Gaithersburg entrepreneur keeps business nimble to keep it in business -- Gazette.Net


George Reese picked a terrible time to start his business.

Reese of Gaithersburg and Walter A. Hill co-founded Employee Navigator, a company that provides benefits management software for companies, in 2008 on the eve of a global recession.

“We signed the lease the week Lehman Brothers went under, so it couldn’t have been a worse time to start the business,” Reese said, able to laugh about it in retrospect. “I guess you could say it’s been uphill since then.”

He and Hill may have picked an inauspicious time for starting a business, but they persisted. Reese said they were able to stay afloat through the economic downturn because he was funding the start-up himself.

Employee Navigator licenses software to insurance brokers who provide an exchange or marketplace to companies throughout the United States. The Gaithersburg-based business has grown about 300 percent this year, Reese said, and now serves 2,700 companies with anywhere from five to 10,000 employees.

“Our objective is to bring down the cost of administering benefits by about 90 percent,” Reese said.

The insurance exchanges Employee Navigator offers are similar to a larger program that came into being soon after Reese’s company did ­— Obamacare.

Reese said the federal Affordable Care Act fell in their lap after the election cycle, but the jury’s still out on whether it will reduce demand for Employee Navigator’s products. He said the Obamacare rollout has been a disaster, but it won’t stop the movement away from paper and toward digital benefits management.

“I think the movement to a digital marketplace is going to ultimately help the business and pressure people to move away from the old, traditional paper,” he said.

Reese has been in the insurance business in one way or another since graduating college. Before starting Employee Navigator, he was the founder and CEO of FlexAmerica Inc., which offered flexible spending account administration. He sold that business to a private equity firm in 2007.

As a business owner, Reese said it’s important to have a good team to work with. Reese hired John Crowley, whom he knew growing up, to be Employee Navigator’s chief software architect, and he said Crowley is great to work with.

“It’s really important just to make sure that you can trust (your team) and have smart people to work with,” he said.

Since founding Employee Navigator, Reese said he’s had to keep his business model flexible by reducing the cost of licensing. He said entrepreneurs must always be re-evaluating their business plan to change what’s not working.

“If you have a great idea and you think you’re going to take that through (the life of your business) without it changing, you’re probably going to go out of business,” he said.