The Technology That Could Save Schools Thousands

By giving new life to old computers, Neverware hopes to save schools, hospitals and businesses the time and hassle of upgrading hardware and software.

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By Marti Benedetti

Jonathan Hefter's Neverware could help schools make the most<br /> of outdated technologies.

Opinions expressed by Entrepreneur contributors are their own.

There are juice boxes, and there are "Juiceboxes." Jonathan Hefter and his team at New York City-based Neverware have created the latter, a large-computer-sized box of technology that can plug into schools' aging computers and make them like new again.

In short, Neverware provides a plug-and-play solution for schools. "Our strength is our disciplined focus on very specific technology for education," he says.

Hefter, 27, came up with the idea for his business in 2009 as a senior at the Wharton School at the University of Pennsylvania. Realizing that most schools might need to replace their computers every four years, he figured why not invent a device that could quickly and easily make a slow, outdated laptop fast and efficient. With this, Hefter joined a market for education software and services estimated at $7.8 billion by the Software & Information Industry Association.

After graduation, Hefter moved home into his parents' basement on Long Island and began consulting with engineers and teaching himself about computers and systems. "I wanted to offer schools a more capital-efficient method and enable students to use computers that were more up to date," he says.

Hefter founded Neverware in 2011 with a succinct business plan and recently closed a $1 million round of funding. Its investor group includes Khosla Ventures, Collaborative Fund and others. "People who knew what I was working on introduced me to people they thought I should speak with," he explains.

Neverware started sales at the beginning of this year, and now has nine employees. The company is housed in General Assembly, an incubator for new business in the city. It currently has several clients within the New York Department of Education, contracting with individual schools by meeting with principals and district superintendents directly, and is looking into additional markets.

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Pricing varies depending on the size and type of the school, with standard contracts spanning three years. Similar projects by other vendors could cost $50,000 to $100,000, while his solution might cost a fraction of those amounts. Hefter says most schools are saving, on average, between 40 and 50 percent in hardware and maintenance costs over the operating life of a computer. "They are paying for the end value of turning the computers on and they work well, and it fits their budget."

It can take a Neverware employee two days to update 100 computers. Hefter says during the contract period, computers will keep running without slowing down because Neverware controls all the equipment from its end, ensuring the speed of the service increases in time to match the speed of the latest computers.

Elana Fine, managing director of the Dingman Center for Entrepreneurship at the University of Maryland's Robert H. Smith School of Business in College Park, Md., says Neverware's business model sounds smart by "focusing on a solution perspective. Schools don't care about technology. They care about value. Neverware comes in and [the students have] faster-processing computers."

She adds that dealing with individual school superintendents and principals is easier and more results-oriented for a small-business owner than having to go through large government or corporate bureaucracies. "And if you can sell to the New York schools, you can sell to other markets."

His challenge, says Fine, will be to keep innovating to sustain the business over time as technology changes in schools from computers to tablets to the next big thing.

Hefter says the company's emphasis now is on maximizing growth, but would not forecast when it might be profitable. He added that in the 2014-2015 school year, New York City schools will begin conducting some standardized testing on computers, which is currently fueling interest in its service.

Meanwhile, Hefter has made progress in his personal life. He moved out of mom's Long Island basement, and has his own place in East Village.

Marti Benedetti

Marti Benedetti is a freelance journalist and research analyst based in Detroit.

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