While Shopify, Iversoft and other Ottawa tech firms are leading a growing wave of companies that shed office space during the pandemic as they pivot to a permanently remote workforce, one local company is swimming against the digital-by-default current.
Kanata-based RBR – which makes high-tech sensors used in ocean research – has spent much of the past month doing the opposite of Shopify and the like: rather than downsizing or ditching its offices entirely, it invested a couple of million dollars to convert space at 359 Terry Fox Dr. into its new headquarters.
RBR’s roughly 50 local employees started moving into their new digs in Kanata North at the end of August. The new office is just a short drive from the firm’s old headquarters on Hines Road, but it’s a world apart in terms of amenities and twice as big at 22,500 square feet.
Brett Merriman, RBR’s chief financial officer, says the decision to go ahead with the move during the COVID-19 crisis was almost a no-brainer for a firm that recently made the Globe and Mail’s list of the country’s 400 fastest-growing companies for the second year in a row.
“We’ve been on a growth tear over the last five, six years,” says Merriman, who served as RBR’s point man for the relocation project. “We were really just bursting at the seams at the old spot.”
Planned long before “coronavirus” became a household word, RBR’s refit of the Terry Fox Drive space hit a few snags when the pandemic struck. The building’s owner, KRP Properties, was in the midst of tearing out walls and installing new flooring when all work was shut down for more than a month this spring in a bid to curb the spread of the virus.
"We knew we had some runway, and we're confident in our business. This was the right play for us long term."
But Merriman says the company never second-guessed its plans in spite of a health crisis that upended the global economy and cut off a hefty chunk of RBR’s revenue streams as its customers’ scientific expeditions – known in the industry as “cruises” – were shelved.
“We’re confident in our products and we’re confident in what we can deliver,” he says. “We know even if there is kind of a short-term knockdown as far as revenue, headcount or anything like that, we’re just going to go back on that (growth) trajectory.
“We’ve had some good years, so we had a nice little nest egg of cash, which helps. We knew we had some runway, and we're confident in our business. This was the right play for us long term.”
Founded in 1973 in a Glebe basement, RBR has evolved into one of the world’s foremost manufacturers of cutting-edge equipment that plumbs the depths of the ocean, recording and documenting data such as water temperature and pressure, salt content and oxygen levels.
Such variables provide invaluable data for scientists studying the long-term impact of global warming, and RBR’s growing list of customers includes major foreign agencies such as NASA, the U.S.-based National Oceanographic and Atmospheric Administration, the U.S. Geological Survey and the U.S. National Science Foundation. The company employs a total of about 65 people, with staff in China, the U.S., France and New Zealand.
Brick-and-mortar location a must
The company’s focus on hardware makes a brick-and-mortar office essential to its operations even in the current situation, Merriman notes.
Unlike software developers who can code from their living rooms, RBR’s engineers need to physically create, refine and test products with specialized equipment that can’t just be packed up and taken home.
“I think when you actually (make) physical goods, it’s tough to really be completely remote,” Merriman explains. “We’ve got tons of new products that we're just ramping up to start developing. When you're at that stage of your business, you want people in (the office).”
Merriman says the Terry Fox facility will help accelerate the launch of new products at RBR, where about a third of all staff are engaged in R&D. Unlike the old space on Hines Road, the new office has a machine shop equipped with a mill, lathe, drill presses and saws, allowing the firm’s engineers to design and build prototypes on site instead of being forced to outsource the work.
“We’ve got all the tools there,” he says.
A shiny new headquarters also doesn’t hurt when it comes to luring top talent in a tight market, Merriman adds.
“When you go into a prospective employer, I think it’s hard not to look at their space and (think), ‘This looks like a good spot to work,’” he says. “It does signal some things … If we’re recruiting a mechanical engineer and they see a machine shop, that’s heaven to them.”
Still, RBR hasn’t escaped the pandemic unscathed.
After posting average annual growth of 20 to 30 per cent for the past several years, the company is poised to take a “slight dip” in revenues in 2020, Merriman concedes. The firm laid off about a dozen people over the past six months, although it recently hired four engineers as part of its ongoing R&D push.
“It's probably knocked us back a year and a half,” Merriman explains of COVID-19’s impact.
Still, he’s optimistic that customers in China – a market that accounts for about a third of RBR’s sales – will soon be ready to launch new projects, and he says there are several major new deals in the works.
“We had quite the run,” he says. “But I guess we’ll have to start a new run now.”