Isle ground fertile, but some opt to go elsewhere to grow

Anyone who’s spent time in Hawaii’s tech community has met Ho‘ala Greevy. Smart, energetic and unrelenting in his pursuit of building startups, he’s been a fixture on the local tech scene for more than 20 years. His latest venture is Paubox, the name of which is similar to an earlier venture called PauSpam, which many people in town are familiar with.

Paubox is an encrypted email technology designed specifically for health and medical organizations such as hospitals, doctors’ practices and other entities that need to comply with HIPAA (Health Insurance Portability and Accountability Act) standards. It allows them to easily send encrypted emails without installing software, pushing buttons or exchanging keys. It’s user-friendly and inexpensive, and you can use it on desktop as well as mobile devices.

It also couldn’t be more homegrown.

Greevy fine-tuned his business by listening to local customers, such as Bonnie Castonguay at Ho‘okele Health Navigators. “Local firms were very supportive and instrumental in helping me get the insights I needed to build Paubox,” he said.

As soon as he started banging out the code one night at Kissaten coffee shop on Piikoi Street, he knew he had a winner. Sales at the company are growing 25 percent a month, and his biggest problem is keeping up with demand.

Paubox was founded the old-fashioned way: with bootstrap capital. But it’s growing so fast he knows that he’ll need to find investors to keep up the pace.

Greevy told me he’s confident he’ll find new stakeholders. His confidence was buoyed ever since he moved offices from Honolulu to the Bay Area. Paubox is now based in the Mission District of San Francisco.

Moving to California wasn’t his first choice. However, he came to realize he had no choice if he was going to make the company grow.

“While I had local customers,” he said, “I needed to get in front of the big players and be in a place where there were lots of potential customers. I also had to have access to capital and talent. For both of those components, you can’t be anywhere better than the Bay Area.”

Greevy has five employees and is certain he can find qualified workers if he needs to add more of them. His business has grown to encompass customers in 26 states plus Guam. He is convinced the current rate of growth couldn’t be sustained just with Hawaii customers.

There were other intangibles the Bay Area had that made the move work. Perhaps the most important of those was his ability to sell his product more readily as a mainland company than a Hawaii company. “No question,” said Greevy, “potential customers took us more seriously when we told them we’re a startup based in San Francisco.”

That doesn’t mean Hawaii doesn’t have advantages. You can still create a great company in Hawaii. “By being far away you have the advantage of stealth,” said Greevy. “Competitors are less apt to steal your secrets, and you still have the bandwidth to get things done.”

While Hawaii’s tightly knit network can be advantageous, if you’re not connected it’s often more difficult to get a job or get your company funded. The Bay Area is a meritocracy that attracts world-class talent.

The mainland also can seem intimating at times, but the competition, he says, will help sharpen your skills. His advice for Hawaii entrepreneurs is to avail themselves of Hawaii’s qualities but be ready to move their companies if need be.

It’s not just that Hawaii has limitations for some startups. “If you were an Oklahoma company, you’d probably end up moving to the Bay Area, too,” he said.

The lesson, said Greevy, is to “grow it local,” but “don’t be afraid to relocate if that’s what it takes to sustain your dream.”

Mike Meyer, formerly Internet general manager at Oceanic Time Warner Cable, is now chief information officer at Honolulu Community College. Reach him at mmeyer@hawaii.edu.