The Dell Effect

Christian Brothers Automotive, Hop N Happy, Texas Yu2019all BBQ, Creative Brick Builders

Christian Brothers Automotive, Hop N Happy, Texas Yu2019all BBQ, Creative Brick Builders

It’s a Monday night and more than 400 football players and family members are preparing to enter the Hutto High School gymnasium to eat at a barbecue buffet. Inside, Mike Hutton peels the plastic wrap off a steaming tray of brisket he has been smoking for the past 18 hours. By day, Hutton is a technical architect for Dell Inc., but on nights and weekends the father of three puts on his apron and becomes the award-winning chef behind catering company Texas Y’all BBQ.

Mike and Mandy Hutton launched their company in 2009, joining a group of several businesses in the Greater Round Rock area that were founded by current or former Dell employees.

Since relocating to Round Rock in 1994, Dell’s direct economic impact—such as providing jobs and contributing to sales and property tax revenue—is often discussed, but the tech giant’s effect on the community is far wider and includes enabling many offshoot businesses, said Mike Odom, president of the Round Rock Chamber. [polldaddy poll=9272662]

“Whether it is former Dell employees going on to start their own enterprises or simply bringing the expertise and talent from Dell and working for other companies, we see it daily,” Odom said. “The total impact of what Dell brings to our community is practically immeasurable.”

Startup culture

In 1984, Dell founder Michael Dell launched the first iteration of his company as a 19-year-old University of Texas student, and since that time Dell has made innovation a priority, according to the company’s website.

Jonathan Schober, founder of Maximize Others Leadership Resources, said he is not surprised many former Dell employees have been successful in launching their own businesses. Before starting his personal and corporate leadership development company, Schober was a Dell business consultant for more than 10 years. He said Dell in the 1990s was a place of experimentation and empowerment.

“It was high-flying—it almost sounds cliche,” Schober said. “It was entrepreneurial; anyone could do anything they wanted to.”

In her former management position with Dell, Kristena Bins-Turner said she gained the skills necessary to run her Round Rock business, Creative Brick Builders.

Bins-Turner met her husband at Dell, and when the couple wanted to provide more educational entertainment options for their children, they decided to create a Lego-based play and learning emporium that has since expanded to offer after-school programs in 50 area schools, she said.

“The Dell experience is absolutely relevant in decisions I make,” Bins-Turner said. “[In the late ‘90s] we were innovating on the Web, and we had so much opportunity as individuals to create change and try new things.”

David Altounian, an assistant professor of entrepreneurship at St. Edward’s University and a partner at Austin technology incubator Capital Factory, said large tech companies such as Dell tend to attract skilled workers who may then start their own ventures—particularly in places like the Austin area with its strong collaborative and business-friendly environment. 

Altounian worked for Dell before co-founding mobile technology company Motion Computing in 2001. He said he witnessed the qualities that are important in becoming a successful entrepreneur when he worked at Dell.

“A lot of tech is that way, where you have companies going through rapid growth and people who are willing to work hard to get opportunities,” he said. “And that’s really what a successful entrepreneur does. They look for opportunities, but they look for ways to make those opportunities come true.”

In 2013, after operating for more than 20 years as a publicly traded company, Michael Dell and technology firm Silver Lake Partners bought back Dell. Dell representatives declined to speak to Community Impact Newspaper, but a news release at the time stated the acquisition would allow the company to become more flexible and entrepreneurial.

The package

Several former Dell employees said they took advantage of a financial incentive to leave the company and used the funds to help create their own businesses in the area. 

Wes Gunn is one former employee who accepted a severance package. Gunn and his wife, Rebecca, who is approaching her 10th year with Dell, used the package as seed money to help start their North Austin business, Hop N Happy, a 9,000-square-foot inflatable playground.

Gunn, who worked in Dell’s sales department, said he was always attracted to the idea of running his own business, and the package allowed him to do so.

“What I do today is really sales,” Gunn said. “It’s just I’m not selling high-end data centers—I’m selling birthday parties.”

In 2014, its first year, Hop N Happy hosted more than 600 birthday parties, he said.

Clare Hulama, co-owner of Bluebonnet Beer Co. in Round Rock, was a Dell employee for 14 years before she also accepted a voluntary separation package. She and her husband, David, moved to Round Rock when he was offered a position at Dell and now run their brewery and taproom using many of the skills the couple gained in Dell’s marketing and sales departments, she said.

“Taking the [voluntary] separation package provided some of the equity we needed,” she said. “The sales and marketing background I have [from Dell] help with a lot of what we do at the brewery.”

Dell’s entrepreneur network

Supporting entrepreneurs

When it comes to promoting small businesses and encouraging economic investment in Round Rock, Odom said success breeds success. The chamber, the city of Round Rock and their partner agencies work to make Round Rock a business-friendly city, but the presence of Dell and successful local businesses also helps draw new companies to the community, Odom said.

“[Dell’s presence] shows an environment that is truly supportive of business,” he said. “People are seeing what’s happening here and want to be part of it.”

As entrepreneurs gain a local foothold they are able to pave the way for others, and the area entrepreneur network can be a key factor in the success of startups and small businesses, Altounian said.

“A lot of the needs of the entrepreneurs are very similar: access to capital, access to information, being able to navigate resources,” he said. “What you find is the entrepreneurial communities are very important because they do support each other. It’s tough if you are trying to start a business in an area where there are not a lot of other startups because you’re kind of on your own.”

Frank Leffingwell, a Round Rock City Council Member and attorney who worked for Dell in the late ‘90s, said much of Round Rock’s economic success is attributable to partnerships between the city and the chamber as well as a strong entrepreneurial spirit and “can-do” attitude shared by the city and area businesses.

“It is that spirit and attitude that so many current and former Dell employees have brought to their work in the community,” Leffingwell said in an email. “So the Dell-Round Rock relationship has not only been an economic success, but, just as significantly, a cultural success.”

By Emilie Shaughnessy
Emilie covers community news in Central Austin and is the beat reporter for Austin City Council. She started with Community Impact Newspaper in 2015 after working as a journalist in the suburbs of Washington, D.C.


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