IPOs signal booming technology industry - and it's just beginning

By Brice Wallace

Pluralsight Inc. recently became a public company. Get ready for more of the same.

During a discussion about the future of Utah’s technology sector at a recent tech industry gathering, one panelist predicted that several more Utah tech companies will have initial public offerings in the next year and a half — unmatched in the state’s history — indicative of the strong growth occurring throughout the sector.

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“I think that over the next 18 months, you’ll have four to five companies go public in the state of Utah,” Clint Betts, executive director of Silicon Slopes, said at the annual members meeting of the Utah Technology Council (UTC). “That will be unprecedented in our state’s history. Fantastic. It creates a lot of jobs. I always tell people, if we just had Qualtrics, we’d all be excited, but we’ll have six of them. And we have another 10 below them and another 20 below them.

“We’re heading into kind of uncharted waters as a community. We have never seen this amount of healthy companies in the state of Utah, and everything that they’ve built and everything they’re about to do over the next five to 10 years will kind of be unprecedented, right? We’ve never had four to six tech companies go public in 18 months. It’s never happened in the state of Utah.”

John Knotwell, UTC’s president and CEO, noted that a decade ago, Utah had “only a handful” of tech companies but that figure has ballooned to more than 6,500. And that growth has occurred despite several challenges noted by the panelists: a lack of capital, a lack of enough skilled workers and a lack of gender diversity in the workforce.

“I remember a decade ago, we had a different set of conversations but the same conversation about growth,” said Cydni Tetro, co-founder and president of Women Tech Council. At that time, there wasn’t enough capital to fuel even startup companies, she said.

“When you think about companies going public today, it’s because there’s an entire group of people and a state committed to actually creating a platform for growth. … It’s taken, I believe, over the last two decades, step by step, of investment from the state, from a community, from a technology level, in order to get us to a place where you actually have companies that can grow here and can reach that,” Tetro said.

Even with the state’s tech boom, only 23.5 percent of state’s tech workforce is women, compared to a national 27.5 percent level. Less than 5 percent of the state’s business executives are women, Tetro said.

“There’s a big focus for us on ‘how do you increase the pipeline?’ The 4,000 open tech jobs we can’t currently fill, the pipeline is going to come from other types of areas, including a diverse pipeline,” she said.

The growth reflected in the number of Utah tech companies expected to go public comes with its own set of challenges, Betts said. They include extending access to opportunity for everyone and dealing with rising housing costs and poor air quality.

“This success is not going to extend to everyone. We’ve seen this play out before in Silicon Valley,” he said. “Right now, if you don’t work in tech in Silicon Valley, you no longer live in Silicon Valley. You’ve been priced out of everything that’s happening there.

“So, it’s incumbent on everyone up on this stage and everyone in this room to think about how do we extend access to opportunity for everyone – not just the folks living along the Silicon Slopes corridor and the Wasatch Front but to folks in rural Utah and the 347,000 kids in the state of Utah who live at or below the poverty level? And that’s a huge number with only 3 million of us in the state of Utah.

“What we’re about to experience is unprecedented. And it’s crazy, what’s about to happen inside of our tech community. But we as a community need to avoid some of the pitfalls that have happened in Silicon Valley and think through these issues of ensuring that success is at least extended and the opportunity that exists within our community is democratized.”

Sara Jones, Women Tech Council co-founder, called for more internships and boot camps to boost the number of women in the tech industry. “We spend so much time talking about importing talent into our state, and there’s a ton of talent in the state that’s trying to grow, and they need that opportunity,” she said.

Kelly Slone, president and CEO of BioUtah, said she hopes to see more capital focused on life sciences. Other panelists discussed the need for the various organizations to work together to address issues facing the state’s tech industry.

“The thing that makes an ecosystem great is when you can leverage the strengths of all of the respective talents around the table,” Tetro said. “We’re all going to have different programs and things that we take on, because we know how to do those well. But we have to leverage the intersections to really engage the collective talent that makes us better.”

Betts suggested every organization focus on “what’s best for the community?”

“It’s the big kind of ‘moon shots’ for our organization and for everybody on this stage that I think we should be focused on, because these challenges that we’re facing as a community is because of our success,” Betts said. “It’s because we’ve built great companies that we get to think about things like ‘how do we have a more-diverse workforce’ and ‘how do we help solve air quality and transportation and recruiting and all of these types of things?’”

Asked what the next decade holds for Utah’s technology sector, Knotwell said he foresees burgeoning tech hubs in Washington County and increased innovation in Iron and Carbon counties and Cedar City, plus organizations in Logan taking advantage of the tech growth happening along the Wasatch Front. That can be enabled by Utah companies that are willing to create something innovative and scalable, he said.

“You can put a remote office in Price tomorrow and be completely connected to your home base in Salt Lake City, if that’s where you are,” he said. “Whereas the heart of Silicon Slopes beats today probably along the Wasatch Front, I think in 10 years the arteries that exist along the rest of the state get much, much stronger.

“It’s going to be amazing to watch,” he said of the tech expansion into rural Utah. “Over 10 years, what today represents 10 percent of our workforce in tech might to be 20 to 30 percent of our workforce in tech.”

Jones said she hopes to find ways to keep STEM-educated women from leaving the state. Ninety percent of women with STEM-related college degrees are doing that, she said.

“There’s lot of reasons that they’re are leaving, but I guarantee they are things that we can do things about, if we’ll be really deliberate and really intentional about it, and keep that talent in our state,” she said.

Tetro said the state’s tech sector will “look different” in 10 years but also have great opportunities. The foundation must be put in place to ensure the sector’s continued growth, she stressed.

“Because in 10 years, we want a different set of problems to be here. We want a different set of growth opportunities to be sitting in front of us. I think that only happens when we all try to lay the right foundation,” Tetro said.

“In 10 years, we won’t look the same. I actually hope that in 10 years we’re not having a diversity conversation anymore — [that] it’s a given, that the world is different for our kids than the world that we’re in. That’s the world that we hope for and that we’re solving an entirely new set of challenges that sit in front of us because of the introduction of new issues of growth that are facing our economy.” {/mprestriction}