Kevin Bouley, President and CEO of Nerac, Inc., has always had an entrepreneurial mindset. He grew up in what he calls “an entrepreneurial household” and always wanted to run a business. Bouley is deeply committed to fostering entrepreneurs in Connecticut by building relationships and making connections. This summer, he took time out of his day to speak with Innovation Destination: Hartford, provide a tour of Nerac’s facilities and introduce some innovative startup CEOs.
IDH: Let’s start with your background. What sparked your interest in becoming an entrepreneur?
BOULEY: I learned from a very early age that there’s an element to commerce or business or industry or entrepreneurship that involves communication skills—being able to offer something of value in exchange for something else of value.
In 1980, I graduated from the University of Connecticut with a BS in finance and a minor in small business management. At that time, UConn didn’t have a minor in entrepreneurship. It didn’t exist; it wasn’t on the radar. I knew I wanted to run a business. I thought I would end up running my dad’s construction company, but when I was a junior in college, he ended up selling the business.
IDH: So, your initial plan at business ownership didn’t pan out. What next?
BOULEY: I floated out about 40 or 50 resumes. During that time frame, there was a rip-roaring recession underway and many companies were cutting back. All the entry-level jobs for finance majors were being scooped up people who had their Series 7 license who were let go from one company and then moving to another. So, the opportunities in finance for me were very limited.
I took a job at a little research outfit located just off the UConn campus called Nerac, the New England Research Application Center, as an inside telesales person because it was the only job that I could find. I didn’t think I’d be there altogether that long, but they took a chance on me.
That little start led to a whole career in the information industry. Over a span of 9 years I went from telesales professional to accounting assistant to accounts manager to controller to vice president to executive vice president.
As the executive vice president, I worked directly with the founder and former chief executive of the organization. During that timeframe we grew. Our growth mimicked the evolution and growth within the information industry. And our growth resulted in spinning out of UConn in 1985.
IDH: What happened to Nerac as a result of this?
BOULEY: When I started with the company it was a part of the University of Connecticut, it had a contract with NASA and we did a lot of work with UConn and NASA transferring technology to the six New England states plus NY and NJ, that’s how Nerac got its start. When we separated from UConn in 1985, we adopted the acronym Nerac as the company name. It ceased to have a meaning, it was just a name.
Then along came the web. From the earliest beginnings, the first early stages of email, came Netscape, AltaVista, Mosaic, Yahoo, MSN. All of those emerging companies delivering and providing access to content of any type on the web were perceived as a competitive threat by the founder of the company.
He was absolutely correct. He would ask: Why would anybody pay for information if they can get it for free? And we would struggle to answer: Because we have unique information or proprietary information or information that’s behind the firewall or our ability to interrogate it is better than these rudimentary, very simplistic search engines.
The democratization of all this information was a huge disruption to Nerac and it was at that point that the founder began looking for an exit strategy.
IDH: So while the founder thought the business didn’t have a future, you were thinking differently.
BOULEY: Right. I’m thinking if we can connect our resources to the web it would open up whole new markets for us. It would give us a vehicle to connect to customers in a way that today we can barely imagine.
It was the basis of that bifurcated view—one view looking at our demise and the other view looking at a different kind of future—that gave rise to my opportunity to acquire the company. So I bought the company for which I had worked for 18 years and became President and CEO in January 1999.
It was both an interesting and a challenging time to take over the business because the dot com bubble was just about to burst and we were faced with a challenge. Having just acquired the company, I committed an enormous amount of resources to the acquisition. At the same time, I knew that the future of the company was not tethered to its mainframe roots, but instead to the World Wide Web.
Eventually we were able to transition from a company that was entirely network focused on a single device—a mainframe—and instead use the web to open everything up to both our internal users and our community of analysts. We were also able to deliver dynamically to our customers. It was a game changer.
IDH: How did this affect Nerac’s business model?
BOULEY: As with all stories there’s another chapter. We tend to measure the world at Nerac as “BG/AG” Before Google/After Google. Google rendered useless the underlying Nerac business model. So we had to completely reengineer Nerac from the inside out.
We still had robust, rich engineering content, we still had a staff of scientists, engineers, biologists, chemists and people with advanced degrees—many with PhDs. But we no longer needed those resources to perform rudimentary or simple search, we needed to use those resources in a way that became value-added research. So we went from Nerac focused on search to Nerac the research and advisory services company. That’s the company that we are today.
So that’s what I do for my day job: I’m the full-time CEO of Nerac. But looking at the influence that Google had, Google induced an enormous amount of market compression on Nerac. And when this happened, our number of customers shrank, the number of people who worked at Nerac shrank, and we were left with open space in the building. So do you just turn out the lights? Nah, that’s not fun.
IDH: The lights are still on.
BOULEY: [Laughs] I spend a fair amount of time working collaboratively with the University of Connecticut. I’m connected to the School of Engineering, the School of Business and the School of Nursing. I assist the University in developing, teaching and promoting a culture of innovation, creativity and entrepreneurship.
That takes many different forms: It’s being in a classroom with undergraduate or graduate students talking about entrepreneurship or talking about the kinds of things that entrepreneurs do to build a company when they have an idea or an innovation. It’s undertaking formal programs to support entrepreneurship and innovation within the university. It’s being a judge for business plan or idea competitions. This is all represented by a commitment of time. But what that time commitment affords me is an opportunity to see the emerging technologies and the emerging entrepreneurs at a very early stage.
IDH: It enables you to act as a mentor as well.
BOULEY: I act as a mentor, an advisor, a guide. And I take it a step further. I look at some of those opportunities as being so game-changing, so compelling, that I would put together—either myself or a group of individuals like me—folks who are successful entrepreneurs willing to make a commitment to the next generation of entrepreneurship through not only their mentorship and advisory skills, but the application of “magic pixie dust.” We sprinkle these ideas liberally with angel investment capital in an effort to help seed new startups and then assist them to grow.
You could call these efforts the hobby of the crazy CEO at Nerac, but I’m also the acknowledged thought leader for the technology corridor that would link UConn and the communities that surround it in a way that’s measurably beneficial to economic development.
IDH: What are your plans for the future of Nerac?
BOULEY: I want to be able to see not just the two buildings we have on this site, but these buildings and six others housing a whole host of technology-based startups, techpreneurs, who are building out companies—the next generation of entrepreneurial talent—here in the shadow of UConn, in the gateway to the University and the community of Tolland.
We graduate a new crop of kids every year, undergraduates become graduates, graduate students move into the work force. Why do we think that those students, the product of the huge investment that we’ve made in our educational system, need to go to Boston, Austin, Houston, Santa Clara, San Diego or San Jose, when they could just as easily set up shop here in Connecticut? They could be working on a new technology, advancing some form of productization or commercialization of that technology. You can do that just as easily here in Connecticut as you can do it in Cambridge, MA. But you’ve got to think to be able to do it here.
That’s part of what I’m motivated to do. I seize opportunities with these promising new technologies. So, while I’m building the Nerac research and advisory business, I’m concurrently encouraging other entrepreneurs to build their businesses here in Tolland, CT—a scant 5.5 miles from the University in Storrs. I utilize the space that was vacated in the Nerac building. We have about 10 different businesses inside the building today.
We try and give startups a sense of what it means to come out of an academic environment and move into this incubation phase as part of their growth and development plan.
IDH: In what other ways do you encourage collaboration between UConn and Nerac?
BOULEY: Tolland sits at the edge of the real world. You have the University and its academic enclave, which is a powerful research engine, but it has an academic, non-commercial focus. It’s tough to grow a company inside that academic environment. What if you remove them just a little bit and allow them to set up shop here at Nerac? What does that offer them? A professional business environment, a place to meet your first customer, a place to make connections. We’re a mile away from the interstate. That’s the real world.
This environment fosters that transition from academic experiment to commercial powerhouse. It’s the same transition that Nerac went through.
Given the research playground that is UConn, there’s so much going on there that can have a profound and positive impact on any number of industries or market sectors. There’s lots and lots of potential. And we want to expose those potential startups to their prospective customers beyond Storrs.
I support that community by hosting a couple of meetings each month called XcellR8, which is a forum for entrepreneurs to pitch their idea, their startup, their concept, to bring a problem to a forum of a group of 20 to 24 likeminded supporters of entrepreneurs, to seek wisdom and guidance from the crowd. We do this a couple of times a month and we watch companies adopt, adapt, pivot, change, improve and grow as a result.
IDH: What sparked the concept for XcellR8?
BOULEY: Many years ago I was a member of the executive board of the Connecticut Technology Council. A number of us lamented the fact that Connecticut didn’t have a robust network of a community of entrepreneurs, particularly tech-based entrepreneurs. We felt strongly that we were isolated and alone.
As an entrepreneur it’s hard enough, but being on your own makes it extraordinarily difficult. Being around other entrepreneurs, others who are facing the same types of challenges that you are, provides you with an esprit de corps and opportunity to bounce ideas off other people who are in a space and place and might be able to offer some guidance and assistance.
XcellR8 was established as a networking cell in northeastern Connecticut, it was one of four that was originally created by members of the Connecticut Technology Council executive board. I don’t know if the others are still in existence today. But this one here is remarkably robust. It’s a marvel. We accomplish quite a bit with zero resources, just the volunteer talent and the people who show up for the meetings. The conversations and the network relationships and the value that’s conveyed to the startup community is huge by any measure.
The startups that are in the Nerac building participate and benefit from that, so do the student entrepreneurs who are at UConn and so does the community of startups within this region that look for an environment and a place and space where they can meet with other entrepreneurs.
So XcellR8 is by entrepreneurs, for entrepreneurs, all about entrepreneurs.
IDH: The meetings are invitation only. Why is that?
BOULEY: We do that to protect the integrity of the mission, vision and the group. Often people would come to these types of meeting to sell services to entrepreneurs. And I don’t want to go to yet another meeting where I’m going to be pitched on something that I need to buy. I’m going to the meeting because I want to meet somebody else who can help solve the problem that I have, or they’ve got a problem and my experience set will help them solve it—that’s the meeting that I want to go to.
We’ve been able to preserve the genuine nature of our entrepreneurial zeal by being exclusive to who we invite in.
IDH: So how do attendees get invited?
BOULEY: They find me. And they reach out. We typically have a conversation or two. They share their pitch deck. I think about whether the nature of their “ask” of the group is appropriate, whether they’ll get the greatest benefit from it.
I think about the composition of the group and who might be able to provide value when their voice is added to the other voices around the table. And then we tee them up for a presentation, they come in and pitch, and magic happens.
I bring in the students from the Innovation Quest program at UConn after they’ve typically been through the formal Innovation Quest training. We bring in some of the startups that UConn has birthed that are faculty and student partnerships. We bring in entrepreneurs from as far away as New York and New Jersey. One of the startups in the building today came to Connecticut from Rhode Island based upon the resources that are available. So it becomes a magnet for this type of activity.
IDH: So, why build a company in Tolland, Connecticut?
BOULEY: Why not? There’s a rich environment at UConn. Why not stay close to your university roots? Why not stay close to your faculty mentors or your advisors? Why not collaborate? The resources are available here. Why not build a hub of entrepreneurship right here? Why not?