‘We like to be first to fiber’: A Q&A with Metronet CEO Dave Heimbach
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In September, Evansville-based Metronet named Dave Heimbach as president and CEO of the fiber optic company. Other leadership changes included former CEO John Cinelli moving into the role of executive chairman, Sarah Overbaugh becoming chief financial officer and Lohn Weber filling a newly established position of executive vice president—capital markets.
Heimbach, a 25-year telecommunications industry veteran, has been president and COO of Metronet since 2021. The company provides services such as high-speed fiber internet and full-featured fiber phone in more than 250 communities across Indiana, Kentucky, Illinois, Iowa, Michigan, Minnesota, Ohio, Florida, North Carolina, Virginia, Texas, Wisconsin, Missouri, Colorado, New Mexico and Louisiana.
Heimbach spoke with Inside INdiana Business about his extensive telecommunications career and Metronet’s rapid growth.
Why did you choose telecommunications as a profession?
I was completing my undergraduate degree in the mid to late 1990s, and at that time, everybody was getting inundated with AOL CD-ROMs in the mail, and it was at the dawn of folks signing up for dial-up internet. The internet was in its infancy of adoption, becoming much more widespread across the country. As a college student, I was pretty fascinated with that development.
Where I got my degree at Ohio University, there was a fairly small program within the College of Communications called the McClure School of Communication Systems Management that effectively combined a business degree with a communications degree in the field of telecommunications. You got to go work on switches, routers and phone systems and learn about the regulatory landscape and this burgeoning technology that powered the internet.
It was a fascinating time in the history of telecommunications, and it was also ideally situated to where I was in my college journey. That’s how I ended up in the field. I was able to complete a couple of internships at my hometown phone company, Cincinnati Bell. That worked out nicely for me, and I haven’t looked back since.
Tell me about your telecommunications experience, including your time with Metronet.
The internships I did for Cincinnati Bell led to a full-time job offer after college. I became a product manager in our business market segment, so I focused on business customers. That was back in the day when digital subscriber line, or DSL, technology was an emerging and hot technology, which seems laughable today.
About nine months into my journey at Cincinnati Bell, I was recruited by an early-stage DSL company that was expanding nationwide. A company called Rhythms Net Connections in Denver, Colorado. They had just gone public on the Nasdaq and were throwing a lot of stock options at people.
I went out to Denver and rode that train all the way through a restructuring and bankruptcy proceeding because—like a lot of internet companies during that 2000-2001 time frame when the economy took a hit and then 9/11 occurred—everything got turned upside down and funding dried up.
I called my old contacts back at Cincinnati Bell, tucked my tail between my legs and went back to work for my hometown phone company. I ended up there for the better part of the next decade. I worked my way up through a succession of different roles to chief operating officer. We went through a divestiture in an IPO of our data center business and some other restructuring. So I decided to leave and go back to Denver, Colorado.
I got recruited to go to a privately held, fixed wireless company that was operating in 16 states out west called Rise Broadband. I did that for a couple of years in hopes of helping the board pursue strategic alternatives for either a sale of the company or a recapitalization of the company. Unfortunately, that didn’t come to fruition.
I did some advisory work for one of the private equity firms that has been a longtime investor in Metronet. This is now circa 2018 when I was between jobs and got to know John Cinelli and the Metronet story. But I was lured away to take the chief operating officer role at another public telecommunications company based in Virginia called Shentel.
I helped Shentel reevaluate its long-term growth strategy and expand its fiber platform. I also oversaw the sale of its wireless assets to T-Mobile for $2 billion. Around the time that transaction closed, John Cinelli reached back out to me shortly after the announcement of KKR coming into the capital structure at Metronet. In July 2021, I joined Metronet, starting out as the president and chief operating officer and now CEO.
What makes Metronet different from other fiber optic companies?
There are a lot of folks in this fiber game, and it feels like there are more and more every day. We welcome the company. It’s good validation of Metronet’s strategy.
What really differentiates us is our people. I give John tremendous credit for the culture that he and the leadership team have carefully curated over the years at Metronet. It’s a very common sense set of promises that we make to take care of each other, our customers and the company. We have a very hardworking and humble midwestern ethos at Metronet that’s conveyed in how we show up at work every day and do what we do.
As a result, we differentiate in the customer experience we create. God forbid you have a problem, but if you do, we resolve those issues very quickly, the same day or the next day. We answer the phone when you call us. We have domestic customer support who are our associates. We offer service levels for folks who order service the same day or the next day.
Our product and our network perform really well. We spent a lot of years curating the design of our network to be highly resilient and able to withstand outages. When we do have outages—they do occur to all service providers—we resolve them quickly. And we try and go out of our way to over-communicate with impacted customers.
We have a premium product with a premium service experience. Folks who are accustomed to acquiring their residential or commercial internet service from the local phone company or the cable company can’t get that level of service and performance from those companies. We find we are welcomed with open arms in new communities because we’re bringing choice, value and a better customer experience.
Why is it important to expand high-speed internet to small/midsize cities and rural areas?
Those communities deserve what folks living in NFL cities have long enjoyed, which is a healthy competitive environment and choice. Anymore, broadband is perceived by the consumer to be absolutely mission-critical in their homes and their lives, in the education of their children and in supporting the livelihood of people’s careers. What we do is critical for the country and for those folks who are living in lower population density areas.
It’s something that also resonates with our people and our associates in terms of our mission. We have a phrase on posters all across the organization with our purpose, which is to bring dreams within reach by connecting people to living, learning and each other. That pretty much sums up what we do and why it’s just as important in those communities as it is in larger metropolitan areas.
What are Metronet’s successes?
We’re still in the early innings of our long-term journey. I can point to any number of things, but I would say the team here has executed the strategy very well. We’ve been very disciplined in terms of what we do. It’s easy in business to become distracted with bright, shiny objects and pursue alternative avenues of growth from time to time, particularly when new trends or new technologies emerge.
Metronet has been committed to its core strategy of expanding its fiber footprint in small and mid-sized cities. The growth we’ve achieved and the value we’ve created for our shareholders have been second to none in the industry. We’ve worked hard to scale the operation to support that growth and made great strides all along the way. There aren’t many companies in America today that are expanding at the pace we are and able to maintain service levels like we do.
In the last year alone, we doubled our pace of construction to roughly half a million homes and businesses, and we eclipsed the half-a-million subscriber mark. We did all of that while improving service levels in field operations with installation and repairs and contact centers with answering calls and resolving customer issues. We’re focused on reliability, responsiveness and proactivity—how we show up every day to take care of our customers.
What are the company’s challenges?
A lot of the challenges Metronet faces are macro-level challenges that many businesses in America today face. The rising interest rate environment, inflationary environment and topsy-turvy capital markets environment have been challenging for us to navigate.
Our cost of capital and doing business has increased. We’ve done what we can to absorb as many of those costs as we could. Some of those costs we’ve had to pass on to our customer base, although we’ve tried to be very judicious regarding when, how and to what extent we’ve done that.
In the telecommunications arena, it’s becoming a more crowded space in terms of constructing and operating fiber optic networks. We’ve had to be as good as we’ve ever been at screening new markets for the things that we generally target—we like to be first to fiber. With so many folks out building fiber optic networks these days, that’s a more competitive landscape than it was three to five years ago.
But there’s still plenty of room for us to grow. This is a big country and probably less than half of America that wants access to fiber has it today.
What does it mean to you to be named Metronet’s CEO?
It feels very humbling. Working with the team in my prior capacity as chief operating officer gave me the opportunity to prove myself to them and to our investors. Being elevated to the CEO role is a validation that I’ve hopefully contributed in the way that my management team and our investors expected or even a little better than that. It’s always nice to be recognized for your hard work and for all the years spent building a career in this industry.
What is your vision for the company in the future?
We have tremendous growth prospects ahead of us. We are going to continue building at an ever-increasing pace because we’ve got plenty of available open road and market opportunities to do so. We can easily triple the size of the company and more.
There will be an era of consolidation in the industry. There are a lot more folks who have raised capital and are building fiber. But that also creates an opportunity for Metronet—given the size we are becoming and the strength of our balance sheet—to play the role of consolidator of those smaller operators down the road. We’ll be eager to capitalize on that opportunity as well.