An unusually stringent approach to hiring is paying off for David Vinson. Potential employees at Optate Inc., a 22-member Ann Arbor, Michigan-based online employee-relationship management firm formed by Vinson in 1999, must agree to several tests before they are considered for employment. This includes personality assessment screenings to determine each individual’s risk tolerance and willingness to take on challenges.
This approach to staffing paid off when it came time to seek financing. Vinson, a former senior executive at Blue Cross/Blue Shield of Michigan and the University of Michigan Health System, went to both private investors and institutional firms and convinced them that Optate was a well-managed company with a viable business plan. After raising $350,000 in seed capital from angel investors in July 1999, Optate’s series A round of financing closed in June 2000, led by Internet Healthcare Group, which invested $6 million. Proceeds were used to recruit key team members and continue investing in technology. The series B round, totaling about $6.5 million and led by several venture capitalists, closed in September 2001, and is being used for sales and marketing and hiring additional employees.
Vinson says his hiring measures are a result of witnessing greed back when initially staffing the firm. “It was smack in the middle of the new economy movement and a lot of people were looking at my company as a get-rich-quick scheme,” explains Vinson, CEO, founder, and president.
Despite the strictness of the tests, workers remain loyal to the company. In some cases, potential employees were offered lower base salaries in return for an equity stake in the firm.
Vinson, who says his firm isn’t facing any economy-specific challenges, remains positive about the long-term outlook and expects to increase his workforce to 32 members by the end of 2002. He sees profitability by mid-2003 and forecasts sales of $1.7 million and $7.5 million for 2001 and 2002, respectively. Although his is not a get-rich-quick dotcom scheme, Vinson hopes his employees will remain satisfied with building and expanding a business with long-term potential
Optate Inc., 912 N. Main St., Ann Arbor, MI 48104; 877-643-6287; www.optate.com.