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MarketWatch Senior Reporter Jon Swartz recently traveled from California to check out the tech scene in Fairfax County. A seasoned journalist for more than 20 years, Swartz covers many of the biggest players in tech, including Netflix, Facebook and Google. Click here and see below to read Swartz’s article. (Company hyperlinks and bolding added. Click on the original article link to see photos and MarketWatch stock market information.)

Tech is thriving in D.C.’s backyard — despite lawmakers’ efforts to rein in the industry

Tech companies specializing in defense contracts, AI, space, cloud computing and healthcare are thriving in the capital region

By Jon Swartz

Big Tech has made itself at home in the Washington, D.C., area, despite a long-running attempt by the federal government to rein in the industry.

It may seem like a contradictory storyline for the region, which a few years ago landed HQ2, the second headquarters of Amazon.com Inc.  — whose chairman, Jeff Bezos, is also owner of the Washington Post.

“The last 10 years have been the most intense. HQ2 helped reshape the identity of the area: It is no longer a government town,” said Victor Hoskins, chief executive of the Fairfax County Economic Development Authority.

Hoskins spearheaded the campaign for HQ2 in 2018, winning out over several other U.S. cities, although the $2.5 billion megaproject is now on an indefinite delay — which Amazon insists is not related to the more than 18,000 layoffs it announced earlier this year.

HQ2 may be facing a hiccup, but local tech companies specializing in defense contracts, AI, space, cloud computing and healthcare are thriving.

Northern Virginia is home to 17,000 tech companies, nearly half of them in Fairfax, a concentration that has led to an insatiable thirst for workers. There are currently some 121,000 job openings in the region.

Construction cranes and piles of dirt are as common a sight locally as headquarters of Fortune 500 companies, including Capital One Financial Corp., Hilton Worldwide Holdings Inc. and Freddie Mac. In recent years, Nestle and StarKist Tuna have also relocated their corporate headquarters to northern Virginia.

“The migration to California for gold in the 19th century, Hollywood [and] tech may stop, as working from home minimizes the need to go to the center of business,” said Matt Calkins, CEO of cloud-computing company Appian Corp.

The company employs about 800 people at its campus in Tysons, Va., which previously housed newspaper publisher Gannett Co. Appian plans to hire another 600 to 700 workers this year, adding to its total headcount of 2,500.

Calkins, a native of Marin, Calif., who went to college on the East Coast before arriving in the D.C. area in 1994, said that people no longer feel compelled to move to California. His narrative is a familiar one among transplanted residents.

“Here [in northern Virginia] there is no pressure to decamp. It is a sweet spot for building a company with local talent, funding and an affordable cost of living,” he said, noting that the area is home to some 60 colleges.

“We are at the dawn of an era of collaboration between humans and machines,” Calkins told MarketWatch. “It’s an exciting time for Appian, which is at the center of this movement with process automation, and for the region in general.”

Proximity to lawmakers — and contractors

The appeal of the nation’s capital goes far beyond its intellectual and financial charms: It is the epicenter of lobbyists, lawmakers, think tanks and government contractors.

This means tech’s major players are front and center in a region where legislators and federal agencies have declared war on what they say are the industry’s anticompetitive business practices — a war that includes a Justice Department lawsuit against Alphabet Inc.’s Google’s ad-tech business. The search-engine giant has a 160,000-square-foot facility in the region, near Microsoft Corp.’s sprawling campus. Facebook parent Meta Platforms Inc., the recent target of an unsuccessful lawsuit by the Federal Trade Commission, opened a 100,000-square-foot data center nearby.

“Key to being here is, this is where all the rules and regulations haven’t been written yet. We need access to people in such a heavily regulated industry,” said Eric Ingram, CEO of the space-technology startup Scout, based in Alexandria, Va.

Scout’s customers include the Department of Defense and NASA Goddard Space Flight Center.

A dynamic hub for innovation

One rich source of research is the Mitre Corp., a nonprofit that manages federally funded research and development centers that support government agencies across the aviation, defense, healthcare, homeland security and cybersecurity sectors. It was founded at MIT in 1958, at the height of the Cold War, but has increasingly pursued research in civilian fields such as healthcare.

Now, Mitre is in another technological race of sorts, in the pursuit of leadership for artificial intelligence, quantum computing and biotech, the group’s chief futurist, Charles Clancy, told MarketWatch.

Peraton CEO Stu Shea, meanwhile, likens the region’s dynamism to “fiefdoms growing off one another.” Peraton has mushroomed into a $7.2 billion company through acquisitions that have extended its reach into the space, intelligence, cybersecurity, defense, homeland security and healthcare industries. The 18,000-person company wants to add another 4,000 employees in 2023.

“It is a cycle of people, businesses, roads, data centers,” Shea told MarketWatch.

Of course, with growth comes challenges.

“In this area, there are lots of startups and not enough office space,” said longtime business owner Tony Jimenez, CEO of IT company MicroTech. “And it’s a battle for the government to hire and keep good tech people.”

Still, there is plenty of room for old-fashioned entrepreneurs like Raymond Magee, CEO and founder of BloomCatch, a plant-recognition app.

“I came to work for the government from Chicago,” said Magee, who moved to the area in 2008 for a job at the U.S. Department of Agriculture, “and now I’m able to be an innovator who helps businesses and people.”

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Fairfax County Launches Fund to Help Early-stage Founders

Entrepreneurs looking to grow their businesses have a new funding option at their disposal. Fairfax County announced the Fairfax Founders Fund (FFF), a grant and technical assistance program providing funds to early-stage Fairfax County-based startups, will begin accepting applications on April 10. FFF will provide up to $50,000 in capital to help start-ups develop their business and prepare for later-stage investment. It is designed for early-stage, high-growth trajectory companies seeking investment to develop. Goals of Founders Fund include expanding competitive technology clusters in Fairfax County and growing innovation-based businesses and jobs.

The county will allocate $1,000,000 from its Economic Opportunity Reserve Fund to capitalize the program. Applications for the first cohort will be accepted from April 10 through May 23. The program will seek companies who can demonstrate their company has innovative technology, a path to commercialization, a clear market opportunity, and development milestones. Recipients will be able to use the resources for prototype or product development, market research, customer acquisition, technology validation, legal costs and/or other approved areas. Importantly, Fairfax County will not take any equity in the companies supported through the fund. Applicants must provide a 50 percent match, which can be in capital or “sweat equity” and provide progress reports over a 5-year timeframe.

Fairfax County will conduct a broad marketing campaign with a focus on encouraging diverse and disadvantaged groups to apply including women, people of color, people with disabilities, and veterans who are traditionally underrepresented in tech product start-ups. Through Founders Fund the county hopes to foster economic mobility among founders of all backgrounds.

More information and applications can be found on the Fairfax County website at fairfaxcounty.gov, search Founders Fund.

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Celebrating Women’s History Month

This year marks the 75th anniversary of the Women’s Armed Services Integration Act, which paved the way for women to officially serve in all U.S. military branches, and the 10th anniversary of opening all combat roles to women.

“From America’s first days, women have made profound sacrifices for our republic. They have made innovative contributions to our national security, blazed trails for future generations, and inspired us with their dedication, skill, and patriotism. Since the Revolutionary War, more than three million women have stepped up to serve their country in uniform, even before the military fully recognized their service.” — statement by Secretary of Defense Lloyd J. Austin III on International Women’s Day, 2023.

In honor of Women’s History Month, FCEDA would like to spotlight one of the notable women veterans in American history: Rear Adm. Grace Brewster Murray Hopper (1906-1992), a United States Navy Rear Admiral, computer scientist and mathematician. A Yale alumnus (MA and Ph.D. in mathematics), Hopper is best known for her trailblazing contributions to computer programming, software development, and the design and implementation of programming languages. Hopper was the first to devise the theory of machine-independent programming languages, and the programming language she created using this theory was later extended to create COBOL, an early high-level programming language still in use by companies and organizations to the present day.

On a local level, here is a list of just four of the many Fairfax County-based women entrepreneurs who have served this country in the Armed Forces. Happy 75^th Anniversary to all the women who have served. We thank you for your service.

Erinn Roth, Mrs. Jo’s Petite Eats: An Army veteran, Erinn Roth, is the founder and owner of Mrs. Jo’s Petite Eats, a patisserie and café located on the ground floor level of the PenFed building, at 7940 Jones Branch Road in Tysons. Roth appeared on five episodes of the FOX show “Crime Scene Kitchen” in 2021. Roth was the guest speaker on the March 3, 2023, session of FCEDA’s Entrepreneurship 101 workshop. During this session, she provided helpful tips for starting a business (check out the video!)

Quiana Gainey, Securetech360: An Air Force veteran, Quiana Gainey works to modernize, transform and secure the digital experience for government entities as the CEO of Springfield, Va.-based SecureTech360. Click here to read an interview with Gainey about her role at SecureTech360, what inspired her passion for STEM, and why she started SecureTech 350, a cybersecurity firm, and MySecureKid, a nonprofit organization committed to closing the demand gap for future cybersecurity and IT professionals.

Tasha Jones, Twenty39: A Navy veteran and military spouse, Tasha Jones is the Founder, President and Owner of Springfield-based Twenty39, which enables holistic readiness for the future of work in rapidly changing environments using data, strategy, smart management, and technology services and solutions. Jones has a multi-faceted background over the last 22 years within the government contracting space.

Mercedes Kirkland-Doyle, The Good News Community Kitchen: An Army veteran, Mercedes Kirkland-Doyle founded and serves as the Executive Director of The Good News Community Kitchen in 2015. The non-profit 501(c)3 organization provides hunger relief to Veterans, students, senior citizens, survivors of domestic violence, and families who identify as being food insecure and/or in need in Northern Virginia and the D.C. metropolitan region. Kirkland-Doyle is also an Equal Employment Opportunity Specialist at the U.S. Secret Service.

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Weekly Business News Digest

NoVa is #1! Northern Virginia continued to dominate the data center market in 2022, ranking by far as #1 for leasing activity, and there’s almost a waiting list for space, WTOP reported. Commercial real estate firm CBRE reports the data center vacancy rate in Northern Virginia ended the year at less than one percent, a record low. Northern Virginia data centers accounted for 64 percent of all data center leasing nationwide last year. Data center growth has accelerated since the pandemic began with the adoption of hybrid and remote work technologies, as well as companies prioritizing private cloud networks for their IT infrastructures. CBRE’s full North America Data Center Trends for 2022 is online.

It’s great to be appreciated: Seven Fairfax County-based companies were named among Fortune’s annual list of the “World’s Most Admired Companies”: Booz Allen Hamilton; CACI International; Capital One; General Dynamics; Hilton; Leidos; and Northrop Grumman. Fortune, in partnership with the global management consulting firm Korn Ferry, surveyed approximately 4,000 corporate executives and directors to compile the Most Admired rankings. A company must score in the top half of its industry group to be included on the list. “CACI is at the forefront of delivering next-generation technology and expertise that will help secure our nation for years to come. Our standing among Fortune’s World’s Most Admired Companies for a 6th consecutive year is the result of our strong commitment to hiring and retaining industry-leading talent, delivering innovation to our customers, and providing value to our shareholders,” said John Mengucci, CACI President and Chief Executive Officer. “We thank our employees for their dedication and are extremely proud of the complex national security challenges we address each and every day.”

Bolstering Japan’s space domain awareness: Falls Church area-based Northrop Grumman and Japanese heavy-industry manufacturer IHI Corporation signed a memorandum of understanding March 15 to develop “small, highly maneuverable satellites and other solutions” that will help bolster Japan’s space domain awareness capabilities, particularly for geosynchronous orbit, according to Space News. The two companies said their collaboration was to achieve Japan’s goal of reinforcing its space domain awareness capabilities and related infrastructure. Northrop Grumman vice president Troy Brashear welcomed the deal, saying the pair will “rapidly work together towards an affordable and effective SDA solution for Japan.

Green light: Inova Health System received the Virginia Department of Health’s approval to proceed with plans to bring a new hospital to Springfield, Washington Business Journal reported in an article for subscribers. The Falls Church-based health system secured the certificate of public need Tuesday afternoon for the nearly one million-square-foot hospital it’s proposing for the intersection of Beulah Street and the Franconia-Springfield Parkway. Inova’s Springfield project calls for a new six-story building with an emergency department and inpatient units, an outpatient center, parking and a helipad. A planned second phase would grow the total campus footprint to roughly 985,000 square feet, including the existing 146,000-square-foot Springfield HealthPlex.

Ten-hut! Virginia has the no. 2 most active-duty military members in the country, second only to California, Courier Tribune reported. The list of the states with the most active-duty military members was compiled using 2021 data from the Department of Defense. According to the analysis, there are 126,529 active-duty military members in Virginia, which is 10.9 percent of the total active-duty force. There are 1,457 active-duty military members per 100,000 in Virginia.

Strategic space partnership: Herndon -based LinQuest Corporation and Lenexa, KS-based SpiderOak, which is moving it headquarters to Reston, announced a strategic partnership to protect space mission systems for government and commercial customers, reported Intelligence Community News. “LinQuest is excited to showcase SpiderOak’s game changing OrbitSecure technology to our national security space customers,” said Joe Dodd, LinQuest’s senior vice president for corporate development. “Cyber-attack poses the highest risk to space assets and this partnership opens the door to many new opportunities to provide essential technology solutions to our customers.”

More to see: Herndon- and Seattle-based BlackSky was among the space companies that provide hyperspectral satellite imagery that were awarded five-year study contracts from the Chantilly-based U.S. National Reconnaissance Office (NRO),TechCrunch reported. In a statement, Pete Muend, director of the NRO’s commercial systems program office, highlighted the speed with which the agency was moving in acquiring new tech. “In just over four months from RFP release to award, these contracts demonstrate our continued commitment to agile acquisition,” Muend said.

On a roll: Chantilly-based Pavion, a provider of fire, safety, security and critical communications technology, formerly known as CTSI, acquired Silicon Valley-based Netronix Integration. It marks the company’s 13th acquisition since partnering with Wind Point Partners in mid-2020. Launched in 2007, Netronix delivers security integration technology and services to clients in industries such as education, technology, healthcare, critical infrastructure and utilities. Potomac Tech Wire carried the release.

Kangaroo connection: Tysons-based Zephyr AI and California’s KangarooHealth entered into a strategic agreement to provide clinician support with an artificial intelligence-assisted remote patient monitoring platform in order to improve treatment decisions for chronic patients, according to Bio Buzz. The multi-year strategic partnership will combine Zephyr AI’s industry-leading machine learning technology with KangarooHealth’s proprietary remote monitoring platform. The two companies aim to use the combined platforms to predict and prevent adverse outcomes for patients diagnosed with chronic conditions. David L. Morgan II, CEO of Zephyr AI, said the partnership potential is “tremendous.” He said the collaboration will ultimately provide treating clinicians with clearer insight that will enable them to anticipate and address needs of patients.

Two -sats: Tysons-based Intelsat, selected Israel-based NOVELSAT, which has an office in Tysons, satellite modems technology to supply high-speed trunking and backhaul connectivity for wireless and wireline networks, SatNews reported. “Intelsat is constantly innovating so we can deliver the solutions that meet the growing expectations of our customers,” said Al Soto, Senior Principal Product Manager, Networks, at Intelsat. “NOVELSAT’s cutting-edge technology will be a valuable addition to our network and will allow us to further enhance our services and provide customers with the reliable, high-speed connectivity they need.”

Funding places: Placemakr, a Washington, D.C.-based flexible-use multifamily and hospitality operator that has properties in Tysons, raised $65 million in funding, citybiz reported. The round, which brought the total capital raised to $350 million was led by Highland Capital Partners, Harbert Growth Partners, Bernstein Management Corporation, Camber Creek, and Gaw Capital USA. The company intends to use the funds to continue doubling down on property acquisitions and developer partnerships throughout the U.S. to meet the consumer demand for apartment-style hotels, short-term rentals, and flexible-living accommodations.

Polar express: Reston-based wireless communications entrepreneur Len Forkas plans to ski to the North Pole in April to raise money for Hopecam, a nonprofit he founded 20 years ago to provides connective technology to children stuck at home while going through cancer treatment, Reston Patch reported.  His goal is to raise $60,000 to match the 60 miles he will ski at the North Pole. To date, Hopecam has virtually connected more than 3,750 children to over 65,000 classmates throughout the U.S.

Top honors: Two students at Northern Virginia high schools were awarded top honors in the prestigious Regeneron Science Talent Search. The second place prize went to Emily Ocasio, a senior at Fairfax-based New School of Northern Virginia. Ocasio won a $175,000 prize for her study on media biases. Ocasio’s project, “Demographic Correlates of Humanizing Media Coverage of Homicide: Evidence from the Boston Globe, 1976-84,” which used artificial intelligence to measure demographic-based media biases in coverage of homicide victims. In addition, Ethan Zhou of McLean High School won seventh place for his study, “Online Learning of Smooth Functions,” which studied the theory behind a machine learning model. He was awarded $70,000. Northern Virginia Magazine has more.

Robotic gardening: Students at Annandale and Falls Church high schools are learning how to use FarmBots to automate gardening, Annandale Today reported. FarmBots are robots that can be programmed to plant seeds, water plants, pull weeds, and harvest the produce. The FarmBot program is a component of Hands On Harvests, a volunteer-run nonprofit that encourages people to grow fresh produce and supports community gardens, among other projects. Transurban donated $5,000 to Hands On Harvests for the FarmBot program.

Play Ball! Just one day after Major League Baseball’s Opening Day, Tysons-based Capital One will kick off the inaugural season of its newly built baseball stadium in Tysons, according to Tysons Reporter. Capital One Park, located at 1600 Scotts Crossing Road, will host its first-ever games on March 31, introducing itself to the neighborhood with a double-header between Arlington’s Marymount University and Centenary University from New Jersey. “Capital One Park, when it comes online in late March, will be an attraction for the community to come together and experience America’s favorite pastime,” Capital One Center Managing Director Jonathan Griffith said.

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Contract Wins

Raft (Reston) obtained a contract from the U.S. Air Force to develop a communication broker for the service branch’s cloud-based command and control system. ExecutiveBiz

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May 4 – NAIOP Bus Tour and Trade Show. This annual tour looks at what is driving the market in Fairfax from office to industrial and retail to mixed-use. Bus Captains talk about all aspects of the market and provide valuable input on what is going on in the market. One of the most successful and interesting commercial market bus tours in America. The day starts with a trade show with vendors, properties and local government sharing news and closes with a reception once the buses return in the early afternoon. Click here for more information.

September 26-28 – Call for Experts: Connecting the Global Quantum Ecosystem. Quantum World Congress 2023 will occur September 26-28 in the Greater Washington region. It will once again bring together leaders from across the quantum ecosystem around the globe to address pressing challenges and emerging trends and share insights that help to accelerate and commercialize quantum technologies. Programming will take many forms — from presentations and panels to fireside chats and networking sessions. QWC will enable relevant, timely, and industry-leading information sharing and relationship building across these formats to foster a responsible environment for quantum growth. If your expertise and experience position you as a thought leader, then you are invited to complete the speaker application. Please also review the sponsorship packages to explore ways to showcase your brand at the event. Click here for more information.