Behind the deal: How Bitwise was lured to Buffalo – The Business Journals

It started with a fast-growing company thousands of miles away.
It gained steam with a connection to Buffalo.
And it snowballed into an intensive local recruiting effort that included numerous meetings with high-level officials, each doing their part to sell the region as a place where exciting tech endeavors can thrive.
No, we’re not talking about Odoo.
Bitwise chose Buffalo as an early region for its national rollout based on a playbook that has emerged in recent years – local private-sector and political leaders have honed their own anecdotes toward a broader narrative of cohesion and progress.
Nobody is saying there is a deluge of national interest in moving to Buffalo, at least not yet. But they are saying that when opportunities arise, the business community is ready.
“We mobilized civic leaders across the city, almost the same way we did with Odoo,” said Eric Reich, chair of the Western New York Regional Economic Development Council. “We’re building an aptitude and a competency to do these things and we’re only going to get better at it.”
As the story goes, Bitwise co-CEO Jake Soberal was chatting in 2020 with Allen Taylor, a San Francisco investor who works for Endeavor Catalyst.
The conversation turned to Bitwise’s drive to replicate its successful projects in California across the U.S. Bitwise specializes in training workers from underprivileged communities how to work in software; runs its own development company; and develops real estate that houses its programs and other tenants.
Taylor suggested Soberal get connected with the leaders of Endeavor’s chapter in Buffalo, including managing director John Gavigan and board chair John Somers, who owns Harmac Medical Products.
Gavigan introduced Soberal to Michael Wisler, M&T chief information officer, and Sarah Tanbakuchi, who was leading the rollout of M&T’s Tech Academy at the time and is now the CEO of TechBuffalo.
Tanbakuchi, in turn, suggested he meet Eric Reich, a local tech entrepreneur who is now a 43North Foundation board member and chair of the Western New York Regional Economic Development Council.
Reich introduced William Maggio, managing partner of private equity firm Lorraine Capital, who chairs the 43North Foundation board and is vice chair of the Kaleida Health board.
“And Eric and Bill, once I knew them, it felt like I knew just about every person in the community,” Soberal said.
The issue hit home for Reich, co-founder and former CEO of Campus Labs, one of the first successful tech startups in Buffalo. Reich said that he tried everything in his power to foster racial and gender diversity at his company, but ultimately there were limited local pools of those people ready for tech jobs.
Unlike the large financial institution (M&T) and the ed-tech firm (Campus Labs), Bitwise specializes in reaching into the community and supporting workers as they prepare for high-paying tech jobs.
“We tried to develop diverse tech talent at Campus Labs and we failed spectacularly,” Reich said. “Since I’ve taken on these civic roles, I’ve watched us make great strides in our tech community, but one of the key things that’s missing is diversity. It’s an important and difficult challenge.”
The 43North Foundation chose Bitwise last year for its first investment. M&T Bank also invested in the company. From there, Reich and Maggio took the project to the philanthropic community, ultimately putting together a substantial funding package with grants from the Ralph C. Wilson Jr. Foundation, TechBuffalo, Empire State Development Corp. and Highmark Blue Cross Blue Shield of Western New York.
Along the way, Bitwise was introduced to local luminaries, including Somers, Larkin Development Group’s Howard Zemsky, M&T chairman/CEO Rene Jones and Buffalo Mayor Byron Brown.
Reich and Maggio coordinated Bitwise’s ongoing analysis of Buffalo as a potential region, much in the manner they helped court Odoo, a Belgium business software corporation, in 2020. The earlier effort sought to emphasize Buffalo’s big-city amenities and high-pedigree talent in a place that is simultaneously affordable and accessible.
The Bitwise effort was about how Buffalo has the cohesiveness and sophistication to integrate an ambitious, venture-funded company from California into the effort to use technology to improve its own lot.
“I think this could be as big for the community as 43North has been,” Maggio said. “Buffalo is going through a transition and Bitwise will support the next plateau, filling the pipeline with diverse talent to address the jobs we believe are coming.”
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