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Origins

Six short articles describe the unlikely events that triggered the start-up of companies appearing on the 1998 Inc. 500 list.
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What triggered the start-up of some Inc. 500 businesses

Decisive Six Weeks Off
True, 10 years elapsed between the time Rachel Hollstadt took a six-week leave from her job as a high school English teacher and the day she started a business. But she says the hiatus was the key event in setting her on the path to entrepreneurship.

It all started in 1980, when her husband won a four-day trip to Mexico. The school board granted her permission to go along, provided that she stay away for all six weeks left in the semester. She did--and liked being away from teaching so much that she quit her job. After working in various jobs for 10 years, she founded Hollstadt & Associates (#104), a consulting firm in Burnsville, Minn.

From Rashes To Riches
Jon Engelson's son came home from a nursery school in Los Angeles one day in 1990 with an allergic rash. Engelson blamed the rash on artificial food dyes in snacks that the boy had eaten at school. Angry, Engelson began calling schools in the area to see if they would consider substituting natural foods like dried fruits for the snacks in question. School officials expressed tentative interest. Engelson left his job as a commodities broker and started You Are What You Eat (#441), a nutritional-food-products distributor and manufacturer.

Milton Friedman's Unwitting Nudge
Today ATX Forms Inc. (#479) is a flourishing producer of tax software widely used by accounting firms. In 1986, however, the business existed mostly as a twinkle in Steve Willett's eye. A programmer at the University of California at Davis, Willett offered tax-preparation shareware on the Internet. Many people, including renowned economist Milton Friedman, used it. "Have enjoyed using your Excel Tax Templates," wrote Friedman, who enclosed a $30 check. Encouraged by the notable's letter and other such reponses, Willett founded ATX Forms' predecessor company in 1987.

Walking Blondo And Maple
Omaha is a mecca for telemarketing companies, and in 1991 David Petersen quit his job there working for one of them, ITI Marketing Services. To drum up business for a new venture, he started walking Blondo and Maple streets in the heart of the telemarketing district, knocking on doors. Several companies opened them--and that's how he snagged some of his first customers, including the Radisson Hotels' reservations center. In 1993 Petersen founded Telemarket Resources International (#235), originally a telephone-headset-repair shop. His business has since branched into sales of call-center and telemarketing products. -- Ilan Mochari


Last Laugh
Still Feeling His Oats

"What the heck are you worried about business overseas for when Quaker's kicking our ass here in the States?" a marketing executive at the food giant Ralston Purina asked Tim Kleptz in 1990. Kleptz was then working for the company as a production manager in Davenport, Iowa. He had proposed to Ralston Purina what he believed was a surefire opportunity: exporting a sweetened oat-flour blend to South Korea. When his employer said no, he started Purity Foods (#202). The company not only exports the blend but also manufactures a line of private-label cereals and grain-food mixes, many of which compete with none other than Ralston Purina.

From The Ocean To The Bank
Quick: what do ocean buoys and ATM machines have in common? Answer: very little. So how did Triton Systems (#123), based in Long Beach, Miss., morph from manufacturing the first to the second? The story starts in 1979, when three entrepreneurs with Ph.D.'s in physics started making automated drifting buoys to measure ocean currents. When a local bank asked the physicists to devise ATM training machines, they agreed. That led to the manufacturer's switch from buoys to ATM machines. In 1997 its sales were $53 million.

Last updated: Oct 15, 1998




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