North Carolina Economic Development Guide

2017

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52 N O R T H C A R O L I N A E C O N O M I C D E V E L O P M E N T G U I D E C harlotte's AvidXchange is one of the nation's fastest growing fi nancial-technology companies and already making a big mark on its hometown, with a majority of its 800 employees based there. "They are the poster child for fi ntech innovation and what we want to do in Charlotte," says Dan Roselli, founder of Packard Place, a local business incubator. Michael Praeger and David Miller started the business in 2000, just as the dot-com bubble was bursting. It grew modestly in its fi rst decade as technology was modifi ed and its business strategy adjusted to meet customer demands. Millennials moving into senior fi nancial posts don't understand why they pay bills in their own personal accounts via the internet, while so many businesses retain paper-based systems, Praeger says. "There was all of this noise around online bill payments involving consumers. But there wasn't much talk about business bill payments." During its fi rst 14 years, AvidXchange raised about $20 million, mostly from founders, private individuals and a former Charlotte venture-capital fund. Then, in 2015, the company attracted $225 million from some of the most successful U.S. tech investors: Bain Capital Ventures, Foundry Group, NYCA Partners and TPG Special Situation Partners. Board members of the growing company include Nigel Morris, a co-founder of Capital One Financial and Hans Morris, a former president of Visa. A Wisconsin native, Praeger and his wife, Cindy, picked Charlotte as a place to build a business after tiring of the weather in Boston, where he worked for a venture- capital company and later started and sold two tech businesses. About two years after starting the fi rm with Miller, who retired in 2011, they added a software feature to help automate accounts payable processes at small and midsized businesses. It took time to catch on as Praeger built a sales force and customers learned the product's benefi t. Now company revenue is growing by more than 60% annually. AvidXchange focuses on the 340,000 U.S. businesses with annual sales of $5 million to $1 billion, providing awesome growth potential, Praeger says. In 2014, the company spurned a South Carolina incentives off er, opting for a $10 million package from Charlotte and North Carolina that hinges on hiring 603 people from 2015-18. To help attract young, tech-savvy workers, AvidXchange is building its headquarters at the N.C. Music Factory a mile north of downtown Charlotte. The new six-story building will have room for 1,000 people when it opens in mid-2017, including a mix of tech specialists and support services. Across the street from the new building sits a collection of bars, restaurants and entertainment venues in rehabbed textile manufacturing space. "Creating a good work and life balance is important," Praeger says. "We asked if we were creating the right space where [employees] want to spend so much of their time." Charlotte is an excellent place for AvidXchange to grow because its labor costs are lower than Boston, California and other tech centers, says Matt Harris, managing director of Bain Capital Ventures. In the major cities "scaling to 1,000 people is prohibitively expensive. Charlotte has a depth of high-quality talent and there is a great work ethic." Praeger has the skills to turn AvidXchange into a well-known tech leader, Roselli says. "Like all good entrepreneurs, Mike is focused and tenacious. He is scrappy and just fi nds a way to get things done." F I N A N C I A L T E C H N O L O G Y CHARLOTTE'S PROMISING FINTECH LEADER AvidXchange:

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