At some point, Kelly Pfledderer will have to make a tough decision. He’s pondering the problem as he bounces a basketball in the gym of Apparatus, his information-technology firm in Indianapolis. He holds his dribble, rests the ball at his waist, and tries to explain his quandary.
“If you’re going to work 40 hours a week somewhere, you might as well enjoy yourself a little bit,” he says over the lingering reverberation of the basketball. “And we’re in real competition for talent. It’s a battle.”
Before he moved his company into the building in 2011, this cavernous space was a television studio. A bottom-line business owner might have looked at the big empty room and seen two entire floors of cubicles, conference rooms, and buzzing fluorescent lights: workspace—lots and lots of workspace.
But when Pfledderer embarked on Apparatus’s $1 million remodel to transform the property into a sleek, contemporary showcase for the fast-growing tech venture, he looked at the wide-open studio and saw a basketball court. So rather than fill it with office furniture, he had the overhead ductwork removed to clear room for arcing three-point shots.
Having hoops instead of more cubicles might not have been the most conventional move, but to Pfledderer it made the best business sense. As a managed-IT company, Apparatus helps clients keep their computer networks, information systems, and websites running smoothly. Apparatus solves problems, many of them unique to whatever company it might be working with. It relies on technicians and engineers and others who are not only skilled enough to make fixes, but also flexible and creative enough to devise novel solutions—problem solvers.
And to attract those people, Pfledderer has to provide an environment where they want to be. In today’s information economy, as author Richard Florida has famously noted in The Rise of the Creative Class, recruiting in-demand techie types requires cool workplaces with bells and whistles like, say, basketball courts.
So here’s the dilemma. When Pfledderer started Apparatus in 1999, it had exactly one employee: him. Now it has more than 140 employees. The company’s workforce has increased by about 30 percent every year for the past seven years, even in the lean years following the 2007 downturn in the U.S. economy. In 2012, after Apparatus enjoyed 160 percent revenue growth over the previous three years, Inc. 5000 named the Indianapolis firm one of America’s fastest-growing private companies—for the fourth year in a row.
In the not-so-distant future, as Apparatus rolls out a national growth strategy and continues to add people to keep up with the burgeoning business, its offices, cubicles, and conference rooms are going to fill up. And Pfledderer will look at the full-court gym where he’s now shooting baskets on a work break and see in its place more cubicles and conference rooms.
“If we had to, this could be office space,” he says. “But I’ll protect it for as long as I can.” A sly smile spreads across his face, and he launches another shot toward the rim. “This sure is fun.”
Kelly Pfledderer’s current role as hard-charging entrepreneur doesn’t seem to jibe with his soft-spoken, easygoing demeanor. You’re more likely to find him in jeans than a suit around the office. And it is true that serendipity played at least some role in his success. He spent his first five semesters at Wabash as a biology major in the hope of becoming a physician.
But when he returned for his senior outing after spending part of his junior year studying in Germany, he learned that none of the courses he took overseas would count toward a science degree. Just like that, being a doctor was out.
But Pfledderer regrouped. He learned that he could still graduate on time by changing his major to German. And any disappointment gave way to the realization that medicine wasn’t really his calling, anyway.
“Being a doctor was probably something I thought I should do, not something I wanted to do,” he says.
What he wanted to do was work with computers.
Pfledderer’s father was a teacher in Crawfordsville who always had computers around the house. Their next-door neighbor, Professor of Biology Bill Doemel, had become head of computer services at Wabash, and Pfledderer and Doemel’s son, Chris, started playing around with computers. When the Internet was in its infancy, the two boys were linking up with 1200-baud modems and chatting on local bulletin boards. After Pfledderer got to Wabash, he took a job with Computer Services and played a critical role in wiring the college’s campus-wide network. By the beginning of his junior year, Pfledderer was going off-campus to service computers and set up networks for local doctors’ offices.
“When I first got paid to fix somebody’s computer, that was an a-ha moment,” he says. “I thought, Oh my god, someone’s going to pay me to do this. I just never thought about it as a career until I got to college: You can do this for a living.”
After graduation, Pfledderer stayed at Wabash to work in Computer Services for two years, then signed on with a large tech-consulting outfit in Indianapolis. He soon found it too limiting.
“At Wabash, I got to be involved in network deployment, computer support, working in the lab, server hardware,” he says. “You got to learn everything. At a big company, it’s very narrow: Here’s what you do for us. The big corporate IT companies are like that. Employees get siloed. I wanted to get back to doing lots of different things, to having that breadth of experience. I thought the best way to do that was to start my own company.”
In 1999, Apparatus was born.
In the beginning, the company that would one day get a shout-out from Inc. was an army of one. But demand for computer help quickly outpaced Pfledderer’s ability to keep up. Before long, he was bringing more hands on deck—first his brother, and then in 2001 he hired several more employees. Things were rolling. Pfledderer went from working out of his house to leasing a tiny downtown office to filling a 6,000-square-foot facility in the span of a few years.
As Apparatus grew, Pfledderer found a niche. With its emphasis on hiring the most talented programmers and engineers available, the company had a versatile, adaptable workforce, one that could create highly individualized, full-service IT solutions for the highly complicated and ever-evolving digital needs of Central Indiana businesses. Apparatus could tailor services in a way that giant firms like Hewlett-Packard and Unisys, with their more cookie-cutter approaches, could not. “With our service, we can’t afford to go get a big client and mess anything up,” says Pfledderer. “IBM can go blow up an account, and they probably don’t even notice it. That would really hurt us. We’re accountable for the services we deliver.”
But it wasn’t until the Super Bowl in 2004 that the value of the Apparatus approach really hit home. He was sitting in his living room on the near-north side of Indianapolis, surrounded by several employees. It was a Super Bowl party, of sorts, but typical only in that everyone assembled was glued to a screen. It wasn’t the outcome of the game, nor a television screen, that enthralled them. They were staring at computers.
In the weeks leading up to the game, Apparatus had taken a call from Eli Lilly and Company. The Indianapolis pharmaceutical giant was gearing up for a multimillion- dollar ad campaign for its blockbuster erectile-dysfunction drug Cialis (featuring the infamous couple-in-two-bathtubs trope), set to air during the NFL’s marquee event, and the plan was to include an Internet address for a product Web site.
In theory, building out the infrastructure to handle the sudden onslaught of web hits on a site with Super Bowl exposure should require months of work—which is what the first IT company Lilly had hired for the job got. But when that firm fell short, Lilly turned to Apparatus. And they wanted to know whether the homegrown service provider could turn around the project in two weeks.
Loath to miss out on the opportunity, Pfledderer took the job—with serious reservations. It was a major undertaking with not nearly enough time. Succeed, and Apparatus had a shot at landing more business with Lilly and other big-fish companies. Fail, and, well, the joke practically writes itself.
“It felt like a huge risk,” says Pfledderer. “If it doesn’t go well, not only is it going to be funny, it’s so funny
it’s going to make headlines.” Company Hired to Launch Erectile-Dysfunction Website Can’t Keep It Up.
Pfledderer’s team worked day and night leading up to the big game, setting up remote servers and backup servers—“redundancy,” they call it—to ensure that if one couldn’t handle the traffic, another would take over seamlessly. As Pfledderer anticipated the first airing of the Cialis spot, tension in his living room ran high.
“It was the most nervous Super Bowl I’ve ever had,” he says. “You would have thought we were playing in it.”
He and his team sat ready to scramble if the Web site crashed. But it never did; Apparatus had come through in a pinch. Cheers and high-fives went around the room.
Now about 40 of Apparatus’s employees spend most of their time onsite at Lilly, and Pfledderer’s company has become a go-to IT provider for a host of central Indiana’s most prominent companies and institutions, from Indi-anapolis Motor Speedway—for whom Apparatus helps maintain sophisticated real-time scoring data made available to IndyCar fans during races—to ChaCha, the text- and web-based answer service founded by legendary tech entrepreneur and voicemail inventor Scott Jones.
These days, Pfledderer is more manager and deal-maker than the tech geek he started out to be. But he’s happy to let the highly skilled people he hires (many of them Wabash grads) handle the nitty-gritty. “I don’t get much hands-on work anymore,” he says. “In fact, most of the guys here make fun of me, like I’ve lost my edge. ‘Why would you need that logon info?’ they ask me. They’re thinking, He doesn’t need access to this. He hasn’t done this for a long time.”
It’s probably just as well, because Pfledderer has his work cut out for him steering Apparatus through its next phase: expanding the company’s reach to a national client base. To help make that happen, Pfledderer enlisted current president Aman Brar, who, since graduating from Wabash in 1999, has already become something of a grizzled tech-industry veteran. An economics major, Brar left Crawfordsville to intern under Bob Knowling ’77 at broadband provider Qwest Communications in Denver, then followed Knowling—praised by former President Bill Clinton for his efforts at expanding high-speed access in low-income communities—to Covad Communications in Silicon Valley. Brar finally landed back in Indianapolis, where he worked for Guidant Corporation, which develops pacemakers, and the aforementioned ChaCha, where Brar orchestrated the firm’s first seven-figure deal.
Brar and Pfledderer became acquainted at the weddings of mutual friends from Wabash, and they became fast friends while talking shop. In Puerto Rico, as Brar, then at ChaCha, frequently excused himself from reception festivities to take calls from the office, Pfledderer teased him about working for the famously indefatigable Scott Jones. “Kelly gave me a hard time about the 2 a.m. phone calls from Scott,” Brar remembers. “He asked me, ‘Are you ever going to get off the phone?’”
In 2009, Brar was ready to work for ExactTarget, another fast-growing Indianapolis tech company. The weekend before Brar was set to sign with the firm, Pfledderer asked him to meet for coffee. He made a case for Apparatus, and Brar liked what he heard.
“He was so optimistic about the future,” says Brar. “In my core, I’m happiest when I’m building, moving things forward. At Apparatus, the script hasn’t been written. I saw in that a more daring career opportunity.”
Now Brar is perhaps the company’s biggest cheerleader, with a gift for using metaphor to explain to prospective clients the complicated, technical nature of what Apparatus does. “When you run your own household, you do a lot of things with water,” he likes to say. “You turn the faucet and water comes out of it. But imagine if you, as the chief executive officer of your household, had to think about how the water gets to your house. Think about all of the infrastructure, and imagine how many people have been involved in the successful delivery of water to your faucet. But the way water is delivered is pretty consistent and standardized. The IT space, on the other hand, is changing all the time. If I’m engaging with the leader of a business, I ask, ‘Can you look me in the eye and tell me that worrying about how the water gets to your faucet actually makes a lot of sense for you and your company?’”
It’s that kind of common-sense sales pitch that Brar and Pfledderer hope will fuel the company’s continued growth as they colonize more and more cities with satellite offices. Brar anticipates that in three or four years, Apparatus will be a “sizable firm” doing $40-plus million in business annually.
The challenge will be figuring out how to grow while holding on to the virtues that have made Apparatus successful in the first place. The company’s primary competitors are giants, and to compete with them, Apparatus is attempting to create a new category altogether: the managed-IT firm that provides high-end, personalized services with style, quality, and seamless design.
“We don’t have scripts of what you’re supposed to say to the client when they call with a particular issue,” says Brar. “We want employees to bring their ingenuity to the table. We’re taking risks on our people that we don’t think our competitors are willing to do with theirs, which is why I think we’ll ultimately deliver better results than our competitors as we grow. That’s the trick, right? How do you evolve and maintain a culture so we can always allow ourselves to do that?”
“We want to be the Nordstrom of the IT space, not the Kmart.”
Pfledderer takes another shot in the gym at Apparatus headquarters. The ball bounces off the rim, falls to the court, and rolls to a stop in the corner. He has a lot on his mind—like trying to figure out how to scale the corporate culture that has made Apparatus a home for the highly skilled, highly sought-after tech people capable of delivering the “Nordstrom” level of service Brar talks about. Some day soon, as Apparatus continues to expand, Pfledderer might have to turn this basketball court into cubicles, conference rooms, and buzzing fluorescent lights. But if the court symbolizes the “cool” workplace, Pfledderer is confident that it is only that—a symbol. He is confident employees will stick around because Apparatus challenges them and offers the opportunity to shape their own careers—just as Pfledderer has done.
“We talk a lot about people development and cultures,” says Pfledderer. “But it’s not about the gym or the espresso machine. It’s about people. If those things allow you to get those people at first, fine. But they’re not going to stay for the basketball court. They’re going to stay for the people they work with.”
Besides, at the rate Apparatus is growing, there might not be enough time for basketball, anyway.