Read the best warts-and-all example of how start-ups land government contracts.
Earlier this year, a tiny, unproven startup landed a $3.5 million military contract for a computer system to help veterans find civilian jobs. For the company, the deal was a lifeline, but securing the contract was anything but simple.
The story of how it happened--that is, how an ex-Marine launched a new company and obtained his first federal government contract barely a year later--was first reported by Greg Jaffee in The Washington Postand lays the federal contracting process out as well as anything I've seen.
Would it help your business to add the federal government as a customer next year? Read on to see how he did it and then decide for yourself.
Meet the Founder
Chris Taylor, 47, spent 14 years as an enlisted Marine and left active duty for business school just before the attacks on September 11, 2001. He then became a successful executive at the controversial defense contractor Blackwater during the height of that firm's success.
A note on Blackwater: It brought in more than $1 billion in government contracts during the Iraq War and was so controversial that when Taylor applied to Harvard's Kennedy School of Government in 2007, the school weighed whether he should be disqualified for ethics reasons because its name was on his resume.
Ulimately, Harvard admitted him and Taylor rose quickly to become chief executive of another defense firm. Then he struck out on his own, putting $300,000 of his personal savings into a brand-new, would-be contractor called Novitas.
His plan, according to the Post, was "to work his connections, hire the right people, and find something big." At the time, the government was still spending nearly $200 million a day on contracts in the Washington area. But while most people didn't have the contacts or insider knowledge, Taylor did.
Move Fast and Make Friends
His big break unfolded over the following months. First, he partnered with a software company building a product, then he showed a prototype, VetConnect, to a colonel at U.S. Special Operations Command in Tampa, Florida.
Within days, Taylor secured an invitation to present at the command's annual industry conference. But while he wasn't an insider and lacked the connections of a four-star general or Cabinet secretary, those were just the kind of people he associated with.
In fact, when someone asked during a presentation when his site would be ready, he said he wasn't sure but "sought to bolster his credibility by not-so-subtly mentioning his dinner the night before" with a retired admiral who had once run the same command sponsoring the conference, said The Post.
Find Your Legal Advantages
While waiting for the government to bite, Taylor pitched the same software to a top retail chain that had pledged to hire veterans. A top company executive who was unimpressed politely told him there was "no likelihood" they would ever work with him.
But Taylor needed the break, for he was burning through his savings. Two months after his pitch at the special operations conference, the government's request for proposals arrived. It was "pretty much made for Novitas," said ThePost, since it required the kind of technology Novitas was using.
The request required that the award-winning firm be owned by a disabled veteran. Since Taylor had jumped out of airplanes in the Marine Corps and suffered a bad back and sore knees, he fit the bill. With his special designation as a service-connected disabled veteran, that all but sealed the deal.
This was a huge contract for Novitas, and not just because it meant revenue. Executing one successful government project is often a pre-requisite for landing more.
Experts at the Small Business Administration and elsewhere say the more common way around this problem is buliding a track record first by working as a subcontractor for a larger, established firm that tends to work with the government.
In theory, every government contract is supposed to be listed on www.fbo.gov, known colloquially as "Fed Biz Opps." But if getting contracts on your own seems too far a stretch, this might clue you in to the contracts that larger entities might land and where to reach out to them.
Nobody Said This Was Pretty
As one Post commenter put it, Novatis's story represents "the worst about Washington all in one article. [M]ilking contacts from previous government jobs ... Nothing about actually getting a job done, or providing value and expertise to the government at a reasonable price to accomplish the government's mission..."
I don't know if VetConnect actually works or if any veterans will get jobs as a result of using it. But the point here is that nobody promised the process was pretty. If you want to compete for government contracts under the current system, this is a pretty good, warts-and-all case study in how it's done.