Progress 2012: Terakeet Corp in downtown Syracuse has tripled its workforce in 3 years
Back in ancient times — before TV, that is — the phone company was the Internet, and the Yellow Pages functioned as Google. To get noticed, you bought a full-page ad or leap-frogged the competition alphabetically, by changing your name.
Thus was born a generation of companies titled “AAA” — arguably, the first search engine optimizers.
Today, Google guards its search engine algorithms the way KFC protects its 11 herbs and spices, and to get noticed on the Internet requires more than an “A” in your name. Also, the stakes — being listed not to a city but the world — were never greater.
And the job of influencing those Google searches could be the future of downtown Syracuse. Yes, you read correctly: This is an Internet story — not from Berkeley or Boston, but Syracuse. Downtown Syracuse.
There, an 11-year-old company, Terakeet Corp., has tripled its work force in three years, expanding its national footprint and crystallizing the urban renaissance fantasies that have been touted for decades by local political and business leaders.
In Armory Square, the company’s 33-year-old co-founder says the growth is just beginning.
“It may sound crazy,” chief executive officer MacLaren Cummings said recently. “But I think that we have the capability, if we make the right steps, to make this a billion dollar company in the next five to 10 years.”
Billion. Ten years. Crazy, or what?
Three years ago, the company had nine employees. Now, it has 32, estimated revenues in the tens of millions and an A-list of national clients, such as Coca-Cola Co., American Express Co., NBC Universal-Orlando and General Electric Co.
Plus, it has friends in high places. Really high places.
Four years ago, Cummings carved out a reputation as the search engine guru who helped transform Hillary Clinton’s presidential campaign website into a fund-raising powerhouse. He signed on for a three-day stint. That lasted several months, working without compensation. After Clinton left the race, Cummings was snapped up by the Obama campaign, again footing his own bills.
He’s been called back to work for the president’s re-election, consulting in a campaign whose total cost could hit more than $1 billion.
Nevertheless, Cummings says his work for Obama won’t pay off in dollars, but in business contacts. Be they Republican or Democratic, captains of industry generally figure the guy who helps run a presidential campaign website knows what he’s doing.
“There is a certain prestige involved with being part of a political campaign, especially one that is regarded as highly technical,” said Cummings, a Tully native who attended Manlius-Pebble Hill High School and graduated from Cornell University in 2001. “There is a certain sizzle factor with potential customers. … The fact that a campaign of that magnitude would hire a firm like ours, I think, says something.”
On South Clinton Street, Terakeet quietly has expanded to take up two stories of the Neal and Hyde Building, which is mostly known for its ground floor, the Syracuse Suds Factory. But within the area business community, the company’s profile has soared.
“It’s part of the foundation for our future growth,” said Rob Simpson, president of the Center State Corp. for Economic Opportunity, a regional business organization. “You have a young entrepreneur who started here and is growing his business here. … They’re growing and expanding, doing everything right.”
But Terakeet didn’t happen overnight. At times, Cummings’ business career has resembled a state fair midway ride. From his Cornell dorm room in 1998, he launched Mindshark Software and Consulting, a company that engaged clients such as Forbes Magazine and grossed $500,000 in revenues by his junior year.
In 2001, he and former classmate Patrick Danial co-founded Terakeet, based on a voice-recognition software they hoped would revolutionize business call-centers. Angel investors sank $600,000 into the product, which inspired the company’s rather strange name: They noticed that receptionists often parroted the words of callers, so they mashed-up the computer jargon — terabyte — with parakeet.
“When you’re 18, it seems really cool to come up with a name nobody has heard before,” Cummings explained, with a shrug.
Their software worked. Unfortunately, it also tanked.
“The dog just didn’t like the dog food,” Cummings said. “We learned a valuable lesson: Just because customers all say they want something, it doesn’t mean they are all going to buy it.”
That lesson nearly crushed them.
“I was very depressed, because so many people originally had told us no, that it was a bad idea,” Cummings said. “They had given us all these reasons why we wouldn’t be successful — and frankly, they were right about a lot of it. But they didn’t give us credit for one thing: We’d started with absolutely nothing. … And they didn’t consider that we would just get up and keep trying.”
Despite its lack of buyers, their software had created a respectful buzz within the technical community, and they had made business contacts. Around this time, companies with big Internet websites were wrestling with a burgeoning issue: How to get noticed on Google.
It was the Yellow Pages, all over again.
They turned to the art of search engine optimization, or SEO, an industry that began around 1997 and has evolved steadily since.
By 2004, companies of all sizes recognized that their huge online investments hinged on the apparent die-roll results of Google keyword searches. Score high on page one, and you’d receive the traffic. Land on page three, and you were buried in the avalanche.
Moreover, if something negative stained your reputation — even if it later proved false — the accusation might pop up high on Google every time someone searched your name.
In 2004, Terakeet jettisoned its voice software strategy and leaped into the emerging market of influencing Google searches.
Last year, the Google Inc., which is based in California, generated $25 billion from search engine advertisements — the shaded links that appear atop most search results.
But those ads represent only 15 percent of the overall traffic. Nearly 9 out of every 10 viewers click on sites that rank high on the first page — unadvertised.
To make a splash on the web, being there is everything.
Nationwide, thousands of companies offer SEO services with a wide variety of tactics. The so-called “black hat” consultants — frowned upon by the industry — use tricks and deceptive techniques to boost traffic. They’ll embed invisible key words on a site or send spam emails to the masses. Neither approach suits the needs of a corporation.
The “white hat” companies, like Terakeet, basically try to win the Google rankings by earning them. They constantly monitor Google’s algorithms, which take into account billions of variables.
Terakeet uses its own software to identify relevant blogs, websites and social media, then assigns teams of “link ninjas” to engage with them. The teams create relationships between sites, drawing visitors to and from them, resulting in traffic that enhances its Google presence. In certain cases, Terakeet creates new content.
“We have access to a wide array of writers who can develop content for us and our clients very quickly,” Cummings said. “That provides us with an advantage. We’ve gotten large enough so if we can’t write the content in-house, we can access someone who can.”
Despite a down economy, the company has steadily grown, and it is measuring the floors with plans to add to the work force. Last year, to enhance its visibility, Terakeet hired Brian Dalton as vice president of sales and marketing, luring him from the web giant Adobe Systems Inc.
Last month, the company contacted all 13 of its original angel investors, the friends and family who 11 years ago financed the voice software, with an offer out of the blue: Would they like their money back, several times over?
“When the product failed, I think the sentiment among most of them was that they had lost the investment,” Cummings said. “With some, not only were they surprised to get a premium on the original money, they were surprised we were still in business.”
Terakeet bought out the original investors and prepares to move forward. The future looks wide open.
“Right now, you have a convergence of platforms — the phone, the television, the laptop, the iPad — devices that are all starting to look and function like the same thing,” he said. “Televisions are going online, newspapers are printed online, you’ve got an iPad where you can read a news magazine. All of these convergences are occurring both on the web side and on the device side. It’s all happening at once. There are huge opportunities right here.”
Yes, you read correctly: He meant in Central New York, not in Southern California.
“One of the biggest things I’m proud of is that we’re located in Syracuse,” he said. “The majority of these firms are in Washington, D.C., or Virginia, or the Silicon Valley. The fact that we’re here in Syracuse and working not only with the Obama campaign, but with firms in Boston and New York City, and firms like Universal Studios in Florida, and all over the globe — I think it says something special about what we do.
“Nearly all of our employees are under the age of 27,” he continued. “We’re hiring people out of Syracuse University, LeMoyne College, Cornell, SUNY Oswego. We’re doing what the economic development people and the mayor are trying to figure out how to do: to attract young people and keep them here. … We’re going to continue to do it. We’ll do it organically, right here.”
And to get attention, they won’t change their name.