February's Venture Out at Health Diagnostics Laboratories was a huge success with record-breaking attendance and spirited conversation. Thanks to our host HDL and to our speaker Lee Downey. Thanks also to the City of Richmond for sponsoring the event.

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Also, don't miss on exciting upcoming events. Learn more and register now.

By: John Reid Blackwell | Richmond Times Dispatch
Published: February 06, 2012 Updated: February 06, 2012 - 12:00 AM
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The packages start to arrive at Health Diagnostic Laboratory Inc. at about 7:30 a.m. daily.

Thousands of blood samples from physicians' offices across the country come to the HDL labs in the Virginia BioTechnology Research Park. There are so many, the company has its own FedEx mailing code.

"We run about 60,000 tests a day," said Tonya Mallory, HDL's president and chief executive officer. "We have been growing at a rate of about 5 percent a week for the last 23 months."

HDL provides diagnostic testing and services that help physicians improve patient treatment through a personalized health plan. The company's tests provide early detection of risk factors for cardiovascular disease, diabetes, metabolic syndrome and fatty liver disease. HDL also provides health counseling for patients to reduce those risks.

Opened in 2009 with just a handful of employees, HDL has seen phenomenal growth. It now provides testing for physicians and medical practices in 45 states. It employs about 425 people, and is still adding jobs.

Mallory said the company's revenue is projected to reach about $250 million this year.

"I have never seen a company grow as quickly and with the kind of dynamic growth and success that (HDL) has had," said Robert T. Skunda, president and chief executive officer of the park.

Skunda said the company has tapped into a market helping doctors and other health care professionals provide counseling for their patients.

"That is really what HDL is doing," he said. "They are not only providing test results, but they are really an adjunct to the health care provider, helping the physician and patient both monitor and improve their progress."

In November, the company announced plans for a $68.5 million, two-phase expansion in 2012 and 2013 that will demolish two buildings along Jackson and North Fifth streets in the Virginia Biotechnology Research Park undefined BioTech 3 and BioTech 5 undefined and replace them with two six-story buildings. Those buildings will connect with HDL's existing home in the three-story BioTech 8 on North Fifth Street.

And in December, Health Diagnostic Laboratory announced it was giving $2.2 million to the Science Museum of Virginia, marking the largest corporate gift in the museum's history. The gift will fund the development of a major new exhibit gallery called "Improving Grounds."

"It has been crazy fun," said Mallory, 46, who worked for more than 20 years in the laboratory industry before starting HDL.

* * * * *

Her fascination with science and medicine started early.

"I have always been intrigued and interested in treating patients," said Mallory, who grew up in the Doswell area of northern Hanover County. Her father was a welder for Philip Morris, and her mother was an accounting clerk for Bear Island Paper Co.

Mallory entered Virginia Commonwealth University as a pre-med student, focusing her studies on biology, but medical school wasn't in the cards.

"I had to pay for college by myself, and the year I was finishing undergraduate I had intended to continue to go to med school," she said.

But at the time in the late 1980s, with HMOs gaining ground, Mallory thought the nation was "heading towards socialized medicine."

"I would have to continue to take out loans to continue on to med school, and if we went to a socialized medical system, I thought I would not be able to pay back my loans in less than 100 years," she said.

So Mallory completed a graduate degree with honors in forensic science, intent on working in the emerging field of DNA fingerprinting.

But state job cuts nixed that idea, too, so Mallory took a job in 1990 with Wako Chemicals USA Inc., a Japanese-owned company with operations on Bellwood Road in Chesterfield County. The company is a global provider of laboratory chemicals and clinical diagnostic reagents.

"I expected then I would be there at most a few months until I found another job," Mallory said. "I was there about 16 years."

Mallory held a variety of roles with Wako. "I crammed 100 years of experience into those 16 years," she said, while also starting and raising a family in Richmond during that time. She and her husband, Scott, have two sons, ages 18 and 14.

* * * * *

Working in the clinical laboratory industry, she also met some of the people who later joined her in co-founding and managing HDL.

Among them was G. Russell Warnick, a Montana native with more than 40 years of experience working in laboratories, starting when he was a captain in the Army's medical service corps in the 1970s, working in a military laboratory in California.

He later worked at the University of Washington, doing pioneering work in cholesterol testing, before starting his own lab, Pacific Biometrics Inc., from which he retired.

After a few years of retirement, "I was getting bored," Warnick said. So he took a job as a vice president at Berkeley HeartLab in San Francisco, which was using a menu of tests to identify health-risk factors in patients.

However, as a vice president in charge of laboratory operations, one of Warnick's major concerns was geography.

The lab "was sitting right on the San Andreas fault," he said. "So I went to the management and convinced them that we should have a second lab somewhere in the country as a backup."

The eventual choice for that lab was the Richmond area, Warnick said, because of the region's "good universities and good supply of trained professionals and scientists and technicians, and also its relatively low costs."

* * * * *

Mallory had become well-known in the industry through her work with Wako Chemicals and through professional and trade groups, such as the National Association for Clinical Chemistry. So Warnick recruited her to Berkeley HeartLab with plans that she would eventually run the new lab in Richmond.

Mallory spent more than two years commuting from Richmond to San Francisco working for Berkeley HeartLab, and waiting for the time when the new lab would be built.

That time never came. Instead, Berkeley HeartLab was acquired, and the new owners scratched plans for the backup lab and started to cut management jobs.

After that, "long term, it did not make sense for me, and I did not need to be commuting anymore," Mallory said.

So in 2008, she hatched plans to start a lab of her own in Richmond.

"I decided I would give myself six months to start the company, or get a job," she said. "So my husband and I bet the farm, so to speak, to get the new company started."

Skunda, the biotechnology park CEO, had known Mallory for many years, and urged her to open the business in the park.

"The best way to describe her would be laser-focused on building this company and executing its business strategy, and she has just hit it out of the ballpark," he said.

* * * * *

Mallory opened HDL in July 2009. She was joined by three co-founders who now have major management roles in the company.

Among them is Warnick, now the company's chief scientific officer.

The chief medical officer and laboratory director is Joe McConnell, a Michigan native who earned an undergraduate degree at the University of Michigan and master's and doctoral degrees in clinical chemistry at Cleveland State University. He later taught at Indiana State University before joining the Mayo Clinic, a premier hospital and medical research institution in Minnesota.

McConnell's laboratory at the Mayo Clinic had set up a diagnostics program similar to what HDL offers.

"The difficulty was, we were not reaching a large population," he said. "We were helping a lot of people, but they were those people who could afford it."

Joining HDL brought "the opportunity to be able to reach everybody," McConnell said.

"It was a huge decision for me to move from an institution of prestige like the Mayo Clinic," McConnell said. "But I really saw that we had an opportunity with HDL, and it is coming to fruition much faster than I expected; I don't think any us realized that it would grow this fast."

* * * * *

HDL has invested heavily in technology and automation to bring down the cost of the testing it now provides for thousands of physicians across the country.

In part, that technology focus has come through bringing on board a technology guru, Satya Rangarajan, who was born in India, grew up in South America and came to the United States to study computer science, earning a master's degree.

A Richmond-area resident for about 15 years, Rangarajan worked in information-technology management for many years before starting up venture-capital firm Enlightened Capital, which he wanted to use for promoting socially responsible businesses and causes.

Mallory approached him about becoming an investor in HDL. "She pitched it to me," Rangarajan said. "For two hours, I heard her passionately talk about saving lives. That is one of the core things about the company. It has got a mission to make a difference in people's lives."

Though Rangarajan said he was prepared to write a check for HDL, he didn't become an investor. Instead, Mallory found another investor, and Rangarajan joined the company in 2009 as its chief operating officer.

* * * * *

The tests HDL performs are designed to provide useful, easy to understand information for physicians and patients on risk factors for heart disease, diabetes and other diseases.

The goal is to provide key information early enough so that physicians and patients can take action before the disease sets in, and before the costs of treatment rise significantly.

"The analogy would be if you are driving a car, and suddenly that car breaks down on the side of the road," Mallory said. "Are we spending all of our effort in repairing an engine that is failing on the side of the road, or should we be putting maintenance into the system so that the car never fails on the side of the road?"

To that end, the company also offers health counseling services. It now has about 60 health coaches who work with patients on ways to improve their health.

"We train them on what sorts of things can be done, and they discuss that with the patients," McConnell said. "Obviously, their focus is on lifestyle: diet and exercise and those sorts of things."

* * * * *

With the expansion announced in November, Health Diagnostic Laboratory will grow to about 240,000 square feet. By 2014, it should employ about 850 people, Mallory said.

As for its future growth, the company's founders see more markets where it can expand.

"We are evaluating markets outside the United States," Mallory said.

Another frontier is in corporate wellness. The company has been working for about a year and a half to "pilot and perfect" a corporate wellness program designed to help reduce health costs, Mallory said.

"We already have one for our own employees," she said, adding that the company has been rolling out the program to other large companies based in the Richmond area.

"It is quite effective," she said. "We are seeing that in about 14 weeks, we can decrease (health) risk significantly for employees."

jblackwell@timesdispatch.com (804) 775-8123

Forecasting 2012 for RVA

The ball's dropped and January's half over. But it's not too late to look at some forecasts for 2012.

Business, like life, is full of uncertainty.

In January 2011 nobody could have predicted the global economy would be slowed by a massive earthquake and tsunami in Japan. Or that local businesses would be both shaken and soaked undefined all in the space of a week.

Despite the uncertainties in life, executives from both large and small companies took a stab at forecasting 2012 at Thursday’s meeting of the Richmond Venture Forum.

Nasser Chanda, the vice president and general manager of Brink’s Global Payments, said companies of all sizes must ensure their core businesses are running smoothly before looking at growth opportunities.

“Your core business needs to be lean and mean, efficient,” he said. “It must be profitable to form the base for your operations. And for growth you much have some dry capital.”

Though young companies face a tougher time getting loans or capital during a recession, Chanda, whose business is a startup inside the larger operations of The Brink’s Company, said there are also some advantages.

“A recession means more availability of talent,” he said. “So conserve capital to be ready. And debt is cheap right now, if you can get it.”

Linda Nash, the CEO of PartnerMD, said companies may be tempted to snap up the first capital offer that comes along. It’s a mistake she said she’s made in the past, and one she said that she was anxious to avoid when looking to sell PartnerMD (Markel Ventures, a subsidiary of MarkelCorp., acquired the company in July 2011. Nash, like all CEOs of Markel-held companies, still runs the company).

“All money is not created equal,” she said. “As you’re looking for investors go for the money, but not unless you’re sure an investor is in it for the right reason and wants to help grow your company.”

Jason Herzog, founder of Creswell Partners and another panelist, thinks his company can serve as the good type of investor.

Creswell takes equity stakes in small companies and works hand-in-hand with that company’s leadership to run and improve the company. They’re not hands-off investors in the mold of venture capitalists or angel investors. Herzog currently is president of Global Drug Testing Services. The company serves localities around the country, especially in alternative-sentencing programs where people with drug or alcohol addictions receive treatment and monitoring rather than going to prison after a felony conviction.

Shrinking budgets at local governments have put many businesses in a pinch. But since alternative sentencing costs about 10 percent as much as putting someone behind bars, Global Drug thinks the budget crunch will serve as an opportunity.

“The challenge, though, is that every local government is different,” he said. “The trick is finding a service that any county can use.”

As companies wait for demand to increase, AMF Bowling Centers COO Steve Satterwhite said, they should be investing in employees and making sure they feel recognized. He said the results of a recent employee survey undefined 6,000 of the company’s 7,000 workers completed it undefined reinforced that message.

“We were so focused on operational metrics that we were missing that pat on the back and recognition for a job well done,” he said. “So we’ve launched some programs to show our appreciation and recognize good jobs. It’s increasing employee morale.”

eMommie.com find niche in selling off-price maternity clothing

By: JOAN TUPPONCE | Special correspondent
Published: January 02, 2012 Updated: January 02, 2012 - 12:00 AM

Farah Hottle kept getting requests from her pregnant friends and co-workers asking to borrow her maternity clothes.

"I found there were essentially no alternatives to virtual yard sales like eBay and Craigslist where consumers shop at their own risk and sellers often have little to no accountability or support," she said. "I thought, 'Why not start a Web-based company?' "

Hottle created eMommie.com, an online resource for off-price and gently used maternity clothes, in 2009.

"We are like the Marshalls of maternity clothes," Hottle said, referring to the discount apparel retailer. "Our clothing is 40 to 80 percent off the retail price of a garment."

The company's warehouse/office on North Lombardy Street now holds nearly 6,000 units of clothing. That's up from the 1,000 pieces Hottle had bought from a variety of sources when she started the company.

"We are already outgrowing this space," she said.

Most of the clothes sold on eMommie.com are closeouts or overstocks. However, Hottle still buys used clothing from women who want "to recoup the cost of the clothes."

Hottle looked for new sources for her clothing when the business increased.

"I found there was an opportunity to buy closeouts and overstocks from existing maternity brands," she said, adding that she carries items from retailers, including Old Navy, to labels, such as Olian Maternity.

While the majority of the company's customers live in the United States, eMommie.com does have a growing international clientele.

"We have always received a few orders from Canada, and that has picked up. We've gone from one or two orders a month to orders daily," Hottle said. "From time to time, I receive requests from moms from other countries. I have shipped to Australia and Indonesia."

She also ships to families living on military bases overseas.

"They use us as a resource," she said. "The same is true for moms in rural areas that don't have a lot of options."

She is constantly adding new items, such as nursing apparel and accessories as well as baby gifts and gifts for Mom, to the website.

"Our inventory and products fluctuate daily," she said.

Abida Dini, program manager for Complete Care Birthing Center in South Richmond, appreciates the personal attention and service she receives at eMommie.com.

"This was a great find," she said. "The clothing is great as I am (a) petite size and was able to find affordable, good-quality clothing. eMommie makes it possible to buy new-to-you clothes that can help with a woman's self-esteem and self-image, which can suffer during pregnancy."

The company's sales have doubled each year since its founding, she said.

The Venture Forum, a group that promotes the local entrepreneurial community, selected eMommie.com in November as one of its Greater Richmond Companies to Watch for 2012. The award recognizes early stage companies that are on track for rapid growth.

Hottle originally named the company bellybargain.com; she changed it a few weeks later after learning that the eMommie.com domain name was for sale.

"I bought it because it was an existing domain and had search-engine rankings and existing traffic," Hottle said. "When I bought it, it had about 2,000 hits a month. By the end of 2009, we had almost 60,000 hits for the year."

The site now has approximately 30,000 hits a month, thanks to Hottle's investment in Internet marketing strategies, including search-engine optimization and creating partnerships with other websites that have similar audiences.

Hottle also donates some of the maternity clothing in stock to the Centering Pregnancy prenatal program at Virginia League for Planned Parenthood.

"Many of the expectant mothers in our program have limited income, and it is a real relief not to purchase a temporary wardrobe," said Christine Flavin, program manager. "Farah and her staff have showed us incredible generosity, and we appreciate our partnership with them. The clothing is youthful and beautiful, and women feel good wearing it."

Ten up and coming local companies were honored last night by the Richmond Venture Forum.

A crowd of about 200 attended the Greater Richmond Companies to Watch, an annual event put on by the Venture Forum to recognize promising local companies that have the potential to rapidly expand.

This year’s event, held at the Boathouse at Rocketts Landing, honored the following companies:

Proxios, a cloud computing company

Ebidlocal.com, an online marketplace for auctions and estate sales.

Marz Industries, which produces hydrogen fuel cell products for the transportation industry.

Emommie.com, an online maternity clothing website.

MedCPU, creates electronic medical record solutions for doctors.

Handcraft Linen Services, a local company that provides linen and uniform services to the healthcare industry.

Urban Grid, a local firm that sells solar panels and electric vehicle charging stations.

Unboxed Technology, which creates interactive systems to help companies train their employees and educate customers.

The Pediatric Connection, a home healthcare company that caters to children with complex medical issues.

Mobelux, a mobile app creator.

The key note speaker at the event was Christopher Fey, CEO of U.S. Preventive Medicine.

The November Award Ceremony to Highlight Local Entrepreneurial Innovation

11/7/2011 12:32:38 PM

CONNECTING LIVE+WORK+PLAY

Fey's company developed "The Prevention Plan," a cutting-edge online and mobile healthcare plan that provides customized health improvement strategies to each individual customer. 

Christopher Fey, CEO of U.S. Preventive Medicine. Mr. Fey has been elected to the Wall Street Journal's CEO Council-their selection of '100 of the world's most powerful chief executives.' His company developed "The Prevention Plan," a cutting-edge online and mobile healthcare plan that provides customized health improvement strategies to each individual customer. Mr. Fey will speak about entrepreneurship and pursuing 'big ideas,' different ways of raising capital, and the story behind U.S. Preventive Medicine.

The purpose of the Greater Richmond's Companies to Watch (GRCTW)  program is to promote the entrepreneurial environment of the Greater Richmond area by highlighting early-stage businesses that have the potential to become significant contributors to the local economy. This prestigious designation will be awarded to a select number of companies at the ceremony. This year, the annual event continues in its mission to celebrate local businesses that contribute to the entrepreneurial spirit of the Richmond area.

Over two dozen past GRCTW selections have gone on to raise venture capital or had a successful sale of their business- after being selected. Representative companies include PartnerMD, SnagAJob and Health Diagnostic Lab, Inc.

Interested businesses are encouraged to apply online at www.richmondventureforum.com. The website discusses criteria and benefits of being selected. 

The event will be held at The Boathouse at Rocketts Landing on Thursday, November 10, 2011, from 6:00-7:30p.m., 4708 East Old Main Street, Richmond, VA 23231. To attend, please register online at www.richmondventureforum.com

Tickets to this event are $25 for Venture Forum members, $35 for non-members with a sponsor/member connection, and $50 for non-members and may be purchased at www.richmondventureforum.com  Partners include the Greater Richmond Partnership, Greater Richmond Chamber of Commerce, RichTech, VA Council of CEOs, and CIT GAP Funds.

Founded in 1986, the Venture Forum is the Richmond area's premier

business organization dedicated to the success of Greater Richmond's entrepreneurs and its entrepreneurial environment. This is done through programs such as Greater Richmond's Companies to and other networking events.

To learn more and register for the event, visit www.richmondventureforum.com 

Click Here for event details:  Accessing Capital and Creating Successful Technology-Based Companies November 9, 2011 

Looking for a few good startups

The Atlantic magazine is embarking on a week-long road trip through the South to chronicle the region’s start-up scene. First stop: Richmond.

Senior editor Alexis Madrigal and his colleague/fiancée Sarah Rice are set to begin their journey Oct. 23 as part of a special report on start-up regions across the country.

From the Atlantic:

You hear about Silicon Valley and Silicon Alley, the tech scenes of Chicago and Austin and Cambridge, but what about the south? With most tech journalists located in the northeast and California, startups south of the Mason-Dixon line don’t get enough attention.

Here at The Atlantic, we think that’s unfair. In an increasingly Internet-connected world, we reckon great ideas (and interesting companies) can get going anywhere, Palo Alto or Shreveport, lower Manhattan or Chattanooga.

One place they plan to visit is Tumblr’s Richmond office, but Madrigal said he is looking for other suggestions:

 But we need your help! If you’re an entrepreneur in or near one of the cities we’re visiting, we want to hear from you. Why’d you decide to start your company in the south instead of one of the innovation megaregions in California or New York? What are the advantages you find? And most importantly, what’s your company trying to do? What’s your big idea?

Get in touch with us via Twitter (@alexismadrigal, @sarahrich) or email me. We look forward to hearing from you with company, destination, or food recommendations.