The Greatly Improbable, Highly Enjoyable, Increasingly Profitable Life of Michael Kobold

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Jordan Hollender

TIME SENSITIVE Ed Cruz assembles and tunes a watch in Kobold’s one-room facility in Pittsburgh. How good a watch? “Compare us to Rolex,” suggests Michael Kobold.

Young Kobold, whose father ran a powerful company called the Kobold Group and thus was not exactly around to nurture his son's hobbies, set about writing fan letters to watch gurus, saying, essentially, Teach me. Only one responded personally: the legendary Gerd Lang of Chronoswiss. This would be the first Random But Crucial Encounter. "To me, that was like a superhero calling," says Kobold. "Of all the watchmakers, I idolized him most."

It's a hard thing to get your head around, that a teenage boy would obsess over the idea that he had to learn the art of watchmaking. If this were a movie, he'd be sort of pathetic and would live in a tiny room under the stairs. But Kobold was a child of privilege who traveled between homes in Germany and Florida and studied at the best private schools.

"Mr. Lang taught me everything that I know today about design," Kobold says. The boy would drive back and forth to Munich from the family mansion outside Frankfurt whenever he got the chance, shadowing Lang and eventually becoming something of a surrogate son. Lang taught him the basics of watch design and also of running a watch company.

Eventually, Kobold set off for the U.S. to study economics at Carnegie Mellon in Pittsburgh. It was during one of the first summers back home that he had Random But Crucial Encounter No. 2. Because he was schooled in tactical driving--a skill he picked up at his father's request; Herr Kobold feared that Michael or his brother could be a kidnap target--Michael was often asked to pick up VIPs when they visited Frankfurt to lecture at the International School, his alma mater. One day, he was dispatched to pick up the famous English adventurer Sir Ranulph Fiennes, a man the Guinness Book considers "the world's greatest living explorer." It was raining and they were late, so the kid put his skills to the test. As Fiennes recalls, "The person they sent was a 19-year-old who looked smart and drove far too fast and that was Mike.…We just clicked completely." A friendship was born.

The birth of Kobold Watch, on the other hand, was essentially a byproduct of boredom. Kobold so loathed college that he needed a distraction. Lang told him to start a company, and so in 1999 he did, with $5,000 in cash, Lang's personal warrant (particularly useful with suppliers), and the confidence of the well born and likable. He began with a single watch: a simple design, black and sturdy, known as the Professional. On the advice of Jack Roseman, his college entrepreneurship professor, he placed an ad in a watch magazine, registered a URL, and put the Professional online for the price of $575, becoming, accidentally, one of the first--perhaps even the first, as he claims--Internet-based factory-direct watch companies.

Kobold ran the company from his apartment, keeping stock in a tiny safe. If he had an order when he came back from class, he would attach a strap to a watch, box it up, and dispatch it by mail. That first year he grossed $85,000.

The company has since grown exponentially in sales, but only incrementally in terms of personnel and office space. It occupies a single room adjacent to Kobold Instruments, the American office of his dad's company, from which he rents the space for $750 a month and borrows some corners of the factory for storage. There are just three full-time employees: chief operating officer Dan Scioscia, watchmaker Ed Cruz, and bookkeeper and jack-of-all-trades Bryan Satchell. Kobold also relies on a master watchmaker who works when needed and a third watchmaker who can be called into duty when things are especially nuts. (Later this year, Cruz will head to Switzerland to further his studies; eventually he will be certified as a master.) In a pinch Kobold still assembles watches, as he did until he hired his first employee in 2003. He keeps a jeweler's monocle at his desk for visitors who might expect to find someone more befitting the part of watchmaker than a guy in white sneakers and a polo shirt.

"We tell people we're a bunch of misfits cast away on like a desert island," Kobold says, standing outside, in a blacktop parking lot not far from the Pittsburgh airport. Down the hill is a bread company that lets him wander freely on the factory floor, snatching loaves intended for the shelves at Whole Foods (NASDAQ:WFMI). He has memorized the baking schedule, so that he knows what breads exit the oven at what times. (Cranberry pecan arrives Thursdays at 4 p.m.) Food is Kobold's only obvious vice. He is never far from a box of chocolates and at one point, back in college, he often ate a pound a day. Among his many plans is one to launch a line of Kobold chocolate bars.

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