BidPal sees changes at top, cuts workforce

BidPal Inc., one of the Indianapolis area’s fastest-growing companies in recent years, has reduced its workforce by 25 percent and is looking for a replacement for longtime CEO and local tech titan Scott Webber.

The award-winning company, which uses technology to help not-for-profits run charity auctions, cut its full-time staff from 113 to 84 last week as part of a plan to become more efficient, company officials told IBJ.

Webber, an entrepreneurial force and investor behind several Indianapolis tech companies, quietly stepped down from his role as BidPal’s chief executive in early June. He remains as chairman.

Rich Rella, chief financial officer of the company since 2009, was appointed interim CEO early this month and is a candidate to remain in the position, he said Friday.

Rella and Webber said the leadership shuffle and the staff cuts were not related. Both decisions had been in progress for some time.

Webber called the staff reductions regrettable but part of a “change in direction.” He said the company would continue to grow and be the leader in its market niche.

Rella said the company has been turning more attention toward creating software packages that let not-for-profits manage their own fundraisers. The shift toward easier-to-use mobile technology has reduced the need for frequent consultation with its customers, he said.

“We’re becoming more software-oriented and less service-oriented,” Rella said. “We are better-positioned to compete in our market and we’ve become more streamlined to be more efficient.”

Webber, 60, was formerly president and CEO of Software Artistry, the city’s first software company to go public, in the 1990s. He was later CEO of Corepoint Technologies and Autobase Inc. He joined BidPal shortly after it was founded in 2007.

Webber said this week that he’d been considering ending his day-to-day role at BidPal for more than a year. He typically stays with startups for about three years before moving on to new challenges.

“BidPal has been an exception,” Webber said. “I stayed with the company for six years because of its extraordinary mission of making a difference for nonprofits.”

Being involved with BidPal on a day-to-day basis didn’t leave Webber with enough time to look into up-and-coming tech companies to which he could lend expertise.

He said he was taking a little time off to “work on his handicap on the golf course” before investigating and identifying another young company he can help.

“I’ll be hopeful to find the next BidPal or two and help them experience meteoric growth,” he said “That’s what I love to do.”

BidPal was the area’s fifth fastest-growing company from 2011 to 2013, according to IBJ’s latest annual list. The company grew revenue from about $5.2 million in 2011 to $13 million last year—a growth rate of 151 percent. Employment rose from 51 to 113 during that time frame. The firm was named Techpoint’s “Emerging Technology Company of the Year” in 2013.

In November 2012, BidPal made an economic development incentives deal with the state to receive $2.2 million in tax credits if it added 172 workers by the end of 2016.

Rella, 61, said it would be more difficult to achieve that goal because the company is now able to accomplish more with fewer people.

“We wouldn’t see any of that money until then anyway, so it’s not like we’d have to give anything back,” he said. “We aren’t going to let that [deal] drive our decision-making process.”

Rella has never been a CEO, but has a long background in upper management with fast-growing companies.  

He joined BidPal in 2008 as a consultant and became CFO in 2009. He was previously CFO and chief operating officer for Indianapolis-based Suros Surgical Systems Inc., which was acquired by Massachusetts-based Hologic Inc.  for about $240 million in 2006. Prior to that, he was CFO at Pictorial Inc. and Shepard Poorman Communications Co.

Rella said the board has not set a firm timetable for appointing a permanent CEO. “I’m good with whatever they choose,” he said. “I’m very glad to be one of the candidates.”