There are 27 miles separating Silicon Alley from the sprawling corporate campus of Lucent Technologies, headquartered in Murray Hill, N.J.
But the distance between the region’s Internet hotbed and the heart of telecommunications research is shrinking. Small wireless start-ups in Silicon Alley, hungry for talent, are poaching the ranks of Lucent and other telecom giants in the suburbs of the Garden State, and they are finding eager recruits.
“One of the hidden benefits we enjoy here is this incredible talent pool in New Jersey,” says Lee Rafkin, chief marketing officer at wireless audio start-up Savos Inc. “These people want a piece of the action.”
Building tech teams
Savos is just one of an estimated two dozen companies launched in Manhattan in the last year that are trying to marry the speed and novelty of the Internet and the ubiquity of the cell phone. To build their technical teams, many of these companies are looking to the west. In New Jersey, Lucent is a neighbor of its former parent AT&T Corp. and its research laboratories, as well as Telcordia Technologies Inc., which was spun off from the former Bell Atlantic.
Poaching engineers
Earlier this year, Savos hired Asa Kalavade from Lucent as its vice president of engineering and Richard Webby from Telcordia as vice president of technology. Elsewhere in the Alley, wireless commerce specialist Mobilocity tapped Lucent engineer Stephen Chang and also found technical talent at the Piscataway, N.J.-based division of cell phone maker Motorola.
“These companies are looking for hard-core talent,” says Cheryle Silverstein, an executive recruiter in Manhattan. “And they’re willing to pay what it takes to get them.”
The demand in Silicon Alley is not limited to the technical side of the business, nor is it only start-ups poaching talent. Internet companies are expanding into the wireless business and are looking for salespeople with a telecom background to help them connect with the wireless carriers.
After 20 years at Lucent, Steven Spencer left his post as co-head of business development for wireless products to head ScreamingWireless, a new division of ScreamingMedia. That Silicon Alley company is refashioning the electronic content it sells into something that can be read on the liquid crystal displays of a cell phone and Palm-like wireless devices.
Needs telecom connections
ScreamingWireless is selling this content to the likes of OracleMobile and OmniSky, companies that have created their own wireless portals. However, it is also partnering with these companies to help them get their portals on cell phones-a market tightly controlled by the cellular carriers, unlike the wide-open Web.
To help ScreamingWireless make headway with the carriers and work with the equipment makers, Mr. Spencer tapped another telecom dealmaker: former colleague Sandy Denton, who most recently worked for Cisco Systems.
The situation is no different for companies outside Silicon Alley. Earlier this summer, Stamford, Conn.-based i3 Mobile hired a senior manager from Lucent, Mwangi Wamae, as head of business development.
“You need that old-style telco thinking,” insists Tim Meyer, a managing director at room33.com Inc., a wireless portal that expanded to New York from Sweden last October. “How do you make a sale to AT&T? You hire an AT&T salesman.”
Attracting this talent, recruiters say, is getting easier. As the fortunes of companies like Lucent and AT&T have sagged, managers and technicians have become more receptive to offers from Silicon Alley.
For instance, Lucent’s stock has fallen from $75, where it began the year, to lows of $40 in August. AT&T started the year at close to $55 and hit lows of $30 per share last month. This has caused turmoil in the upper ranks at the telecom giants, where executives have been accumulating stock options that in some cases are currently worthless.
Pricey executives
Of course, these executives still do not come cheap, particularly in light of the problems that dot-coms have had themselves.
Last year, says recruiter Ms. Silverstein, a technology executive who was making more than $200,000 in base salary a year was willing to take between $125,000 and $150,000 as a vice president of technology at an Internet company in Silicon Alley; the individual expected to make up the rest in valuable stock options. Now, she says, executives want fewer options and are asking for higher salaries.
But despite the sell-off of Internet stocks this year and the stumbling progress of the wireless Web, Silicon Alley still has its lures. “The upside here is certainly much greater,” says ScreamingMedia’s Mr. Spencer.
Michael McDonald is a reporter with RCR Wireless News sister publication Crain’s New York Business.
