Hartford Business Journal

8 Hartford Business Journal • March 4, 2019 • www.HartfordBusiness.com Reporter's Notebook Matt Pilon | mpilon@HartfordBusiness.com Health Care/Bioscience, Startups & Entrepreneurs, Government/Law and Energy PROFESSIONAL SERVICES A 'Big Four' for a small company E veryone knows the "Big Four" account- ing firms — Deloitte, PricewaterhouseCoopers (PwC), Ernst & Young and KPMG — dominate when it comes to auditing the books of publicly traded companies on the S&P 500. They also do plenty of business with large pri- vately held firms. But it turns out they aren't only interested in pro- viding account- ing or consulting work to major companies. To varying degrees, the Big Four have been chasing smaller clients for years, a trend that ac- celerated in the wake of the 2008-2010 recession, partly because some major com- panies went under or cut back on consulting services, leaving the Big Four to seek out new revenues. Deloitte's managing part- ner in Hartford, Rich Tavol- ieri, said it'd be a misconcep- tion to think big firms haven't courted mid-sized clients over the years, but he confirmed that Deloitte has made "sig- nificant investments" more recently to attract the smaller end of the market. "It's critical to our growth strategy," Tavolieri said in a recent interview. "Growth in this space has probably outperformed growth in the public space." One smaller company that Deloitte recently signed on as a client is Farmington biotech startup Rallybio. A business with about 10 employees would be an unusual presence on most Big Four rosters, but Rallybio, led by three former Alex- ion higher-ups, is not your typical mom-and-pop. It's in an industry that carries potentially explosive growth and its team has already raised $37 million in capital. That means Deloitte could be in a good position in the future if Rallybio grows or does an initial public offering. Jeffrey Fryer, a Rallybio co-founder and its chief tax officer who used to work as a CPA, said he could have picked a smaller firm to audit Rallybio's books, but he was drawn to the Big Four's biotech familiarity and "global firepower." "I think all the firms are revisiting their portfolios and as you look to continue to grow, partnering earlier on in a companies life cycle can be rewarding," Fryer said. Tavolieri concurs. "If we help them early on in their life cycle, we build a relationship," he said. "Those relationships can stand the test of time." ENERGY Some consumers say electricity- supplier market is a money-saver A coalition led by Consumer Coun- sel Elin Katz is trying to kill off the state's electricity-supplier market, at least for residential customers. Her logic is that some suppliers — which are third-party companies that buy and sell energy to residents and compete with utilities for the generation portion of ratepayer bills — con- tinue to misrepresent themselves or other- wise mislead when they interact with potential customers. And whether they've been duped, aren't pay- ing attention, or simply don't understand how the market works, the hundreds of thousands of Connecticut custom- ers using suppliers have shelled out ap- proximately $200 mil- lion more than if they had just stuck with their utility for supply between 2015 and 2018, according to OCC data. However, not everyone is paying extra. For example, Avon resident Victor Neumann said he's been saving $600 a year on average by frequently shopping online for new supplier contracts. "I jump all over the place with them," said Neu- mann, 72, a retired Hartford educator who doesn't want to see his electricity savings evaporate. Neumann said he knows there are bad apples in the supplier market, and he's happy Connect- icut has been policing them, but he thinks that instead of banning suppliers, the state should better educate consumers about how to shop for rates and switch contracts. "Teach a person to fish, don't throw his fish away," he said. Neumann said he uses nearly triple the electricity of an average residential customer because he bulk stores raw food in big freez- ers for the therapy dogs he raises, including a 150-pound Leonberger named Yulee. As a result, it's imperative for him to try to shave electricity costs anyway possible. He does it by visit- ing Energize CT's rate website every few days, scanning available offers from suppliers that don't charge an early termination penalty. That allows him to switch suppliers often, without taking a financial hit. But, is it possible for the majority of consumers to have the time, energy and smarts Neumann deploys? Katz, who said she has talked to Neu- mann several times, said it's not, which is a key reason she's calling to disband third-party energy suppliers. "Most consumers don't have his time to spend or the expertise," Katz said. "If 70 percent of consum- ers are getting ripped off, and 30 percent save some, is that okay? To me, it's not." Meantime, energy suppliers have decried Katz's call to restrict their operations here. It'll cost jobs and represent a step back toward utility monopsony, they said. In addition, they note that some supplier customers receive smart thermostats, larger amounts of clean energy and other perks that utility customers don't. "Legislators aren't typically keen on laws that take people's choices away," said Matt S. White, president of the Retail Energy Supply Association. ENERGY Fuel cell manufacturer Doosan opts for office upgrade D oosan Fuel Cell America is split- ting its presence across two Greater Hartford communities. The South Windsor-based company, which in 2014 bought ClearEdge Pow- er out of bankruptcy, recently leased 36,000 square feet of office space in East Hartford's Riverview Square, sited along the Connecticut River, a company official said. David Giordano, a Doosan govern- ment relations executive, confirmed the pending move of roughly 200 non- manufacturing employees to Riverview. About 100 manufacturing workers will remain in South Windsor, where Doosan has been leasing space in two separate buildings on Governors Highway. Doosan will be ceding some of that space as part of the move. The partial relocation is slated to take place around July, Giordano said, though that could change somewhat depending on planned renovations to the new office space. Giordano said Riverview Square has some attractive amenities, like a fit- ness center and full-service cafeteria, that were a draw. "It's a little bit more about getting into a nicer space," he said. Doosan recently won some business from the state, which selected a Doo- san fuel cell-powered New Britain data center project for a long-term utility contract. The Energy and Innovation Park would have approximately 20 megawatts worth of fuel cell capacity on-site. Rich Tavolieri, Managing Partner, Deloitte Avon's Vic Neumann with his Leonberger therapy dogs Yulee (rear) and the late Vikahn. PHOTO | CONTRIBUTED

• Cover