Gordon Nuttall: turning layoff lemons into start-up lemonade

When life gave this 56-year-old engineer a layoff lemon, he didn’t sour. Instead, he started a new company and found how sweet life could be outside the corporate world at this stage in his career.

Interview conducted and edited by Suzanne Deffree, Managing Editor, online -- EDN, October 20, 2011

You had been with HP for more than 30 years. How did you react to being downsized in 2008?

A: We call it “WFRed.” WFR: workforce reduction. So we called ourselves the WFRers. We formed a group of people who met socially and did things together to replace that interaction you would get in the company. That social interaction tends to get lost when you leave a company.

Are these the people who helped you start Couragent?

A: Some, yes. But others I had known from before and are just really talented people. That [fact] was one thing that was instrumental about the [large-scale industry] downsizing and economy: It makes for a lot of really fantastic talent out there. If I started a new company, I would never be able to recruit those people away from their old jobs. But a start-up gives people a chance to think about a new way of doing their work and what their real passion is. That’s one of the ways I think the downsized economy can be turned into lemonade rather than lemons. People get a chance to do something that, in a corporate gig, they might not have ever ventured out to try. Sometimes you need to be upstaged out of your comfort zone, and then you find out that you can do so much more than you ever thought you would within the confines of a company.

Still, building a company during an extremely harsh economic climate couldn’t have been easy. Can you tell us about how you set out and the sacrifices you made in building a start-up?

A: [My wife and I] took our severance from HP and paid off our old debts. We sold off some of the things we didn’t need any more—the extra car, the motor home, some property in the mountains—and invested that money into our new company. Then, we cut back. We took a serious look at what things were in our budget and what we could cut back on. It was very helpful that, at about the same time, our kids made it through college. [My wife has] been really supportive. If you want to start a company it has to be a couple’s decision—you and your significant other. It takes both of you to make it work.

Where did the name Couragent come from?

A: We started the company based on our five foundational values: courage, integrity, collaboration, innovation, and care. When you take the first four letters of courage, our first value—cour—means heart in the old Latin derivative. And then “agent.” When we talk to our team, they are “couragents,” agents of heart. In that talk, we speak not only from our logic but also from our hearts, and the things that matter to us are not just facts and figures but also who we are as a people. The name reflects a lot about our company.

The Flip-Pal mobile scanner is your first product. What are its markets and future plans?

A: We initially targeted it as a mobile scanner with batteries and an SD [secure-digital] card for people who really don’t want to spend a lot of time in front of a computer scanning in their [printed] pictures. It’s high-quality and saves everything on the SD card, just like a camera. What’s unique about the Flip-Pal is that you can take the top off, flip it over, and put it on the picture without taking it out of the photo album, which is a problem with many photos that have been glued in or have decorative edges in a scrapbook. You sure don’t want to take that out and put it in a flat-bed scanner. We designed this [product] to take the scanner to the picture instead of taking the picture to the scanner. Changing that use model makes it different. Add to that the stitching software, which lets you take multiple scans and reassemble it back into a larger image. People love that. It’s a fun product. People see how they can use it right away.

Being a small company, we didn’t want to go to mass retailers too soon. We started selling on our own Web site, on Amazon.com, and through a multitiered affiliate program. We also sell through Brother Sewing Machine, which has a software driver that will stitch a picture [from an image on the SD card]. And then we have independent resellers who may have their own scrapbooking store. Over the next year or so, we will be expanding in other segments, particularly the commercial segment.

In some ways, we are using the Flip-Pal as a way into that more commercial segment. It used to be that you would introduce a product as a business product and then introduce it as a consumer product when it became higher volume. We used to call it trickledown. But we’ve done this product in reverse. We started out with a consumer product, demonstrated that it’s rugged enough for mission-critical tasks in business applications, and then we are going to come out with a version that is designed for businesses.

Any words of advice for the many talented engineers out there who have been downsized and may be wondering what to do next?

A: It’s very common to want to find a job like the one that you had before. Well, that’s kind of slim pickings these days. I was a program manager, and big corporations aren’t really hiring at that management level. I became really involved in professional-networking groups. I really encourage people to join a networking group or to become more proficient at talking with people and getting to know other areas that you normally would not have come in contact with when you were in a company. Be out there, and do a lot more networking.

I also think that the employment model of the future and the one we are using with Couragent involves multiple streams of income, where people are independent consultants and they work under a 1099 contract to one or maybe several gigs at the same time. I would suggest that people form LLCs [limited-liability companies] to take advantage of tax benefits. And go to the conventions; join the associations that are the industry-leading professional organizations. It looks good on a résumé, and it keeps you speaking the general lingo of the industry.

You left college, went into this corporate world at HP, were downsized, and are now here in this whole new life. Are you happy?

A: I’m pursuing my passion. I sometimes will give presentations to groups, and I will say that I’m unemployable now. For me to go back to a corporate gig—where you have to do all the politics, and decisions take forever, and you have to get three doubles of an approval—I could never go back to that. With this small company, when we need to make a decision, we just put our heads together and go for it. Once you’ve experienced that passion for action, you might never want to go back. Some days I wonder what the heck I am doing starting a company at 56 years old. Maybe there is a fine line between crazy and totally gassed.

Everybody thinks it’s the younger folks who are doing all the entrepreneurial, innovation stuff. But we’re doing a great job, enjoying ourselves, and have a very solid business plan ... . So this has got a lot of nice aspects to it.