The Brevard Technical Journal

Seizing Opportunity
Staying prepared allowed Jim Witherspoon's company Data Voice, Inc. to remain in business during tough times

By Anne Straub
Brevard Technical Journal

In the lobby of Data Voice Inc.’s office in downtown Melbourne, a computer sits on display. A plaque notes that the AT&T XT Class machine is the first computer used at Data Voice, which started operations in August 1989.

Anyone who has seen a computer in the past decade doesn’t need to read the dedication to know that it’s an old machine. The monitor can’t be more than 12 inches wide, and yet the computer handled all the company’s early business activities until it was retired in November 1990.

Data Voice displays the computer as a tribute to the determination of the information technology company’s founders and a symbol of corporate growth. It’s also an apt reminder of the company’s ability to adapt to new technology and respond to the market changes that almost spelled the end of the startup.

Today, the company can boast growing employment, a recent acquisition that expands its technical capabilities, as well as annual revenues of about $5 million. That’s a stark contrast from the mid 1990s, when changes in the company’s original market almost put Data Voice out of business.

The company was founded 14 years ago by Jim Witherspoon, who took a voluntary layoff package from Harris Corp. to help finance the venture. Witherspoon had done systems engineering work for the Melbourne-based defense electronics company.

His vision was to resell, install and support computer systems. Things seemed to be going his way from the start: Three months after writing his business plan, he met Dr. Maxwell King, then-president of Brevard Community College.

Witherspoon taught calculus and WordPerfect part-time at BCC for some steady income, and became an early tenant of the Palm Bay campus’s business incubator. He moved the business from his living room to rent-free office space that included use of a copy machine and local phone and fax calls.

The deal was so good, he moved in – literally. Days were so long that Witherspoon installed a mini fridge and sleeping area. Instead of his going home, his wife and infant son would go to him and stock the fridge.

Wayne Chance, a test technician at Data Voice, works with motor controller boards. Photo by Tim Shortt, © 2003.

“They’d come and visit me like I was at a work camp,” Witherspoon said.

His wife, who was working full time, would drop off their son during the day so Witherspoon could care for him. While the baby was very small, he would spend most of the day asleep.

“I’d go make sales call with him, and I’d have his bottle for when he woke up,” Witherspoon remembered. Rather than put off potential clients, Quincy won plenty of fans. “It would be such an icebreaker,” said Witherspoon, who spent part of each sales call hearing stories of the clients’ children as babies.

A playpen became an essential piece of office furniture. For a long time afterward, Quincy would prefer playing with a hard drive to the colorful plastic toys more typical of toddlers’ tastes.

Employment grew, and Witherspoon moved out of the incubator to office space on U.S. 1. The company was primarily a hardware reseller and was doing a little information technology service.

Then the bottom fell out of the hardware market.

People started buying computers online, and superstores like Best Buy became prevalent. Suddenly, Data Voice’s services were less valuable. “A guy trying to make a living selling hardware couldn’t make margin,” Witherspoon recalled of the period from 1994-95. The company had a potential market in networking but hadn’t developed it yet. “We were moving in that direction but not far enough, fast enough.”

Data Voice went from 18 employees down to five and found cheaper office space in Palm Bay. Banks closed the company’s lines of credit, and Data Voice wasn’t able to finance purchases anymore.

About $200,000 in private investment capital from friends and family kept the company going for about 18 months. “We literally started over,” Witherspoon said. He used personal credit cards and rebuilt the company’s debt while holding off creditors and continuing to market the company’s skills. During that time, he noted, Data Voice never missed a payroll.

When salvation came, Witherspoon was ready. The company had qualified as an 8(a) small disadvantaged business in 1994, a status that offers benefits in winning government contracts. A former colleague from Harris called, explaining that NASA needed a satellite ground station at the Stennis Space Center in Mississippi. NASA wanted the work done quickly and had suggested that Harris find an 8(a) company to serve as prime contractor. Engineers there thought of Witherspoon.

“We seized the opportunity by having stayed prepared,” Witherspoon said.

Data Voice used its 8(a) standing to help win the contract in 1996, and Witherspoon enjoyed the added psychological benefit of using his former employer as a subcontractor. But the arrangement soon became rocky, and Data Voice ended up rebidding the contract with a different subcontractor.

“I saw the whole rebuilding of Data Voice slipping though my fingers,” Witherspoon said. Despite the changes, Data Voice won the contract.

“I made it work all the way to the bank,” said Witherspoon, who credits the contract with turning the company around. “We were now a systems engineering, design and development company. We were building a satellite ground station for NASA.”

That contract has gone to its upward estimate of $10 million and positioned the company to win additional contracts. Data Voice makes the Memory Loader Verifier for the Navy and handled integration, installation and support of the Telemetry Digital Recording System at Kennedy Space Center. Just last month, Data Voice announced a $3.2 million contract to retrofit and build 1,500 lottery terminals for IGT Online Entertainment Systems Inc.

Data Voice graduated from the 8(a) program in March and is looking for business opportunities to replace it. Top on the list is the HUBZone, a federal program that offers advantages to companies that locate in historically underutilized business districts.

Witherspoon moved the company to downtown Melbourne to help qualify. The catch: At least 35 percent of a HUBZone company’s employees have to be residents of the HUBZone.

That can be a difficult requirement to meet, noted Cindy Dittmer, economic development administrator for the city of Melbourne. Data Voice is one of a handful of companies that are trying to achieve certification in the Melbourne HUBZone, which runs roughly from just north of NASA Boulevard, along U.S. 1 south to University Boulevard and west as far as Babcock Street.

When a company needs specific skills, hiring one-third of its employees from a specific area can pose a problem. One company looking at the program might run into that issue, Dittmer said. “They need engineers, but I’m not sure they’ll find a lot living in the HUBZone,” she said.

Witherspoon expects the recent contract win from IGT to address that requirement. The work will call for Data Voice to add 12 employees for a total of more than 40. The light assembly skills needed are broad enough that he’s confident he’ll be able to hire from within the zone. He can count himself as a resident of downtown Melbourne, and he has gotten a little creative to make the numbers work: Witherspoon has hired an entertainment promoter who lives in the zone and pays him a salary to pursue promotion business opportunities.

Data Voice also is offering the promoter incubator space, a way to give back to someone the advantage that he received early on. That’s a value he finds ways to practice, also serving as president of the board of directors for the Palm Bay Academy K-6 charter school. "This is one example of how Jim gives back to the community where he chooses to live and expand his business," said Lynda Weatherman, president and CEO of the Economic Development Commission of Florida’s Space Coast.

The organization honored Witherspoon at its 2002 industry appreciation banquet, an event designed to recognize manufacturing, high-tech and service companies that contribute to the Brevard County economy. The EDC cited the company’s growth in creating a cabling systems division.

That expansion was the result of Data Voice’s purchase of JB Cabling Systems, which the company had used as a subcontractor in the past. The acquisition gives Data Voice the ability to offer a true telecom broadband solution for new construction and retrofitting. “It took us almost all the way on the voice side as we had built on the data side on our own,” Witherspoon said.

For more information, see www.data-voice.net.