The Metamorphosis

Roy Wetterstrom saw his successful high-tech consulting company about to hit a dead end. So he's risking everything to remake it from top to bottom.

By Mike Hofman |  @mikehofman   | 
 

Editor's introduction:
Sometimes it seems as if the Web has turned the world upside down. In the hype-ridden landscape called "dot-com," it's easy to assume that only the young, the new, the original idea conceived by two kids in their basement will survive. Out with the old.

How untrue that is. The two companies profiled here -- Plural in "The Metamorphosis" and Camera World in " When Something Clicks" -- are hardly start-ups. Their leaders have been running steady, profitable companies for years. They're taking those years of experience managing entrepreneurial brick-and-mortar companies and using every ounce of their knowledge to transform their businesses into winners in the online world. CEO Roy Wetterstrom, never a guy to fear change, is rebirthing his 11-year-old company to take great advantage of the new economy. And Camera World has built on its 22 years of experience fulfilling customers' expectations to transform itself into an E-commerce business.

BRAVE NEW COMPANIES

One morning Roy Wetterstrom awoke to find that his company had been transformed into an underdog. To get the buzz back, he's remaking his business from top to bottom

Roy Wetterstrom grew up on a 60-acre farm in Ham Lake, Minn. As legend has it, he sold eggs by the side of the road at the tender age of 11. At 14 he used his egg money to buy a chain saw and switched to selling firewood. Even then, apparently, he was willing to give up a good thing to hatch something new.

That long-ago gambit pales in comparison with what Wetterstrom has at stake these days. He's spending millions of dollars on the risky proposition that he can reshape Micro Modeling Associates -- his rock-solid $54-million client/server consulting business -- into a company at the leading edge of the dot-com revolution. "We're going to transform ourselves into a top-tier Internet services, strategy, and development company," states the 35-year-old CEO.

The agenda is bold, but then again so is the individual behind it -- a lanky, quietly intense man with dark hair and a slight midwestern accent. Eleven years ago he left a cushy job in Minneapolis, not far from where he grew up, to start a company. He moved his wife, Emily, and their West Highland terrier to a two-bedroom apartment in Manhattan's Battery Park City -- on Christmas Day, no less. In the cramped quarters of the second bedroom, Wetterstrom launched his new business. It grew so rapidly that in 1992 he snapped up a lease on lower Broadway in what eventually would become prime Silicon Alley rental space.

But all that -- in Wetterstrom's take-big-risks world -- is ancient history. Today he is remaking his business into an adviser to dot-coms and corporations moving online. To underscore its new mission, the company will even junk its old name. As of March 15, 2000, Micro Modeling will be known as Plural.

To get to this point, Wetterstrom has hired three image-building consultancies, is recruiting three new senior executives, and is on track to add 185 employees to his company of 375 by year's end. He has added a creative group and a management-consulting practice, reined in his sales force from selling the same old client/server stuff (the equivalent of ditching the egg business), dismissed his public-relations firm, and even started exploring potential acquisitions. And he's done all that while commuting weekly from Minneapolis. (He and his wife moved back in 1994, when they decided to have a family.) On Monday evenings, when he boards the flight to LaGuardia, he says good-bye not only to his wife and three-year-old son, David, but also to his baby daughter, Margaret, who was born in April 1999, in the middle of all the madness of turning Micro Modeling into something entirely new.

Brawny upstarts have been grabbing Internet work from Micro Modeling's longtime customers.

Wetterstrom's vision for transforming Micro Modeling into Plural boils down to this: First, the company is forgoing all new client/server work -- the work that made it a star -- in favor of all-Internet projects. Second, the company will risk being unprofitable for the first time in its history. To make matters trickier, the company will soon find itself under the microscope of the unforgiving public markets. "We're driving ultimately to an IPO, and that is bringing a lot of issues to the fore," Wetterstrom says.

For the CEO and his peers in the high-tech consulting world, the pressure to author a shrewd Internet strategy can be particularly brutal. Investors -- as well as employees and customers -- often push consulting companies' CEOs to build Web practices. Of course, although that process is stressful, the potential upside is enormous. The companies that the new Plural will compete with have been soaring in the public markets despite being relatively young and small. Old-line technology-consulting companies like Micro Modeling don't make waves on NASDAQ. Wetterstrom would like to grab a larger share of the Internet consulting business -- and he believes that a big shake-up is needed to do it. "We want to put a stake in the ground and say, 'This is who we are," he says.

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    • Mike Hofman

    Mike Hofman was previously editor of Inc.com and a deputy editor at Inc. magazine, which he joined in 1996. The site was nominated for a National Magazine Award for Digital Media in 2010, and was named the best business website by Folio Magazine. In 2006, Hofman was part of a team of writers nominated for a Webby Award for best business blog. He lives in New York City.


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