year, “only to have them quit because they needed yet more money, even though they weren’t creating more true economic value,” Knight says.

“Our goal with pay and benefits is to attract and retain top talent,” he says. “When we misstep with that, we re-evaluate and address the issues.

“I’ve always believed that money is a measure of perceived and real value delivered. Ultimately, we do provide a competitive pay and benefits package, otherwise we’d have no chance at retaining our talented team.”

Chris Knutson affirms that that corporate culture, along with SparkNET’s many amenities, has helped the company keep turnover down. (Knight estimates it at an average of 3 percent or less annually.)

It’s all part of creating happy, satisfied employees who will work hard for the team. Chris Knutson says, “Creative minds need this… it makes us better.” But he’s quick to add, “It definitely takes a good working team.”

Finding a talent pool

AppsFinding that team hasn’t always been easy, however, especially for its IT department, where it seeks to recruit talented coders and app developers – both qualified for the job and willing to endure the weather and lifestyle in Northeast Wisconsin.

“The schools here are just catching up,” says Penny Knutson, SparkNET’s production manager. The company’s product marketer, Marc Stevens, concurs.

“Schools are pushing for kids to become more involved in coding,” he says. It’s all part of a national Hour of Code initiative, aimed at introducing high schoolers to computer programming.

At Ashwaubenon Schools, SparkNET is getting feedback from students on apps that have the potential to impact learning.

“SparkNET is getting a real-life laboratory,” says Matt Anderson, instructional technology coordinator for the school district. “They’re getting authentic feedback from kids. From a student standpoint, they love doing it. We’re excited to have such an innovative and forward-thinking company right up the road.”

For SparkNET, those up-and-coming minds are, understandably, its future. One of the company’s earliest ventures was EzineArticles, an online content aggregator, in which an in-house editorial team reviews and posts articles submitted from authors worldwide. Authors are not paid for submissions, but the website acts as a portal, generating traffic to the authors’ websites.

At its peak, EzineArticles had 52 million unique visitors per month. That number plummeted around 2011, when Google and other search engines changed algorithms that affect search engine optimization (SEO). For 2014, the company expects to average at least 10 million to 15 million unique visitors per month.

“We still have half a million active annually. It’s my hope that EzineArticles continues to be a major part of our business in 2014,” says Knight. “True content marketing or educational content marketing will never die. Customers always want to be better educated, to research purchases, identify new solutions and therefore, there will always be a demand for more free expert advice. Obviously, we hope to be squarely in the middle of that market demand.”

Monetization of online ventures is always key to a tech company’s success. Today the company’s seven figures come mainly from advertising revenue streams generated by industry giants Google, Yahoo and Microsoft – 99 percent based on EzineArticles.

“We also bring in healthy premium membership fees from our paid EzineArticles members.”

In 2014, Knight envisions a 60/40 percent split, where 60 percent of the company’s revenue comes from online advertising and 40 percent coming from apps.

He’s also anticipating a boom in mobile accessibility, followed by revenue.

Now, about one-third of SparkNET’s visitors are on mobile devices.

“I’m hopeful that mobile monetization will grow,” says Knight, noting that advertising income via mobile is much less than when a visitor accesses via laptop or PC.

But while EzineArticles will continue to thrive, Knight doesn’t envision additional positions. “EzineArticles could triple without adding more staff,” he says, making note of the division’s adept use of software to aid in vetting and processing submissions.

Recognizing that mobile devices are the future, SparkNET began creating mobile apps a few years ago. All the apps are created in-house, not for outside customers, and owned by SparkNET.

“Apple is now our fourth-largest client for iOS app sales, with educational apps being our strongest revenue generators,” says Knight.

“Educational apps are where the money is right now,” adds Knight, who doesn’t code, though he previously owned and operated PC Specialist, a company which configured computers and offered hardware repair in Green Bay. But it’s a soothsayer’s business, really, since end users don’t know what the next best app is they will need, he notes.

Among the company’s apps are games (Tiny Hoarders, Zed Destroyer) and others as diverse as Black Friday Companion (to map out the day’s shopping), Racquetball Journal, Weather Cubby (which teaches kids how to dress for the weather), Atta (a smoking cessation tool), Meme Something (which transforms photos into memes – this is the company’s most successful app by downloads) and educational apps that teach coding (most successful by sales).

The educational apps show the most promise, Knight says, especially to schools and institutions that purchase licenses for multiple copies.

Along the way, SparkNET and Knight have learned lessons, and not everything the company has done has turned out as planned.

“I’ve built things from nothing and sold them,” he says, noting that he’s launched and killed about eight different businesses. “I’ve screwed up enough.”

Among them was one of his earliest ventures, Sparklist, an email list hosting company he sold around 2002.

While SparkNET built the service and managed it, an outside company wrote the code and software. Together, it created a $3 million revenue stream.

“We didn’t intend to sell Sparklist,” says Knight, a Kewaunee native who has marketing degrees from the University of Phoenix and Northeast Wisconsin Technical College. But when the outside company wanted control of the product, they saw their only option was to sell, in order to allow the service to their customers. “We had spent the previous five years building a strong network engineering team and service staff, but failed to build a software development team.

“The big lesson in this success/failure story was to ‘own the code,’ which translates into building a software development team so that whatever we and our clients dream up, can become a software reality.”

The future is now

Knight looks forward to 2014, when he hopes iOS app sales will be on pace for their first seven-figure run rate. “We’ve been building apps now for 2½ years and have written dozens of apps,” he says. “We’re learning a lot of what works and doesn’t work.”

That learning curve is all part of who Knight is and, ultimately, what SparkNET is and will continue to be.

And Detrick, for one, thinks SparkNET is a brilliant combination of technology and corporate culture.

“It’s one of my favorite businesses because I love ‘out of the box,’” she says. “Chris Knight and SparkNET is so far ‘out of the box;’ they’re in their own sphere.”

 

SparkNet

Founded: 1996

CEO and president: Christopher Knight

Employees: 40, with plans to hire 24 to 40 in 2014

Website: www.sparknet.net

 

Being Knighted

Some people may wonder why Christopher Knight’s name sounds so familiar. I asked him just that as we chatted — him barefoot, me in boots — in the oversized beanbag chair lounge at SparkNET.

“Is that your real name?” I queried, reminded of the actor Christopher Knight, best known as Peter Brady in the 1970s sitcom The Brady Bunch.

Seemingly surprised at the question — and perhaps never asked that before — Knight admitted that he legally changed his surname years ago; since he was starting businesses, he wanted a name easier to pronounce than his given last name, “Sevcik.”

Knight chose his surname based on his affinity for the 1980s television series “Knight Rider,” about a car outfitted with artificial intelligence.

While the original car (K.I.T.T.) in the series was a black Pontiac Trans-Am, Knight himself drives a black BMW M5…as far as we know, with no artificial intelligence features…yet. – Sharon Verbeten