Read Time: 15 minutes
Welcome to Episode 30 of Students vs. Startups. This week, moderator John Gilroy talks with the CEO & founder of Enlightened, Patrick Novak. By effectively utilizing HUBZones, Enlightened is able to offer IT and other various consulting services to adequately match hubs of businesses with federal contracts. Read below to learn more about HUBZones, and how your business could benefit from Enlightened's services!
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John Gilroy: Welcome to Students vs. Startups showdown Potomac, my name is John Gilroy and I'll be your moderator today. Hey let's have a big round of applause for show number 30, this is excerpt number 30 and this is all with the permission of Al Gore's amazing internet, no FCC needed for this show. This is a podcast, if you've heard it before, you know what we do. We've kind of taken over a room at Eastern Foundry in Rosslyn, Virginia, in the Washington DC area and we have a table. We have three students on one side of the table, we have a startup or a company on the other side of the table and we just have at it, after 26 minutes we walk out of here as friends. And the idea is students finally get to get away from the textbooks and ask a real human who are in business, and find out exactly what their challenges are and what some of their struggles are.
Our three students today, we have Jimmy McAndrews, we have [Obi Ukeyboo 00:01:05], and we have Matt Pearson.
Jimmy tell us about your background please.
Jimmy : Hey John, I'm a DC area native, now working for Deloitte Consulting, strategy and operations consultant, and I'm a recent graduate of the Georgetown University's School of Continuing Studies Systems Engineer Manager program.
John Gilroy: So you actually walked and got that fancy diploma and left?
Jimmy : Sure did. They haven't taken it back yet.
John Gilroy: That's good. And the other two are just wannabes. Obi your background please.
Obi Ukeyboo: Sure. Obi here. I primarily come from a background of strategy and analysis in [inaudible 00:01:37] financial services and also product development. I'm a recent graduate of the NYU Stern School of Business, second-year Master student at the Technology Management Program at Georgetown. Currently do a lot of freelance work, and strategy and product development for seed and series A companies in the DC area.
John Gilroy: Wow that's good. And Matt your background please.
Matt Pearson: I'm just about done with a Masters of Technology Management at Georgetown, be finished up in August. I'm currently working at Georgetown doing operations and data analysis for their noncredit[inaudible 00:02:05] programs.
John Gilroy: So you're in the big project at the end. What's that called? The capstone-
Matt Pearson: Capstone, yep, working on that right now.
John Gilroy: So what's your focus on your capstone?
Matt Pearson: Working on the change management process for a CRM for the University actually.
John Gilroy: Change management, everyone hates doing change management.
We're going to change to this side of the table and our company today is called Enlightened and our guest is Patrick Novak. Patrick how are you?
Patrick Novak: I'm doing great, thank you very much for having me on the show.
John Gilroy: Went to your LinkedIn profile, pretty impressive background you have there. Tell us about your background and your company please.
Patrick Novak: So my background is for the past three and a half years I've been doing business development to the government for Enlightened. Before that I was doing business to business, defense contracting with a lot of the groups here in town. Before that was flying some aircraft for the Navy, and then before that I was [inaudible 00:02:52] at the academy.
John Gilroy: So a graduate of the Naval Academy. So we got three against one but that seems like fair odds, huh?
Patrick Novak: Like them, like the odds.
John Gilroy: So I will give you the questions to ask everyone. So what business problem does Enlightened solve?
Patrick Novak: The biggest business problem that Enlightened currently solves, we're primarily an IT services firm, with [inaudible 00:03:12] consulting winged to it. The biggest problem in federal contracting right now is, especially with small businesses. Right now we are at about 30 million-dollar company, we're still in the small business size standard. The biggest problem is finding small businesses, small hubs of businesses, which are also certified as, to perform on federal contracts, to do the servications, and capability, and breadth and depth, or clearances. And so those factors all go into what we offer the government today.
John Gilroy: So there are some listeners that know what a hubzone is, something that has to do with a car, tell us what a HUBZone is exactly.
Patrick Novak: Sure. So a HUBZone company is historically underutilized business zone. It was put in place to essentially develop economies at a lower scale. So there are places throughout the US that are underdeveloped and so if you contract in those areas with those workforces, you get contractual preference for federal contracting. And so the way we do that and the way we maintain our HUBZone status is by employing in lower income areas be it through mail processing centers or through call centers. And that's one of the biggest drivers in America's getting so many jobs, and if a company's aim is to do that to at least 35%, then you give them a contractual advantage. Right now there aren't enough good HUBZone companies that do IT. If you could imagine there's a disparity between living in a lower income area and then being a JAVA programmer. We kind of mash and marry those two sides of the fence.
John Gilroy: There will be a whole different set of challenges from our previous guest, isn't it?
Obi, want to add a question please?
Obi Ukeyboo: Sure. When it comes to that matching process, what are some of the other characteristics that you consider outside of the HUBZone certification? Are there certain features of an individual, so to speak, to their ability to do work. What are you looking for?
Patrick Novak: From a company perspective, if you're referring to what qualifies our company outside of being a HUBZone company, there's a couple standards in which the industry executes process ability contracts. And
"the government's biggest question to small businesses "can you do this work?" Can we trust that you're going to follow a process that's repeatable and that's going to work it's way out?"- Patrick Novak, CEO & Founder of Enlightened
[inaudible 00:05:20] level 3 for development and level 2 for services are two different ways of doing that within the context of [inaudible 00:05:26] consulting contracts.
So when you run across a company that has executed or has the qualifications along with the HUBZone, has a clearance. That's a whole different ball park in a different level. Like I said, there's a lot of HUBZone companies that may be dealing with construction, a few other areas of business, but not within IT and that's the gap that we're really trying to fill.
John Gilroy: So Jimmy, when I listen to Patrick talk about his company, he seems to be and established company but he has a mindset of a startup. He's constantly seeking and looking for new opportunities and still growing the company. I guess that's the only way you survive these days.
Jimmy : It seems like it. I'm kind of curious about how you go and drive the business going forward and what your strategy is. You have this HUBZone certification, how do you communicate that and what parts of the enormous federal government are you specifically targeting these days or hope to target in the future?
Patrick Novak: Exactly, so when you advise the federal government on how to contract with you, because that's kind of the approach you should take, right now there are certain agencies that are lacking in that capacity. The government says you have to do X amount with [inaudible 00:06:24] or whatever it might be. There are a certain percentage of HUBZones. If from a strategy perspective I want to fill that gap first, for example, just down the street here, the State Department, they have a tremendous gap in their contracting for HUBZone companies so we meet with individuals and contracting acquisitions management that need our support and we help to fill that.
Same thing with DISA, they have a contractual gap. And to identify what their spending gaps are, then you address their business problems following that. You're not going to offer a service that they don't need. So once you marry up those two you have a real nice fine line to communication and execution of the contracts.
John Gilroy: Patrick, I'm an old History Major, and when I think of the Enlightenment, it's people looking at problems in a new way. And so I guess your company Enlightened, what they're trying to do is look at creative uses or a different approach to a typical problem. Is that what Enlighten is all about, or how did they come up with that name?
Patrick Novak: Exactly. So it's not a yoga and health [crosstalk 00:07:16] We won't be meditating, although we do that sometimes in the office.
"The idea of the name of the company primarily stems from, when we're looking at your problems, we're going to show you issues that you may not be aware of before. And we're going to shine light on issues that you weren't aware of. That's the primary function of it right."- Patrick Novak, CEO & Founder of Enlightened
And you can kind of see that in a small business case. For example for a certain customer who we won't name, once we started engaging with them and figuring out what their plan was to move a training facility from one location to another, they had no idea what the financial impact would be back to the government on that. And there's a huge political impact as well. So what we'd probably do is do a needs analysis and a gap analysis and do a plug-and-play on that, and that's something that we'll do outside of the scope of work just as added security and added investment from our perspective and that's how we invest with the government.
John Gilroy: Now I want to go back to your project, change management. That's exactly what he said. Well Patrick, the handle change management, and people run from that, maybe you can ask a question about change management, how they can do that?
Matt Pearson: Yeah, that's a good question, that's a whole industry right there that people don't normally pay for, for the actual change management, the people side of it. I'm curious you guys provide, management consulting, is that one of the services you provide, is that something you look into?
Patrick Novak: Change management is certainly a function of one of our biggest prime contracts with the federal government today. When I think change management for the government, for example if the government says here's what we're going to do, I'm going to outsource my problem, my headache, because my people aren't talking to a government contractor, what I have to do is I have to go back to marketplace and find people that look, feel, and smell like that group. And I'll go bring in an expert, a few experts that have spent a long time inside that agency to get a real perspective of what their problems were and what their problems are going to be. So it's really important for companies to invest in outside experts who are very familiar with that agency, otherwise you're coming in cold, you have no idea what you're talking about, and there's no familiarity with it. So when it comes to change management, it's a hearts and minds operation, and you have to have processes to back that up but it's a people problem at the end of the day.
"So if you can't emotively motivate people to do, and you're probably very well aware of the couple different nodes that there are for change management. And so being able to tune in to the right one is where we can make sense."- Patrick Novak, CEO & Founder of Enlightened
Matt Pearson: Obi I'm listening and listening, I haven't heard HTML, I haven't heard load balancers, I haven't heard "go to the cloud," I've heard more human issues rather than technical issues here with this company, huh.
Obi Ukeyboo: With that being said, would you say that human relationship is part of your methodology when it comes to finding out how you can best help your clients?
Patrick Novak: The biggest, most effective issue within a business that I can think of is making sure that people are taken care of. 100%. If your internal organization is not optimized, of your people aren't happy, if you don't have people who have the emotional intelligence to be able to pull the right strings at just the right time, you're not going to be able to relay that value back to the government. I don't care how good your IT is or how good your algorithm is, unless you're really understanding what the human problem is, you're never going to have a chance at being successful and right now we're up to that problem where we're a small business now but in probably 18 months we'll be on the other side of the fence in joining the big guys. But you want to keep your roots in mind because to me, a large company is simply a collection of much smaller companies and so you're always going to keep that, not necessarily a family aspect, but a highly emotional intelligent environment, so that way you can always be keen on what issue you're facing any time.
John Gilroy: So Jimmy, when a gentleman like Patrick walks into the Pentagon and deals with generals, and he talks about emotional intelligence it sounds like a tough topic over there, I would never go in there with that.
Jimmy : Yeah, I mean, I guess you have some experience from your background at kind of connecting at that level-
John Gilroy: That most people couldn't-
Jimmy : Yeah absolutely, myself included, there'd definitely be an intimidation factor that comes with it. I guess, what from your background besides hey I was at the space too, etc. How do you connect with those people and what makes that connection different than, say, someone at the State Department or the FDA [crosstalk 00:11:19] sometime.
Patrick Novak: Yeah, so the agencies that typically, that I've dealt with have had either a law enforcement or a military complex to them and I think you guys all might be aware of what the multi-complex could be. You train some guys, you put them in a box, and you try to cookie cut every single person-
John Gilroy: So Patrick when you go to the office they go "hey, we know this guy, he's one of us."
Patrick Novak: He's got a beard, he doesn't look like any of us. There's a cross-section of similarities that do approach when you work sort of what the customer is, and that's good to have, but, stepping back a little bit, when you walk into a place and figure out what the issues were with, why I want to make that change to more of an emotional approach, is that, when you start to notice any inconsistencies or any problems within your company, you want to fix them immediately. For me, I want to make sure people are happy and optimized, and if they're doing that, they're supporting me from a business development and operations perspective without question. You get unquestionable loyalty when you have really good interaction with people. And the same thing happens when you're interacting with a government customer you've never met before. If you give a quick, good emotive connection, it sticks, and that will always come back around.
John Gilroy: Now they have to go back to change management and a lot of times change management means telling people, or having them change the way they are comfortable doing things. We've always done it this way, well guess what, old Matt walks in the room and from now on, everyone has to write with his green pen or something, so, I mean, this is a challenge. Getting people happy also getting people happy while they change the way they're doing it I don't know what the magic sauce is there.
Matt Pearson: Well I thought you actually mentioned a lot of it, of touching on the emotive aspect of it. We just finished the class talking about attachment theory. Very interesting to think through people naturally attached to objects or ideas, and in a lot[inaudible 00:13:09] in the military, where you actually have a lot of things they attach to, to do their jobs. And if you remove those, the productivity goes down, absenteeism goes up, very complex combination of factors. Actually it's interesting, so I was looking at you guys' Facebook page and I noticed it is almost entirely internal communications and events. So you have a bunch of pictures of internal celebrations, birthday parties, awards. I'm curious, is that part of your HR policy or HR practices, is actually using social media to build the community within your organization?
Patrick Novak: Social media is a sliver of an element, in terms of how we interact in a social perspective. Facebook right now, unless you want to hire someone as a full time employee, someone to manage your Facebook and your Twitter and all that kind of stuff, our priority isn't to manage that social media aspect at this current state in the game, that's not how we push the business forward.
I want to go back to that initial comment you made about the attachment theory and getting people to make moves. Then that's where you employ like a modeling situation where you have to get them to look, feel, and smell. Like what they know and what they're used to. And that's all about establishing the lines of communication that they're familiar with. So once you have that communication hierarchy, you have to, not manipulate, but carefully move around the key pieces in the organization without completely ripping them out but move around just so that way they can optimize everything.
John Gilroy: Patrick has an event today and spend five hours for people who are pounding in tables talking about moving to the cloud, cloud this, cloud this, cloud that, and making these big changes. Miguel from the room is an Amazon web services, AWS, and factor CTO is up on stage with a German accent telling them this and that, and it's better and better and better. Now I would think that in a military environment there's going to be a lot of resistance to taking and moving information from where it's comfortable behind a firewall to a cloud. Is this part of your challenge also?
Patrick Novak: Part of the challenge is, for example, some of the services that we'd have to provide to the government would be cloud based for storing the data. DISA for examples is all about protecting the entire infrastructure for the DoD. This is the communication backbone for the DoD.
John Gilroy: You want to tell the listeners what DISA stands for?
Patrick Novak: It's the Defense Information Systems Agency. So that's basically an organization that all the other, the Army, Navy, Air Force, they all kind of report up to it, and it's that chain that links around the entire world. They were going through a process today about how to protect that system, so I don't know if you've heard about, it's so much of a missile defense system, an object that's moving at the speed of sound, how can you go ahead and attack that? That's the issue so the whole cloud aspect that you're talking about, the government is certainly scared about going into that but they're looking at creative solutions about how to keep that moving so the enemies have to keep guessing whether they're going to go ahead and interact. It's definitely an interesting concept. They don't have it done yet, they admit that they're still piped in a lot of different areas, but they are looking at it aggressively. Within the next five years, I think that's going to be they fail or go no go point.
John Gilroy: Obi.
Obi Ukeyboo: When your customers are done working with your clients, better yet, what are some of the largest highlights that you've had this year, in 2017 thus far, when your clients, they come to you, they have a problem that needs to be solved, they have a project objective, what are some of the takeaways that they say, after working with Enlighten, now I've been able to do x, y, and z.
Patrick Novak: So when you look at a problem on a smaller scale, in a government agency, for example we did a workforce modeling tool. And the government agency couldn't figure out where all their people were, and this is kind of a security related issue. So this government agency had a very difficult time ascertaining where all their folks were and what they were doing. We built that workforce modeling tool for them and the larger parent group to that smaller problem took notice of that. We're now in the process of relaying that back to the larger parent group and that was spread across the entire agency eventually using our tool. So the win is when the larger part of the organization buy into really what you're trying to do and they go we haven't thought about that problem before, and we haven't taken the time to work with the contractor to help solve it. We se that it works, let's try it at a larger scale. That's always the winning part that you can engage there from that perspective.
Another win that we had, for example, we just won the DoD Mentor of Protégé Nunn-Perry award, so we are a small business and we are investing in many other small businesses and we're mentoring other small businesses and the DoD just recognized us for being the first small business in history to win that award by mentoring other small businesses. Typically it's the Leidos and the SSE's and all the big guys, this was a big move for us because it shows what we're willing to invest on a smaller scale which always reflects on a bigger scale.
John Gilroy: When you read biographies of people like Steve Jobs, what they try to do is try to anticipate what consumer demand is. Now I went to your LinkedIn profile and talk about thinking about their problems when they aren't. Well that's what Steve Jobs did. He thought about an iPhone before even conceived it, but that's a very difficult hill to climb, it's tough to do.
Patrick Novak: It's extremely tough to do, it is one that's also more difficult to have accountability with the government in terms of having that kind of conversation. For example, the government may send something out called the RFI or a sources sought, and that means that they have a problem they want you to solve. The problem with people responding to those is that the dialogue doesn't really occur with the government. People send in a couple sheets of paper with a solution on it, but they're never really engaged beyond that. So we take a really forceful approach to resources sought process, which is thinking about your problems when you're not, which means there's no real money on the table. When RFI comes out, you have a situation where a company is looking and they kind of scoff it because they have to invest their time and money into putting a light level, 30% solution, but that makes a big difference, if you follow up closely with the government, get that conversation going, that's where we find our success. Just thinking of investing just a little bit ahead of the curve enough to where we can make sense.
John Gilroy: Jimmy you work for one of the bigger companies, and so how can you compete with someone as nimble as this and dynamic, it seems that rather than compete, you'd partner.
Jimmy : Absolutely, team all the way. That was kind of my question, how do you stay agile? You work in the HUBZone certification, you move from this and that but how do you stay current with maybe a smaller workforce through the ever-changing environment around us here, in the DC area?
Patrick Novak: By [inaudible 00:19:21] two different answers to it. One is a great section of how you're helping communities, so for example, we work really closely with the mayor, here in DC. So mayor Bowser and Enlighten are very close, in terms of how we interact with them and they back up us up a lot because workforce development is a huge issue. For example, over in Howard University, we just started a [inaudible 00:19:41] education center, so that'll work on executive education for people that are within IT, but it's also going to focus on developing people here locally in DC, for them to go ahead and get introduced into IT and to get certifications, so that way we can start employing here locally in DC. Because our offices in downtown DC is a HUBZone down there, believe it or not. That's one part of how we interact. We interact at the mayor level, for sure, [inaudible 00:20:06] work with.
And then outside that, the teaming is great. When you want to address how do we stay nimble, we have a lot of really good partners and we even have a lot of great, not micro, but smaller partners, maybe 25 or 30 person companies that are in different agencies that provide a lot of value back to us, so once again, even though we're a large small, we're behaving like a large by having a lot of really strong partnerships, and even with the large companies, we have amazing relationships that we wouldn't be successful without. So defense contracting will always be a group game, even though there's a lot of coopetition out there, and I think once you've taken those two areas you can be successful.
John Gilroy: You know if I was on jeopardy and they asked me the question, name a HUBZone, I'd say maybe Detroit or rural Arkansas, never downtown Washington DC. This is a question I'd miss on jeopardy, maybe you'd get that question-
Patrick Novak: 1101 Connecticut Avenue-
John Gilroy: Really, that's a HUBZone? How, I never would have guessed that.
Patrick Novak: It's a HUBZone. It's based on, the corner of the White House lawn is a HUBZone and it's based upon census data, and it's based upon, DC is a very transited area, so you know how people on one area that have the salaries, that are typically here in this area, they're living out west on 267 or north or around the city. And so there are areas and HUBZones [inaudible 00:21:22] out in Leesburg and certainly down in Texas and New York and throughout the rest of the country there are a lot of HUBZones that need a lot of attention.
John Gilroy: We'll have to use my saving line next time on jeopardy. Matt, quick question here.
Matt Pearson: It'S interesting to hear, just in the way you describe it, clearly being a HUBZone organization provides you with priority for contracts, but I don't hear you actually talking about it as a primarily financial decision, it actually sounds like a mission driven decision for the organization, which is always a tough call in an organization, making mission driven decisions that might have financial costs and falling in the bottom line. How do you guys balance that?
Patrick Novak: If one of your most important tenets of an organization is to support the community that you work in, you're willing to take that hit. Because being a HUBZone business, it does cost a lot of time, it costs a lot of time and money from an internal perspective, we have to have people and program managers internally, that can manage working with that workforce. So 100% it is difficult, and it has to be more of a mission first, more of a community first driven aspect. And our CEO Antwanye Ford is very keen on supporting the community and that means that everyone else in the company is the same. There's no other way to have a good organization, great organization, amazing organization without amazing people that care about what they're doing for the areas they live in.
John Gilroy: Great job students, great job Patrick. Patrick if someone's listening to this wanted more information, what website should they visit please?
Patrick Novak: www.enlightened.com
John Gilroy: E-N-L-I-G-H-T-E-N-E-D, Enlightened.
Patrick Novak: Yes sir.
John Gilroy: Okay, good, good, good. I'd like to thank our sponsor, the Radiant Group. If you are interested in getting involved. If you are interested in getting involved in geospatial projects, contact the Radiant Group. We are hosted by Eastern Foundry, a community of government contractors who are bringing innovative solutions to the government marketplace. Much like Enlightened. For information, go to eastern-foundry.com. If you would like to participate as a student or startup, contact me, John Gilroy, at theoakmontgroupllc.com. Thanks for listening to Students vs. Startups showdown Potomac. Thanks for listening to the Students vs. Startups podcast, the podcast that lets students face off with startups. If you like what you hear subscribe on iTunes, tell a friend, and tune in next week.