Colorado vNet Retrenches, Despite ‘Record Orders’
Maker of lighting and multiroom audio systems has laid off 1/4 to 1/3 of its 90-person work force, but CEO Beierwaltes says the company is one month away from "significantly new product line."
Eight months after receiving a $900,000 incentive to stay in its home town of Loveland, Colo., Colorado vNet has had to lay off one-quarter to one-third of its work force.
At its peak, the company was 90-people strong with a payroll of more than $6.3 million.
Last week, vNet CEO Bill Beierwaltes said that the layoffs were unavoidable even though, “for the last four months we have had record orders.”
Colorado vNet makes residential lighting and multiroom audio systems, and is one of the newcomers to the crowded field. Like others of its ilk, vNet is finding that construction projects have been postponed, if not canceled altogether.
Last week, Beierwaltes would not comment on the number of layoffs facing vNet, other than to say, “It certainly is not crippling. We can live through it very gracefully.”
A former vNet employee told CE Pro about a week ago that the manufacturer had let 25 employees go. Commenting on a story posted on reporterherald.com, “Melissa” indicated the number was closer to 30.
In that story, Beierwaltes indicated that vNet laid off “fewer than one-quarter” of its staff.
The layoffs are not unusual in this industry during the weak economy, but vNet is coming under particular scrutiny because of the $900,000 in subsidies it accepted in March to stay in Loveland. (That figure comes from the recent Loveland Reporter-Herald article. We reported different figures in March.)
As cities will do, Loveland offered the subsidies anticipating that vNet would create new jobs in the area. Having opened a new 42,000-square-foot headquarters there, Colorado vNet projected it would have 250 employees in the next four years.
According to the Herald, the company agreed to pay back $2,000 for each job under 250 that was not filled by the end of 2012.
If vNet stays flat for the next four years, it could owe Loveland maybe $320,000 to $350,000.
Beierwaltes told the Herald that he was “not at all” concerned about meeting the agreed-upon employment target.
Last month, vNet received the Economic Development Project of the Year award from the nonprofit Northern Colorado Economic Development Corp. As the Herald reported on Oct. 23, vNet was recognized for “undergoing a major expansion at its location in the former WaterPik building on Southwest 14th Street.”
Despite the setback, vNet seems to be on the right track to survival. The company’s wireless lighting controls are finding favor in retrofit applications, and even the unconventional architecture of its hardwired system is more amenable to retrofits than other similar systems.
Beierwaltes says that the company has made a “conscious shift” to the retrofit market and that its audio business is “very strong.”
He added that vNet is about one month away from a “significantly new product line.”
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Julie Jacobson is founding editor of CE Pro, the leading media brand for the home-technology channel. She has covered the smart-home industry since 1994, long before there was much of an Internet, let alone an Internet of things. Currently she studies, speaks, writes and rabble-rouses in the areas of home automation, security, networked A/V, wellness-related technology, biophilic design, and the business of home technology. Julie majored in Economics at the University of Michigan, spent a year abroad at Cambridge University, and earned an MBA from the University of Texas at Austin. She is a recipient of the annual CTA TechHome Leadership Award, and a CEDIA Fellows honoree. A washed-up Ultimate Frisbee player, Julie currently resides in San Antonio, Texas and sometimes St. Paul, Minn. Follow on Twitter: @juliejacobson Email Julie at email@example.com
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