Jim Van is CEO and founder of Logicomm, a Providence-based IT services firm that focuses on the small business sector – in many cases, the very small business, or VSB, sector. Van talked with Providence Business News recently about his company, the downturn, and what state lawmakers could do to make life easier for startup firms.

PBN: What do you do at Logicomm?

VAN: I primarily deal with the technical side of our practice, particularly watching for new trends at the horizon. Things have changed so much in the small business IT sector that we’re really required to watch for the “next best thing.”

Other than that, I also work on the marketing side of things and work with producing our Web sites, blog and newsletter. It’s an interesting side of the business where technology is used in a much different way.

PBN: How is your business holding up amid the recession? Have you made any changes because of the economy?

VAN: Customer service is, of course, a prime reason why we’re maintaining our client base. Of course, we also see examples out there of companies killing their customers by overdoing it. We just try to make sure at the end of the day that our customers find solid value in what we do for them.

When we took a look at the numerous shifts that were occurring last fall, we created three new services that focus on entrepreneurs and the very-small-business/micro-business market, those with 20 or less users. Leveraging several world-class tools, we developed a unique delivery framework called techEnsure, our primary support product, that provides these businesses the same coverage as larger firms, at an affordable price. It’s currently our largest growth area, and we see that as a big part of our business moving forward.

PBN: How big a role in the economy do you see those micro-businesses and other very small firms playing in the coming years?

VAN: I can go out and buy a share of GE stock for less than the cost of one of their energy-efficient lightbulbs. EMC Corp. was able to run rings around IBM’s storage business because they were small and agile, and they ended up being the largest storage producer in the world. Small firms account for better than 80 percent of all innovation. Real innovation – not the buzzword variety – needs to be woven into every business plan.

Look at all the wonderful companies that are here in Providence and are focused on very small firms: Logicomm is joined by BatchBlue Software, OfficeLAB and many others. Currently, Logicomm is seeing the bulk of activity taking place at this level. VSBs are central in both the coming recovery and beyond. A lot more business-to-business partnerships are happening and will happen. If a task isn’t part of core business, it should be outsourced. It’s hard to do, especially for an entrepreneur, but necessary. The end result is delivery of a comparable product or service as a larger competitor, often at a lower price.

PBN: You have said before that you would take a cut in your own pay before laying off any employees. Is that a sentimental choice, or do you see it as good business practice? Or is it both?

VAN: It’s both. Having been through a couple of layoffs, I’d rather spare my people the trauma. But it’s largely a business choice. Like any well-run business, we rely heavily on our people, including contractors. They’re the ones our clients see. They are the company. They are all the best at what they do. I can’t imagine laying any of them off. A company is really a sum of their people.

Besides, then I’d have to make the coffee. …

PBN: In the end, the governor’s tax reform group did not propose the elimination of Rhode Island’s franchise tax on businesses. You have said you think this would have been particularly helpful to small startup companies. Why? And what’s your take on the rest of the other tax changes that have been floated?

VAN: The franchise “tax” was robbery when it was $250. Then the folks on Smith Hill doubled it? The best thing they can do is to wipe it out, at least for those companies who are trying to gain traction. Why on earth would government tax someone who has no income?

A lot of the proposed changes that I’ve seen won’t affect VSBs much. We really need a graduated tax that gives the small business-owner a break. I have no problem paying taxes when I have the income, but to be nickled and dimed to death is criminal.

Compared to the last decade, the state has made some good strides, particularly in the Secretary of State’s office and the Governor’s Workforce Board, but we need lots more. Note to the Legislature: Read the business magazines and papers (PBN in particular). There are a lot of answers in them. •