Aver Informatics, which disappointed Wisconsin startup advocates when it moved its headquarters to Ohio last year, appears to be thriving in its new digs.
Aver raised $8.5 million in Series A money from Drive Capital and GE Ventures last May. Three months later, word got out that the healthtech startup was moving its headquarters from Green Bay, WI, to Drive’s office in Columbus, OH. That decision was no doubt a blow to Green Bay’s fledgling startup community and a loss for the state as a whole, which has seen its fair share of promising young companies move elsewhere over the years.
Now, it looks like Aver—which makes healthcare payment analytics software—is starting to execute the vision its management and investors have for the business. The company has grown to about 50 employees, up from around 10 at the time of the Series A funding, according to a recent blog post from Paul Jones, a Madison, WI, attorney who invested early in Aver and recently visited its new headquarters. Aver has been busily signing up new customers and developing new products, and it could grow to 100 employees by the end of the year, Jones wrote.
“I am a bit chagrined to say that, well, moving to Ohio was a great idea,” Jones wrote in the post on the Milwaukee Journal Sentinel website.
Aver CEO Kurt Brenkus (pictured above) did not respond directly to Xconomy’s e-mailed questions, but in a prepared statement, he said that Aver “has continued to rapidly grow its business since relocating its headquarters to Columbus.” The company still has an office in Green Bay and “continues to appreciate the support it’s received from both local communities,” he added.
Aver maintains a Green Bay office, but because it relocated its headquarters and more than half of its staff outside Wisconsin last September, the company triggered penalties and “clawbacks” related to state tax credits on investments made by Wisconsin individuals. Aver paid the state of Wisconsin $90,900 in February, said Wisconsin Economic Development Corp. spokesman Mark Maley. In addition, some of Aver’s investors owe up to $133,750 in tax credit clawbacks, he said.
Investors likely won’t be required to pay the full $133,750 because some of them haven’t claimed the tax credits yet, said Tom Shannon, an Aver investor and its former board chair. “I know that many of them, including myself, have not even used” the credits, he said.
Regardless, it’s full speed ahead for Aver, which has “plenty of cash in the bank” and is quickly growing revenue, Shannon said, citing a conversation he had with Brenkus several weeks ago. “He’s very happy about what’s going on,” Shannon said. “Things are going great guns.”
That raises the question: Would Aver be doing this well if it hadn’t shifted its headquarters to Columbus? Yes and no, according to its investors.
Before the Columbus move, Aver was progressing from unproven startup to a business with a few initial customers. It was poised to take off once it hired a bigger sales staff to sell nationally, Shannon said. “They were on the cusp, and we knew that; that’s why we went for the big raise,” he added.
Shannon said he previously lobbied for the company to at least open a second office in Milwaukee, where there’s a larger talent pool than Green Bay and company leaders could more easily hop a flight to visit customers.
Instead, Aver opted for Columbus. In his blog post, Jones said he doesn’t think there are any inherent advantages to being in Columbus compared with, say, Madison. The only difference, in his eyes, is being closer to Drive Capital and getting the full benefits of the resources, expertise, and Rolodex of its co-founders, who are formerly of Sequoia Capital in Silicon Valley.
Aver’s recent growth probably could have been duplicated in Milwaukee, but perhaps not as quickly without working shoulder-to-shoulder with Drive, Shannon said. “So really, we’re just talking about speed,” he added.
