April 13, 2014

Steve Papa, Endeca & the Entrepreneurial Spider Web Effect

One of the main reasons why the Boston tech scene is thriving has to do with the spider web effect.  Meaning, when employees spider web out of companies (that likely had an exit) and become entrepreneurs… which in return creates more companies and opportunities for others.  It’s a multiplier.

We all know about the Bay Area, where this behavior is encouraged.  We are starting to see more and more of it in Boston.  In the past, alum from companies like Open Market, m-Qube, Upromise have gone on to create several other great companies in the Boston area… but it is shocking that we didn’t see more of it from companies like Akamai or ITA Software (which was acquired by Google for $700M) to name a few. 

However, this mindset has changed and we are seeing more examples out there… especially the crew out of Endeca.

Endeca and its founder, Steve Papa did an excellent job at bringing in top talent and grooming them to become future entrepreneurs.  The company had a $1.1B exit to Oracle and since then, the whole Boston tech ecosystem is seeing the benefits of the spider web effect.  Need proof?  Check out our slideshow:  The Massive Endeca Alumni Spider Web.

We recently caught up with Steve to chat more about one group in particular at Endeca…  the Special Operations team, which reported directly into him.  At the time, Endeca had scaled to 200 – 300 employees, so they were no longer a startup.  They used the Special Ops team as a recruiting vehicle to attract high energy, top academic talent.  This team would get involved in very complex problems that their customers were facing.  They had to figure out a solution and build out a proto-type to ultimately solve it.

If you think about it, the Special Ops team was like an R&D function which was building out new products and solutions for Endeca, as their technology was very horizontal (enterprise search) and could be used in multiple ways.  This team allowed them to build new and innovative products and attack different markets for revenue growth.

Some of the products that came out of this team were some of their mobile solutions and a universal technology for the business intelligence platform.

Steve looked for people who constantly wanted to learn and put in the time to see the reward.  It was a creative and unstructured environment, where failure was ok and you might fail repeatedly until you get it right.  Thus… teaching this team the core ingredients of starting a business.  The solution that you create might not always be the one that is the driver of success for your company, but you need to learn at each step along the way and it’s ok to fail.

According to Steve, about 20 people were hired into this team (some were hired from outside of Boston) and today, 12 of them are founders in companies.  Some local examples include with the years they worked at Endeca: 

I was reminded of this Special Ops team after watching the video from Scott Kirsner's interview with Steve at last year’s TEDxBeaconStreet event.   Here’s the video:

What is Steve up to these days?  Well, he’s not one to just kick back and relax.  He is a founder and the chairman of a startup called Parallel Wireless in Nashua, NH.  He plays a key role in terms of helping them out with their strategy and signing up partners and early customers.  He is Chairman of the Board at Infinio in Cambridge.  He also spends a lot of his time mentoring and advising entrepreneurs in the SaaS industry, plus he is a very active angel investor. 

Boston needs more spider webs.

Keith Cline is the Founder of VentureFizz.  You can follow him on Twitter (@kcline6) by clicking here.

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