Read Time: 15 minutes
Welcome to Episode 49 of Students vs. Startups. This week, moderator John Gilroy talks with the Chief Operating Officer of 540, Chris Bock. 540 is trying to create a frictionless environment inside the government and promote data sharing across organizations, listen to how they are tackling this challenge below!
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John Gilroy: Welcome to Students Versus Startups Showdown on the Potomac. My name is John Gilroy. I'll be your moderator today. Hey, big round of applause for show number 49 here. Yeah! It means something. I don't know what it means. It means something. Al Gore hasn't shut down. It means something.
We are sitting in the offices of Eastern Foundry. We took over a conference room, Occupy, Arlington, wherever it is. We have a little table here. One side of the table, we have a student.
Other side of the table, we have a startup. We have a little 26-minute conversation, we walk out of here fast friends, and hopefully have a little bit of an idea of how startups maybe engage and sell and some of their marketing plans and their digital strategy. That's the whole idea behind this podcast.
Our student here is Greg Forman and he's recently finished his degree from Georgetown in systems engineering. Is that your degree, Greg?
Greg Forman: That's correct, yeah, and I currently work for the Mitre Corporation. I do economic analysis and acquisition support for them, and I have a background in finance.
John Gilroy: Wow, that's a perfect fit for our guest today. Our guest is Chris Bock and he is the Chief Operating Officer for a stranger name company. The company is 540. Tell us about your background and about this company, 540, please Chris.
Chris Bock: Sure, so I'll start with myself. I grew up here in the DC area. My folks moved here when I was eight. I went to college not too far from here. I went to James Madison University. After college, I got a job working for the Department of the Navy working in acquisition and contracting and cut my teeth there in terms of getting a good functional background in how the government works, how the government does business, how they buy things.
Then, after about five-and-a-half or so years doing that, I went into consulting, worked at a place called Coopers & Lybrand, which ultimately merged with Price Waterhouse, became PwC, which we've all heard of. I also spent some time with a little company called IBM. I spent 13 years there working in IBM's federal consulting practice. I ran part the part of IBM's business that focused on procurement consulting for public sector organizations, so federal governments, state and local, healthcare, higher education.
Wedged in the middle there, though, I did go to work for a startup in San Francisco in 2000, venture-backed, took my shot, had a good time, learned a lot. We went out of business, like most other startups in that era. But, a huge learning experience.
Then, about three years ago, I had an opportunity to join 540. 540, at the time, where we were about a five-person organization, focused on federal government, specifically Department of Defense. You mentioned our funny little name. It's actually a great conversation starter for us because that's almost always one of the first questions I get is, "What does 540 stand for?" 540 is actually the sum of the angles of the Pentagon.
John Gilroy: Oh, I didn't get that.
Chris Bock: It ties directly back into who our initial customer base was.
John Gilroy: I thought you had 540 years of experience. IBM, the Navy, the background is pretty wide, isn't?
Chris Bock: Yeah, it's interesting. As I sit here, I don't want to say how many year later, but it's a number of years later.
John Gilroy: You seem like you're an NFL quarterback, you're playing for the local peewee league. It seems like you have this big skillset for a small company.
Chris Bock: No, no, no. 540 is ... I mentioned when I started, there were five of us. We're at about 35 right now, so we've grown quite a bit, and we've expanded our client base. I joined because our founder, John O'Brien, has a real vision and passion around helping make the government more effective and how it manages and uses its data. We talk about trying to create a frictionless environment inside the government, and sharing data across organizations. I see a lot of opportunity to help the government become better about the way it does its business.
For me, I was in the right place at the right time. I was ready to go back. I had been at a startup once before, so I wanted to get back to that small, build something from the ground up. The energy and the passion behind that, I was ready for all of those things. Even though we're a small company, we're trying to do big things.
John Gilroy: And friends with our previous guest, Avery Brown.
Chris Bock: Yes.
John Gilroy: He's a character.
Chris Bock: Yes. I see him in the halls at 1776 pretty frequently.
John Gilroy: Greg, you want to jump in here?
Greg Forman: Sure. So, just say we ran into each other in the elevator. Give me a quick pitch on what business is that 540 does.
Chris Bock: So, our focus is helping the government, and specifically the Department of Defense, unlock its data. There's data all over the place within the department. It's scroll away and old systems and Excel spreadsheets. It's all very disparate, and in some cases, very hard to get to. Our vision is a department, an organization, where that data is able to flow freely inside the enterprise, and outside to the extent that it needs to, so that people can get access to it, can do cool things from an analytics perspective, make better business decisions, that sort of thing.
We're not an analytics company. We're not necessarily building pretty pie charts and things like that. We're all about unlocking the data and creating that frictionless environment.
John Gilroy: I just had a friend who was hired by Red Hat and he sent me an email today and he said, "Open source is where it's at." From an acquisition perspective, Greg, what do you think, harder to acquire or easier to acquire?
Greg Forman: From an open source perspective, just from my experience with the government, they are very rooted in their ways and have a lot of processes that don't always make sense to outsiders, but there's obviously reasons why they've come about.
Open source, on the other hand, seems like it could offer a lot of solutions in this space. I don't know open source solutions very well, so maybe you could give us some examples or maybe explain a little bit.
Chris Bock: Sure. So, I certainly agree with you that there are some inherent barriers to innovation in the government, and a lot of that is security based. There's a lot of it that's just based on ... I think a lot of it is based on perception. There's a perception of open source that's got to be bad ... That's maybe the wrong word, that's got to be vulnerable. So, there's an education process that we try to go through.
But, the other thing that we've really seen, and this is as some of the more innovative organizations have started to get some traction in the government, the US Digital Services, 18F, those types of organizations, they are obviously much more open-minded when it comes to things like open source, see the value of it and see the benefits to not being locked in to particular vendors, particular technologies.
So, in our case, as a small, innovative company, what we're really trying to do is find those people within the government that have that mindset, have that way of thinking. There are always going to be people that you're never going to get to that point of being ready to necessarily innovate. Our mission is to try and find the people that are willing to be open-minded and open to open source.
John Gilroy: There's a fellow who sat in that seat a couple months back. His name is Dr. Cameron Gorginpour. I don't know if you were there, but he talked about the Air Force and OTAs. In fact, he came back for an Eastern Foundry event and had filled the room, talked about a new innovative way to acquire things for the Air Force. It seems like the government needs ... An outsider who has a PhD from California, comes in and says, "Here's a new way to achieve objectives in the Air Force you never thought of before." They couldn't hold on to him.
Are you familiar with the OTAs and how this works? Is it something that you think is appropriate for buying software as well?
Chris Bock: I think are definitely innovative ways. Being a former acquisition and procurement person, I appreciate the value of the process and I understand why it's there. Anytime you're talking about government acquisition, government programs, you're talking about taxpayer money, there's a fiduciary responsibility that we have as government officials to make sure that the dollars are spent in the right way, that there's a level playing field, fairness, all of those sorts of things.
But, having said that, I also see the downsides to those processes and how they can stifle innovation, and anytime there's an opportunity to do something different, in terms of the way the government buys things, it's important to explore.
One of the things that we've particularly been encouraged by has been the way a number of organizations have gone about issuing solicitations for development programs, for agile delivery services, is the inclusion of technical challenges. We've participated in a number of those. 18F was really the first organization to do that. They put out a solicitation. This was, oh gosh, two-and-a-half years ago, and they had all of the vendors build something. It's like show me what you can do, use open source tools, and instead of focusing on what have you done in the past, what can you write in a proposal and a technical volume, show me some software. Show me something that you've built. Show me the process. Do it out in the open. Do it all in GitHub.
We're starting to see more of that, and I hope that will continue to happen because one of the things, again, as I put my former hat on as a government procurement official, it's very frustrating when you go through an entire process of doing a procurement, awarding a contract to somebody and then they're not able to deliver. You award to the low price or some semblance of best value and you end up with not a capability that's accomplishing the mission that you set out to achieve. So, anything that the government does in terms of innovating the procurement process is a positive in my mind.
Greg Forman: So, I'm curious who within the government would be your target audience.
Chris Bock: That's a good question. As I mentioned, we certainly focus on trying to find those pockets of innovation. In some places, it's a little bit more obvious. If there's an organization that has a Chief Data Officer, typically if an organization is forward-thinking enough to have a Chief Data Officer, they are probably thinking about, "What's my data strategy? How should we be better managing our data?" And hopefully they fill that position with somebody that is open-minded and wants to hear about what the possibilities are. So, anytime we see a Chief Data Officer, that's somebody that we're going to probably want to talk to.
But, there are also pockets of innovation all over the place in different government organizations. Our focus is on attending ... We still do a lot of the attending industry days and things like that when we see keywords like agile delivery services, open source, maybe some specific technologies that we know fit into that bucket that represent potential organizations that at least gives us some indication of, hey, these folks might be forward-thinking and might be the types of people that we want to work with and that we can help be successful.
John Gilroy: I went to your website, 540.co, and all kinds of hashtags there, #api, #angulardata, #data, and the one I liked was #elasticsearch. Earlier this year I assigned one of my students to talk to people. I said, "Talk to George Young." Elastic search is exploding. So many sales. I don't know if they can even print enough invoices for all they're selling. It got to the point, one of my students turned to me and said, "I want to meet George. I want to apply to work in elastic search."
Is this the kind work with, new and innovative? Very creative way to take a look at search.
Chris Bock: Yeah, absolutely. We know George. We've actually, again, we take the perspective of how can we make that data available so that you can do cool things with it? Elastic is a great platform to enable that.
One of the things that we're doing as an R&D project, and this is something that we've actually had going for the last couple of years. We use it as a platform to show what our abilities are. It's called Fed API. It's a platform where we're essentially harvesting publicly available data and then making available via APIs. We built it on elastic search. So, we're pulling in data. We're pulling in procurement data from the federal procurement data system next generation. We are pulling in budget data from the budget books that are issued.
One of the cooler things that we are doing with it and I think as a showcase of what we can do, we're ingesting bid protest information, decision data from the GAO. When the GAO issues a bid protest decision, they just essentially issue a document. It's a PDF, and if you're interested in what was the outcome on such-and-such protest, you can go and read it and look at it.
We're actually harvesting that, bringing it in Elasticsearch, and making that information searchable, so you can run analytics on it and you can do analysis on bid protest decisions over time and look for trends and things like that. So, we've built that as a showcase for what the art of the possible possible is and elastic is part of what makes that possible.
John Gilroy: So, Greg, when you hear the phrase bid protest, does that keep you up at night? If you have to go to the dentist, I mean ...
Greg Forman: Yeah, I think I'd rather get a root canal than handle a bid protest, to be completely honest. So, I actually would like to pivot just a little bit. How would 540, how do they foster innovation? How do they come up with new ideas? How do you know which areas to try and go after?
Chris Bock: We really focus on listening to what people on the government side are saying. We don't necessarily go into a meeting with a Chief Data Officer or a Chief Information Officer with some sort of an agenda, "Here's how we're going to sell you 540 and make you better." What we really want to do is hear, "What's your problem? What's your business challenge?" We then take that back and try and figure out a way to address that. We consider ourselves to be builders as opposed to talkers or writers. As I mentioned, when I was talking about the technical challenges, that's we elected so much because that's where we're able to show what we can really do. We don't have to have a technical challenge to build something. We'll sit down with somebody, a senior person in the government that talks about some business problem that they're having. We'll go home over the weekend. We'll hack together a solution, come back as early as the next Monday and say, "Is this what you were talking about?"
It's amazing how well that resonates and it really hits the mark when you can show them. Then they can say, "Oh yeah, that's really good. That's what we're thinking. But, boy, it would be really cool if it also did these three other things." It gets to a point where then the engagement model shifts a little bit and you start to talk about how can we get into a business relationship with one another so that we can actually build something for you?
John Gilroy: Listening to Chris, I'm thinking to myself, there was a commercial years ago. It was, "Not your father's Oldsmobile." The old traditional way would be a guy with a suit and tie would come in and say, "This is the answer. We're the square peg in a square hole." Now it almost seems more like what Greg would do, come in and say, "Well, let's be real flexible about this. Let's listen and flex and move and try something and fail and try something and move. This is classic dev ops, classic agile with software and development." That's what you're describing.
Chris Bock: Yeah, absolutely.
John Gilroy: Billboard, skywriting? How do you market yourself?
Chris Bock: Thus far, we've done a lot through, honestly, word of mouth. The government community, we work a lot in the acquisition and procurement space. In the Department of Defense, we're dealing with a lot of organizations that handle business information, program information. That's a huge community, but it's a tight community and they talk to each other. That's been, honestly, a big part of the way we've grown.
We do take the opportunity when it's available to speak and present in open forums, talk about things that we're doing. We haven't evolved to the point yet of running ads on the radio or anything like that. Maybe someday.
John Gilroy: I haven't heard the word badged, haven't heard the word security, haven't heard the word cybersecurity yet. It seems like if you walk into the Pentagon, you've got to have two of those words on your business card, don't you?
Chris Bock: Sure. I think one of the things that has helped us is the fact that our foundation of our company, being working in the Department of Defense from the outset, we kind of know what we're getting into when it comes to that. We're not naïve. I'm a former government person. John O'Brien, our founder, also former government. He was with an organization called The Business Transformation Agency back in the mid-2000s. So, it gives us I think a little bit of credibility when we sit down across the table from a government person, that they understand that I understand you used to work at the Navy, or you used to work at the BTA. So, having that foundation, and understanding that there are requirements around security, for example, and there are certain constraints that you're going to have to be able to operate in.
We're fortunate that we've cultivated within our team an understanding of those. So, when our folks are putting together solutions, they're always done within the overall parameters that exist from a security perspective and things like that.
Greg Forman: I'm curious who you might think your competitors are.
Chris Bock: Our competitors. In this environment. Personally, my competitor with this one particular client is probably my partner with another. We've been very active in trying to participate in the community in terms of meet ups and things like that, meeting other companies that are like us that are small, aggressive, forward thinking. We tend to try and find opportunities to work together rather than work against one another. I would suppose that those types of companies do represent our competition, at least on that playing field of agile, technical challenge procurement types of opportunities. We don't see ourselves competing with big system integrators, those types of organizations.
We try to focus ... We're focused on the build. We're not focused on the operate, the O&M. We don't have a bunch of consultants. I'm making air quotes. We're not the functional butts in seats type of an organization. That's not what we're trying to be. You don't really see us competing with those types of organizations, at least from a traditional we're both bidding on the same types of things.
John Gilroy: You're the guy with the IBM background, though.
Chris Bock: Sure.
John Gilroy: Three-piece suit and the briefcase and we're the square peg in the square hole. What happened?
Chris Bock: I spent a long time with IBM and I learned a ton. We did some really great things. I think even in a big organization like that, there are opportunities to be innovative and to do cool things. I was a little bit more on the process side within IBM as opposed to the technology side. Everything that IBM does has some aspect of technology overtone to it.
But, we were definitely focused on trying to push the envelope from process perspective in terms of how organizations handle and run their procurement operations and how to be innovative in doing procurements a different way.
So, even in an organization like that where you're one of many, at the working level, you're working in relatively small teams and trying to crack the nut to be innovative in order to help your clients be successful.
John Gilroy: Last question, Greg. Do you want to jump in here, please?
Greg Forman: I think this is a good one to end on. Where do you guys see yourselves in maybe five, ten years? What's the end goal?
Chris Bock: The end goal for us, if we are able to continue to grow and help more and more organizations be effective, then I think we'll consider ourselves successful. We're not a traditional startup. We're not venture backed. We're self-funded. We're not beholden to any sort of investor community or anything like that.
We're really passionate about our mission and helping our clients be successful, and to the extent that we can find more people in the government that think the way that we do and want to innovate, want to do things the right way and make things better, the more of those types of people that we can uncover and work with. That's success for us. If that means we've doubled in size, great. If that means we're the same size we are today, that's great, too. We're not beholden to any metrics.
John Gilroy: Great job, Great. Chris, we're running out of time here. If people want more information about 540, where should they go?
Chris Bock: Sure. As you mentioned, John, our website is 540.co. We do have a Twitter handle, 540co. You can also get information there. We're located at 1776 in Crystal City, which it's been a great place for us. It's a hub of innovation in the northern Virginia area. So, stop by to visit.
John Gilroy: Great. If you would like to have show notes, links, or transcripts, please visit theoakmontgroupllc.com. I'd like to thank our sponsor, The Radiant Group. If you are interested in getting involved in geospatial projects, contact The Radiant Group. We are hosted by Eastern Foundry. It's a community of government contractors who are bringing innovative solutions to the government marketplace. For more information, go to eastern-foundry.com and if you would like to participate as a student or startup, contact me, John Gilroy, theoakmontgroupll.com, and thanks for listening to Students Versus Startups showdown the Potomac.