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How Tech Powers Kansas City's Economy

How Tech Powers Kansas City’s Economy


Fact: KC is a tech-driven town. If we’re going to stay one, a few things need to change.

There’s a question Ryan Weber likes to ask people: What is Kansas City’s biggest industry?

How about transportation and logistics? Finance? Manufacturing? Maybe animal health?

“Nobody ever says technology, and until that changes, it’s going to be hard to prove to the rest of the country that we are the tech hub of the Midwest,” said Weber, who heads up the KC Tech Council, a nonprofit that supports the metro’s technology sector.

In reality, technology is one of the largest employers locally, said Weber, whose organization helps promote Kansas City to IT professionals thinking about moving here.

Tech jobs make up 8 percent of Kansas City’s private-sector workforce, according to industry association CompTIA. Nationally, tech jobs are 5.7 percent of private-sector employment.

The region added 1,236 tech positions from 2014 to 2015, a 1.9 percent increase. Demand was higher for certain types of positions. Hiring for app developers and systems analysts increased by 5 percent or more.

Expansion at All Levels

Part of that growth is coming from the metro area’s most prominent companies, many of which happen to be tech-focused. Cerner’s new campus in south Kansas City will have room for 16,000 employees by the time it’s finished. Garmin is expanding its Olathe headquarters, which could create room for another 2,700 workers.

But there’s been noticeable growth among smaller and medium-size tech firms, too.

Take k12itc, for example. The Northland company offers IT services to school districts in seven states. In six years, it’s gone from three employees to 35, with annual revenues north of $7.5 million last year. This spring, it was named the 2016 Small Business of the Year by the Greater Kansas City Chamber.

Veracity Consulting, an IT consultancy based in Lenexa, rocketed from around 30 workers in 2011 to nearly 90 today. Another Lenexa firm, Technology Group Solutions, was rated one of the fastest-growing women-owned companies in the nation by the Women Presidents’ Organization.

“Kansas City is a great location for technology,” said Krista Sandt, k12itc’s director of sales. “The technology community here is extremely supportive, and being a part of a network that promotes entrepreneurial growth, innovation and strategic partnerships is what continues to grow both the city and our company.”

And you can’t escape the string of local tech startups that have won national attention, including EyeVerify, blooom and Farmobile, an ag-data company that closed a $5.5 million Series A round late last year and has been covered by the Wall Street Journal, TechCrunch and Fortune.

Lawrence’s Mycroft will soon begin shipping its voice-controlled AI devices for the home—like Amazon’s Echo, only open source. The startup has raised about $500,000 through various methods, including a successful seed round and the single largest Kickstarter campaign in Kansas history.

Ryan Sipes, Mycroft’s chief technology officer, said it’s still challenging for tech companies to secure local funding, but “I think that the Midwest and specifically Kansas City is really coming into its own when it comes to technology startups.”

Mycroft was part of the most recent Techstars class at Kansas City’s Sprint Accelerator. Sipes’ team sharpened their concept and got firsthand advice from executives at Amazon, Sprint, Cerner, VML and other major corporations.

“This past six months has been a transformation from a fun project into a true business,” he said.

Still Work to Do

The KC Tech Council created a national website, www.ChuteKC.com, to publicize Kansas City tech jobs and the companies offering them. While the major employers have a presence on Chute, about 75 percent of those represented are smaller companies, Weber said.

“In our experience, the tech sector is growing regularly,” said Monica McAtee, local branch director of The Nerdery, a Minneapolis firm that expanded to Kansas City in late 2014. The company specializes in custom software design and development.

“The growth is coming from new startups and midsize companies choosing KC as their city of choice,” McAtee said. “I don’t think a day goes by where I don’t read an article or have conversations about various tech companies in different phases of their growth. I also see local corporations growing their technology, which requires growing their teams.”

Kansas City offers advantages that make it a good place to locate a tech-based company. For starters, the city has access to several carrier lines, ensuring solid Internet connections. It’s known as an attractive place for families, and the cost of living is lower, which is nice.

But there’s a big problem that Kansas City needs to confront, Weber said. The city might be home to a higher percentage of tech jobs than the national average. Unfortunately, it’s not keeping up with the national rate of growth in tech.

Remember how Kansas City saw tech employment increase by 1.9 percent from 2014 to 2015? During the same period, the United States as a whole experienced tech growth of 3 percent.

True, Kansas City grew, Weber said, “but it’s certainly nothing to clap about.” Many of the region’s peer cities are experiencing bigger gains in tech hiring.

It’s not because those cities have more opportunities, he said. They’re just better at filling their positions.

The Need for Senior Staff

The demand is greatest for people who can serve in mid-career and senior-level roles. Programs like LaunchCode can help newcomers acquire entry-level skills, but most of Kansas City’s open positions tend to be further up the career ladder.

Too many out-of-town job-seekers don’t know anything about Kansas City beyond our barbecue and baseball, Weber said. They aren’t aware of the different companies based here.

That’s an important piece of information for people who are uprooting their lives and moving to a new city. Even if they accept a job with a Kansas City firm, they want to know there are other opportunities available here in case that first job doesn’t work out.

Mike Talbot is a program director with Veracity Consulting, heading up its data services unit.

Kansas City needs to stay focused on building up its tech infrastructure and getting more of the local youth interested in tech, Talbot said. But he added that Kansas City already is home to a wealth of fantastic resources, whether its great food and sports or tech-based meetups and conferences.

“So when you add all that up, why would I go to the West Coast, why I would go to the other traditional tech hubs, when I can have all KC has to offer, including low cost of living, and still be on the cutting edge?”

James Hart

Written by

James Hart is a freelance writer based in Kansas City.

Categories: Building KC, Tech


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