WASHINGTON -- One year after electing President Barack Obama to a second term, key former campaign aides have created their own private sector companies, many of them making big money working for large corporations. But of all the entities to emerge from the Obama alumni, the least known could play the largest role in the 2014 midterm elections.
To reach the firm, a visitor travels not to a swanky downtown Washington office with glass walls, but rather to a yellow brick row house a few blocks from Dupont Circle, up a narrow stairwell smelling of stale food and carpet stains, and into cramped, second-floor quarters. It's there that the roughly 20 employees of Blue Labs have crammed themselves while playing a big role this year in helping New Jersey Sen. Corey Booker (D) win his seat and Virginia Gov.-elect Terry McAuliffe (D) edge out Ken Cuccinelli (R).
Blue Labs has continued the work that many of them pioneered on the Obama campaign. They know more about voters than has ever been possible before, and they use that information to guide campaign resources -- polls, TV ads, door knocks, phone calls, mail and so forth. Their goal: get their candidates' most reliable supporters to the polls, win over the voters who are most persuadable, and have as precise an understanding of how the electorate will vote as can be had. In industry terms, Blue Labs targets voters using data analytics.
The firm is an assembly of Obama campaign veterans who didn't receive press attention after 2012. Just a small group of people received the lion's share of coverage after the reelection victory: Harper Reed, the campaign's chief technology officer, became the public face for its nerd culture because of his outsized personality, wild hair and piercings (provoking some grumbling from others). Reed's team built the software used by the campaign. Teddy Goff was hailed as the cold-eyed head of digital who raised money online, Jeremy Bird was the community organizing expert who empowered grassroots volunteers to get voters to the polls, and Dan Wagner, the head of analytics, told Bird's volunteers where to go.
Goff started a digital and communications firm with two other top staffers from the Obama campaign. Bird and Mitch Stewart founded grassroots organizing firm 270 Strategies, which also does some data work. Wagner is now CEO of Civis Analytics, whose website says it helps "large institutions" make sense of "big data" and whose sole investor is Google's Eric Schmidt. And Reed, who came to the campaign from outside the Democratic political establishment, is working on his own.
Some of the most skilled players from Wagner's analytics team, meanwhile, are at Blue Labs. Elan Kriegel, Dan Porter and Chris Wegryzn, all now principals at Blue Labs, were "three of the best" in the 50-plus person analytics team, said David Nickerson, a Notre Dame professor who advised the Obama campaign. Unlike Wagner, whose company does not list its clients and is clearly aimed at making a sizable profit, Blue Labs remains primarily focused on doing political work.
In a sense, then, this is the last group of true believers from Obama world. As many other reelection alumni have built corporate-heavy client lists, Blue Labs is helping Democratic candidates and some nonprofits and furthering the progressive cause. One of its top goals is to take the analytics and modeling work done on the billion-dollar Obama campaign and downsize to make it affordable for statewide contests, congressional elections, even state legislative and mayoral races. It is the democratization and dispersal of the Obama campaign secret sauce -- within and for the good of the Democratic Party, of course.
"They have a campaign mentality," said one senior campaign adviser to McAuliffe, who noted that several Blue Labs personnel stayed at campaign headquarters into the wee hours of the post-election morning, helping cull data from the still-undecided Virginia attorney general's race. "This wasn't their client. They didn't have to be there. But because they care about the mission, they were there."
Kriegel, one of the firm's founders, said that "everybody here turned down jobs that were worth a quarter million dollars a year" to work at Blue Labs.
"We are doing some corporate work, but we turn down a lot of work if it's time that we could be spending on a race that we care about, where it's a lot less profitable because there just isn't that kind of money in politics," said Kriegel, 32. "That said, we're not a charity."
Bird, the co-founder of 270 Strategies, said his firm and Civis are "still committed to the things we fought for on the campaign, electing progressive leaders, pushing for big issues like health insurance reform and gun prevention and all these other things." But he allowed that Blue Labs is "particularly doing a lot of work in the electoral realm, which is not about the lucrative nature of it."
However, if Blue Labs has a successful 2014 and plays a big role in 2016, that will also make it increasingly attractive to corporations looking for the next hot data analytics company.
Whatever its longer term goal, Blue Labs is off to a good start. The Booker campaign was a success, though not the kind of tight race that made too many people take notice. Blue Labs' help was needed to ensure that Booker turned out voters for an odd Wednesday election in mid-October, the product of Republican Gov. Chris Christie's desire to keep the popular Newark Democrat off the ballot on the day of the New Jersey gubernatorial election.
McAuliffe was a different story. Democrats acknowledged that getting the onetime Clinton fundraiser -- someone who had never held elected office and was thought of primarily as a political hack -- into the governor's mansion was a tall task. Cuccinelli's terrible candidacy helped quite a bit. But still, the dynamics of Virginia's electorate were the biggest challenge: The state had gone for Republican Bob McDonnell by 19 percentage points in 2009, one year after Obama won it by more than 2 million votes.
In some ways, McAuliffe 2013 was a campaign similar to Obama 2012. Both needed core Democratic voters to show up in a race in which the general atmosphere was negative and voter enthusiasm was not high. Blue Labs built a model of the state electorate early in 2013 by calling 10,000 Virginians whose names they obtained from the party's voter file. They used the results of those calls to create voter profiles that they then matched to the rest of the names in the file. And with those profiles and individual scores for each registered voter from 1 to 100, they built a model of where their likely support was, as well as who was most likely to vote.
"The organizer on the ground is getting a list of the most likely to be persuadable from top to bottom in their region, and then working that list: getting that list to their volunteers, running mail to that list," said Bird, whose company 270 Strategies also worked on the McAuliffe campaign. "They're doing paid ads by looking at how do you get to the most number of these persuadable voters, and then helping you track your progress as you're moving people."
Blue Labs also did its own polling, based on weekly calls to voters that were used to update the electorate model built earlier in the year. According to a chart showing internal polling results from mid-July to the end of the race, which was viewed by HuffPost, Blue Labs never had McAuliffe up by more than 3 points, and its numbers showed the race almost tied at a few different times. Despite arguments that Obamacare's problems made the race closer, the only movement in the Blue Labs numbers over the last two weeks of the race was a slight widening of McAuliffe's lead. The Blue Labs chart showed McAuliffe up by just under 3 points on Nov. 1. He won four days later by 2.5 points.
Porter, the 33-year-old modeling guru for Blue Labs, made money playing online poker for three years ("much to my mother's chagrin," he said) before he joined the Democratic National Committee in 2010 and then moved over to the Obama campaign in 2011. Porter is now lauded among data geeks for figuring out during the Obama campaign how to build a persuasion model, which gives every voter a score on open to persuasion he or she might be.
"I tried to model it for about a week and a half. Porter worked for three days straight, I think without sleep, and came up with an absolutely beautiful model that kicked my model's ass," said Nickerson, the Notre Dame professor. "He has sort of a preternatural knack for knowing which variables in the voter file can be used in very creative ways to get the information you want out of it."
"One of the big insights he had -- he knew the data because he'd been working for the DNC since 2010 -- so he looked at the file and said, 'Oh, people who unsubscribed from our email list, they might need persuading.' Right? So he went, 'OK, let's put that variable in.' Or people who live with a Republican might need persuading. They might be registered Democrat but they're spouse or partner is a registered Republican," Nickerson said. "So going through literally hundreds of thousands worth of variables, he would be able to pick out about 15 that were really predictive."
Blue Labs was paid $46,000 by the McAuliffe campaign and another $161,480 by the Democratic Party of Virginia.
"On the Obama campaign, you're essentially spending infinite resources to get the absolute best model you can," Porter said. "And here what we're doing is ... saying, 'You know, if we can maybe expend a small fraction of the resources, can we get 90 or 95 percent as good a model?'"
"We can help campaigns run their field programs more efficiently. We can help people buy their TV ads more cost-effectively," said Kassia DeVorsey, another Blue Labs principal.
One example lies in polling. Blue Labs has worked hard on "automating that process, building safeguards into it and making it smarter, so that we can run these surveys easier, more cheaply, with better results," said firm co-founder Wegryzn, 29.
Here's the implication for 2014: Blue Labs wants to make this data advantage available to as many Democratic candidates running in the midterms as possible. In the races that are close, these campaign experts will have the biggest impact. Their work cannot change the fundamentals of a race, but it can make the difference in a tight one. And they will have no problem serving multiple clients, Wegryzn said.
"This is something where volume lends a distinct advantage because there is this really big core of techniques and technologies that can grow with the organization," he said, "so the more campaigns we can get the better."
Republicans have declared they will catch up to Democrats in tech, data and analytics in time for the 2016 presidential election, and even "leapfrog" them. So far this appears to be a laughable claim. The Republican talking point is that the Obama campaign built a digital machine for one candidate, and it's not transferable. But in fact, that's not what Democrats did.
"We were building things first and foremost to win that race, but throughout we were building it with an eye toward how do we do this for other people," Wegryzn said of the 2012 Obama campaign. "It wasn't about solving a specific problem. It was about creating the environment in which our analysts could work to solve new problems and to push that out to more and more people."
The Republican National Committee has hired a Facebook executive to be its chief technology officer and placed a digital-savvy Republican operative in the number two staff spot to ramp up digital and data operations. But GOP culture will likely lag behind the Democrats for at least another presidential cycle, for the simple reason that the grassroots has never been part of an operation like the campaigns that Obama ran in 2008 and 2012.
"We've built a culture in the Democratic world, progressive world, of this great respect for data and analytics. It's really built into the campaigns now," Wegryzn said. "We have tons and tons of field organizers and volunteers who are trained up on that. And they've had drilled into them the importance of entering their data and using these systems correctly. And we have leadership that understands how to put these models into practice and has used them on several campaigns."
"So it's one thing to build up some technology and hire some people," he said. "It's another thing entirely to transform how your operation works fundamentally. It's going to take them a couple of years."
Jared Gilmour and Farah Mohamed contributed reporting.