Brief profiles and stories about interesting and unusual companies on the 2000 Inc. 500 list.
Dark Day, White Meat
Support Technologies CEO Cliff Oxford knows how to cut calories at Thanksgiving dinner. Two years ago he was so worried that his company wouldn't make payroll that he "didn't eat a bite all day." Knowing payroll was scheduled to clear around the holiday, Oxford had called his bank to increase his credit line. "The day before Thanksgiving they called me and said, 'Can this wait until next week? We have a lot of people leaving for vacation.' I told them, 'Don't go anywhere, I'm coming over there right now." Oxford suffered through an anxiety-filled Thanksgiving Day and confirmed the next afternoon that the money had been transferred in time. --Kate O'Sullivan
Inc. 500 CEOs' Favorite Business Books
1. The E-Myth, by Michael E. Gerber
2. The Seven Habits of Highly Effective People, by Stephen R. Covey
3. Built to Last, by James C. Collins and Jerry I. Porras
"One Chai -- Extra Spicy"
As sales of Oregon Chai's tea beverages took off, the company moved operations from the founders' kitchen to a large production plant. Shortly after the new facility made its first shipment, CEO Heather Howitt mixed a cup of her product for a customer demonstration. "It tasted like jalapeño chai," she recalls. Turns out the previous tenant had manufactured salsa, among other things, and the plant's equipment had absorbed the salsa's zesty taste. Howitt immediately called every customer with orders to dump the new shipment. "Chai was so new to the market," she explains, "and we knew that if that was people's first chai experience, we were in trouble." Oregon Chai has since purchased new equipment and instituted more regular tastings. --K.O.
Percentage of 2000 Inc. 500 companies that were started in the founder's home: 61%
Before starting Lumber Liquidators, Tom Sullivan tried a very different line of work, developing a TV show called Street News. After more than a year on the project, he called it quits, but he says he might try it again. Stay tuned. --K.O.
"Supersize Those Fries!"
Setting short- and long-term goals is important if you want to succeed, but for Eric J. Ruff, the key is to make sure those goals are attainable. So the first long-term goal he set when starting PowerQuest was to be able to take his family to McDonald's and "supersize" their fries without worrying about the cost. To Ruff's amazement, reaching that goal took him much longer than he had anticipated: four years, in fact. But Ruff proudly remembers the day he pulled a twenty from his wallet and "supersized" with impunity. --Sara Callard
Jay Borden of Granite Systems likens running a business to shooting skeet, the art of clay-pigeon destruction, which he mastered as a boy and still indulges on occasion. "One of the first lessons you learn is that you aim at where the target is going, not at where it is now," says Borden. "And that's just what you have to do when you're growing a business." --S.C.
CEO Dating Tips
Like many busy entrepreneurs, Eric Jenkins didn't have a lot of time to devote to finding that "someone special" in his life. So he turned to the online personals. But after an unsuccessful attempt at romance with one cyber-fix-up, Jenkins decided not to pursue "Heidi," a second online love connection. Incredibly enough, Heidi's résumé soon turned up on Jenkins's desk. As fate would have it, Heidi chose Jenkins over the job. The couple were married four months later. "And I've never been happier," says Jenkins. --S.C.
Sean and Scott Smith have been virtually inseparable since they were born -- 15 minutes apart from each other. So it's no surprise that the Smith brothers founded Coalition America together in 1995. Their skills dovetail nicely, with Sean acting as the corporate visionary while Scott oversees the daily operations. Sean claims his CEO status has nothing to do with birth order. "But I am always 15 minutes ahead of my brother," he jokes. --S.C.
Michael Miller, on the advice of his stepfather and mentor, Hank Lempke, decided to wait until his 30th birthday to start a company. When Miller turned 30, he said to his stepfather, "OK, I'm ready!" "For what?" asked Lempke. "I don't know," Miller answered, "but I'm ready!" --S.C.
Percentage of 2000 Inc. 500 CEOs who plan to raise capital within the next year: 47%
You're out of cash, but you've got to meet payroll. Where will you get the money? John Podrovitz of MSS Group found himself sweating over that scenario in 1995, when bank after bank turned his company down for a line of credit. Fortunately, Podrovitz had spent the previous 25 years squirreling away $30,000 worth of Double-E U.S. Savings Bonds for his own retirement and for his daughter's college education. Future be damned -- Podrovitz cashed them in. Of course, his daughter had to wait a few years longer to go to college, but she's now happily enrolled in Colorado College, and Podrovitz is busily rebuilding his nest egg. --Emily Winsett
What's in a Name?
When Pete Wilson came upon the right company name, he decided to stick with it -- even when he didn't have a company. In 1986, Wilson started a telecommunications business called Telwares. But when the company didn't take off, Wilson dismantled it, saving only the name. In 1994, Wilson started the present Telwares -- incidentally saving about $1,000 in legal fees because he didn't need to register a new company name. --E.W.
College roommates Rob Johnstone and Gerry Frey founded Priority Express Courier together in 1994. Johnstone headed up sales, while Frey managed the operations. Four years later both men were feeling burned out, so they decided to switch roles, figuring it might reinvigorate them and, consequently, the company. The two friends have no plans to trade places again. --E.W.
Charity Begins Back Home
When Shankar Ram's mother passed away, last January, Ram took his share of the inheritance and, rather than invest the money in his Laxmi Group, set up a charitable trust in India to feed and educate children and help battered women. Ram says, "My mom earned that money in India. I wanted it to stay there." --E.W.
Most CEOs spend a good chunk of their time "putting out fires." But one weekday morning, Michael P. Weagley had to take that hoary phrase literally when a blaze broke out at Pro-Tech Welding's painting facility. Not one to waste time, Weagley made a few quick calls and hours later had his crew back in business -- in the parking lot. Pro-Tech not only made its scheduled shipments for that day but also broke the company's daily production and shipping records. --E.W.
Percentage of 2000 Inc. 500 CEOs who have made angel investments in other companies: 21%
We Built This City
When McKibben Communications outgrew its office space this year, CEO Mark McKibben decided to build a "media fort" to house the company and its satellite equipment. The three-acre facility will cost an estimated $50 million, which McKibben will fund himself, with the help of some private investors. He hopes to maximize his investment by incubating start-ups in the new facility. Meanwhile, he plans to pamper employees and tenants alike with a cappuccino bar (that delivers), a hair salon, a workout room, dry-cleaning pickup, and a water fountain for the company's five Labrador retrievers. "It will be like a little oasis in the middle of Los Angeles," explains McKibben. --Julia Maranan
The 15K Race
How's this for a catch-22? Eric Moore of Next Dimension Studios needed to land a big customer so he could lease new factory space, but the customer wouldn't sign without seeing the factory. Moore and his two partners had one day to raise $15,000 to secure the factory before the customer arrived. Even though the cofounders had already tapped what seemed like every possible funding source, they were determined to raise another $5,000 each. One partner found a credit-card application in the mail and got a cash advance. One asked his parents for yet another loan. And Moore called everyone he could think of for his share of the cash. At the end of the day, they had what they needed. Today Moore marvels, "We did a lot by the seat of our pants." --J.M.
Percentage of 2000 Inc. 500 CEOs who started their companies with at least one cofounder: 55%
High on the Hog
Fast growth means tense times. But Cynthia B. Kaye thinks she knows how to break the tension. Two or three times a month she rides her cherry red Harley-Davidson through her company's building. She also likes to jam on her electric guitar -- over the company intercom. Kaye says her antics tend to freak out the new hires at first but that people quickly get used to it. She recently brought in a new hire at the management level. When the new staffer saw the CEO cycle by in her leathers with her long hair flying, he immediately called his wife to say he'd picked the right place to work. --J.M.
Percentage of 2000 Inc. 500 CEOs who say that employee referrals are their most useful recruiting method: 49%
Percentage of 2000 Inc. 500 companies started with more than $50,000 in seed capital: 32%
Entrepreneurs love to take risks, so it's no surprise that an inordinate number of Inc. 500 CEOs are also pilots. Kevin Heronimus of Advanced Composites Technology even dropped out of an M.B.A. program to build his own plane. But when it came time to secure a line of credit for his company, Heronimus proudly offered the $70,000 plane as collateral. He still has the plane, along with two others, which he and his staff use to visit the company's 100 franchisees. Heronimus has even taken to hiring staff based on their flying skills. "I got one flyboy right out of the navy," he says. "He's also an electrical engineer and our Internet expert. How's that for a find?" --Jane Brower
When philanthropy works, it's sort of like great-tasting health food: you're doing the right thing but you're also enjoying it. Robert Rutherford of Native American Systems, who is part Choctaw Indian, was keenly aware of how the digital divide was affecting his fellow Native Americans. "Only about 40% of them have a phone," he says, "so how can they set up a computer?" So Rutherford established a division called TOPs (for Tribal Outreach Programs), which consists of groups of "road warriors" who travel from tribe to tribe providing telephony and IT services and educating the tribal communities on the latest technology. The part that "tastes great"? Rutherford is also marketing his company to an emerging customer pool. --J.B.
Percentage of 2000 Inc. 500 CEOs who are of non-Caucasian ethnicity: 15%
Average annual employee turnover at 2000 Inc. 500 companies: 15%
The Power Tie Lives!
While more and more offices are leaning toward a casual workplace, John DuBard enforces a traditional business dress code at Advanced Systems Design that includes long sleeves and a tie for men and the dressy equivalent for women. "We're trying to get across a quality image," says DuBard of this decidedly retro practice. But if it's button-downs by day, it's flapper gowns and flowing capes by night. Quarterly costume parties are all the rage at Advanced Systems, with themes ranging from Men in Black to the Roaring '20s to a Spanish motif, when even DuBard showed up as a debonair Zorro. "It's a way of saying thank you to our people for the work they've done," he says. --J.B.
One Man's Trash...
Nascent entrepreneurs often work into the night, but the precise nature of Steve Healis's after-hours research for Avalon Building Maintenance was a little atypical. Almost nightly, he and his partner donned scruffy clothes, hopped into a van, and drove around Orange County raiding their competitors' Dumpsters, in which Healis insists they found very useful information among the coffee-stained scraps and crumpled Post-its. Healis, who says he and his partner broke no laws digging through the trash, admits that they would feign insanity or homelessness if a night watchman happened to spot them. By the way, Healis has been shredding his own trash from day one. --Julia Ramey
Percentage of 2000 Inc. 500 CEOs who don't expect to be their company's CEO five years from now: 36%
Credit-card financing is a time-honored Inc. 500 tradition. For that matter, so is unmitigated gall. And Jose F. Cancio exhibited both when he filled out a credit-card application that had arrived in the mail one day addressed to his father, who was also named Jose Cancio. Ten years later the younger Cancio would use that card's $20,000 credit line to pay for the equipment he needed to start C & C Concrete Pumping. Did Cancio fils feel any qualms about pretending to be Cancio père? "It didn't matter to me because I knew I would pay my bills," he says. --J.R.
Percentage of 2000 Inc. 500 CEOs who raised start-up capital from friends and family: 33%
Percentage of 2000 Inc. 500 companies that offer profit sharing to full-time employees: 47%
Two for the List
It's always fascinating to discover connections among the members of the Inc. 500. Take Ken Craig and Rusty West, for example. The pair met in 1994, when Craig's Spenser Communications installed cabling for West's software business, Market Scan Information Systems (#33), and they've been friends ever since. "We use each other as sounding boards," says West. Although West will never let Craig forget about the time he beat Craig by 0.01 second on the go-cart racetrack, Craig says he looks up to West. "I admire Rusty for creating his own market niche," explains Craig. "Someday I hope to do the same." --Rebecca Evans
Percentage of 2000 Inc. 500 companies that practice open-book management: 53%
Sure, you're busy. But imagine if besides running your business you were also running for public office. In addition to heading up BL Cos. since 1987, Bob Landino has spent the past decade in the public sector, including three terms as a member of the Connecticut House of Representatives. Of his statehouse work, Landino says, "I've developed expertise in areas that I wouldn't necessarily have taken the time to fully appreciate as a CEO," such as health care and workforce education. Even as his business expands nationally, Landino takes time off to campaign in his conservative district, where as a Democrat he is always prepared for a close race. --R.E.
Divorce, Entrepreneurial Style
It's hard enough growing a company with your husband or wife. Imagine doing it with your ex! Well, Betty Brennan and Joe Taylor do just that, despite their 1995 divorce. The cofounders of Taylor Studios met in college and tied the knot before graduation day. Four years after starting the business, the couple decided to split for what they insist are "nonwork-related reasons." After a brief but amicable divorce process, the two remained business partners. "People are shocked when they learn that we're divorced," remarks Brennan. "We still talk all the time about the business and our personal lives." --R.E.
Percentage of 2000 Inc. 500 CEOs who have gotten divorced since founding their companies: 7.9%
Percentage of 2000 Inc. 500 CEOs that have hired a senior manager other than the founding partners: 76%
What's Up, Doc?
Nathan Fineberg arrived at work one day to find that his office had been converted into a makeshift hospital, with his entire staff dressed in scrubs decorated with the Interface Software logo. The reason? Six weeks earlier the 38-year-old Fineberg had undergone heart surgery after his doctor had detected a congenital heart defect. The medical accoutrements were Fineberg's staff's way of welcoming him back. The surgery forced Fineberg to put both his management duties and his marathon training on hold, although he says he's now cautiously back to both. --R.E.
A Model CEO
You may have seen Frank Brady somewhere before, but it wasn't in a business magazine. It might, however, have been in a fashion spread. In addition to running North American Precast, Brady has been modeling for 10 years. When an agency in Cleveland advertised an open call for models, the now 58-year-old Brady says he thought he'd try his luck. "America's graying, but all the models you see are young and perfect," he says. "I figured there had to be a need for someone old and ugly." Brady's mug has since been featured in brochures, catalogs, television ads, and even a movie. "It's been such a lark for me," he says. "It's an absolute riot." --K.O.
Average percentage of revenues 2000 Inc. 500 companies spend on sales and marketing: 11%
How the 2000 Inc. 500 were selected
This year's Inc. 500 list is the 19th annual ranking of the 500 fastest-growing privately held companies in the United States. Eligible companies must have been independent and privately held through the end of the company's 1999 fiscal year. The ranking is based on the percentage increase in sales from 1995 through 1999. The company must have had sales of at least $200,000 in 1995, and its 1999 sales must have exceeded its 1998 sales. Holding companies, regulated banks, and regulated utilities were not eligible.
Applicants had to submit completed qualification forms and documentation for sales by May 8, 2000. Sales figures were verified by examining tax returns and financial statements (audits or reviews prepared by an independent source) and through telephone conversations with CEOs. Sales are total net sales. Profit ranges are published as reported by the companies and are not verified. Employment numbers refer to full-time employees.
The 2000 Inc. 500 list was compiled under the direction of editorial information manager Charlene Niles. Research editor Sally Chicotel, CPA, advised the team.
Note that the information published in the list is the only information Inc. will make available.
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