How I Did It: Joe Bekker, Thrustmaster of Texas
As told to Sarah Goldstein
Industry Leader: Manufacturing
Three-Year Growth: 1,456.7%
Thrustmaster of Texas, a manufacturer of propulsion devices for large oceangoing vessels, is one of those rare companies that has benefited from -- indeed, soared because of -- a string of bad events. Blacklisting threat from U.S. government? Check. Alaskan oil spill? You betcha. A plummeting dollar? Couldn't be better. So perhaps it's not surprising that as the economy slumps, founder Joe Bekker has led the Houston-based company to its strongest growth in 28 years.
In 1984, I was running my own company. We traded capital equipment -- pumps, generator sets, cranes, vessels. I had this guy working for me who had a marine background, and at some point he says, "Why don't you try to do some business for the federal government?" I said sure.
He bids on a marine propulsion unit for the Army Corps of Engineers and actually ends up receiving a contract. He comes in and says, "Look, Joe: We have a contract from the government for a marine propulsion unit outboard." I say, "What's that?"
He explains that it's like an industrial outboard motor, but you set it on the back of a barge, and it can propel and steer that barge. I say, "Great, but where are you going to get it?" He says he's going to buy it from a small European company, and we'll make a 15 percent markup when we sell it to the government.
We place a contract with the European company; we finalize things with the Army. Then, all of a sudden, we can't get ahold of our supplier. It appears they have vanished off the face of the earth.
I go back to the Army and say, "Turns out we can't fill this contract. Why don't you award it to your next lowest bidder?" The contract specialist looks me in the eye and says, "Mr. Bekker, I don't think you understand. When you have a contract with the government of the United States, you have an obligation to perform. If you choose not to perform, we're going to have to find you in default. And this means that you're going to have to compensate the government for the additional costs we're going to incur when reprocuring it. You'll get on a blacklist, and you'll never sell to the government again."
I say, "Wait a minute -- let me take another look at the contract." I decided to build it myself. I used subcontractors and suppliers. That's how I got into the business.
When the Alaskan oil spill took place, in 1989, we had all these propulsion units for the Army ready to ship. But they needed units in Alaska to fight the spill. So I got permission from the Army to sell the equipment to the people of Alaska. And after that, I built replacement units for the government, which gave me some extra operating capital and enabled me to start growing.
Now we're experiencing our fastest growth yet. Increased oil prices have helped in that they have given the oil companies the profit, and the incentive, to start looking for new locations for oil and gas, and that has dramatically increased the demand for my product.
And then, of course, there's the exchange rate. Manufacturing in the United States has been going downhill for many years now. With the current exchange rate, there's a great opportunity for American manufacturing to take off again. I'm very bullish about it.