Built Oregon -Oregon's Entrepreneurial Digital Magazine

Author - Andrew Bolsinger

Radio Design on cutting edge of high-tech expansion

Front03

Jim Hendershot likes to play with radios, which to techie troglodytes seems as about as economically purposeful as say, Kodak film developer. But Hendershot’s childhood love of radios, as it turned out, perfectly coalesced into Radio Design Group, a Southern Oregon-based tech consulting and manufacturing firm.

“Look around,” Hendershot says with a sweep of his arm around his corner office. “If it’s wireless and doesn’t use Morse code, it’s a radio. See this phone? It’s a radio. See that computer? It’s a radio. If there are no cables and no laser beams, it’s a radio. It’s all over the place. It just is.”

Which more than anything else explains how a small consulting business in Grants Pass, Oregon could become a significant player in the high-tech electronic space that services any number of companies, including the United States government.

slideshow2-techBased in rural Rogue River, Oregon—situated between Grants Pass and Medford with a population of just over 2,000 people— Radio Design Group, Inc. started out as Hendershot’s solo consulting business in the 1990s. It expanded until the peak of the Great Recession when high-debt and expensive innovation conspired against the business.

Just last year Hendershot sought Chapter 11 bankruptcy protection to reorganize the company’s debt, which included a new $5 million, 22,000-square foot facility on the banks of the Rogue River.

“Our commitment to a very forward looking technology took longer to develop than anticipated,” Hendershot said, “coupled with our commitment to the customer to make it happen, even though it put us in a very difficult cash-flow position.”

The company created a wireless intercom system that took its toll on cash flow, according to published reports. Hendershot said the company had to seek Chapter 11 bankruptcy protection so it could reorganize its debt and level out the cash flow.

“The product has been immensely successful,” Hendershot said. “So its rollout, coupled with our other business opportunities, has resulted in a better than expected timeline (to come out of bankruptcy protection).”

“Ultimately, I have to give credit to the people who work here,” Hendershot said. “All the way from top to bottom, our staff stood behind us, stuck with it, and made it all happen. Without their substantial efforts, this could have easily been a business failure, rather than a success story.”

Lobby01Radio Design Group employs about 25 with good wage jobs that attract people with highly specialized skills from all over the country. The new facility offers badly needed room and facilities to increase revenue.

Despite the most recent struggles, Hendershot is optimistic.

“We took on a bunch of debt, but it is definitely worth it,” he said. “We have stumbled into a market that’s just huge.”

Again, just look around you to see all the products using radio frequency technology that Radio Design excels in, to grasp just how huge the market is.

Radio aficionado

Jim Hendershot’s professional career starts and ends with his basic childhood love of radios, which is the one thing that makes this otherwise sparsely decorated, modern facility with state-of-the-art equipment unique. Hendershot has old radios in his office and a few more are in the halls. His obvious connection to the basic foundation of his business can be seen in his 1950s German-built radio and a 1939 Zenith.

slideshow2.4In various offices throughout the building, workbenches that look like a child’s erector set or a musician’s sound board show evidence of perpetual tinkering. Hendershot points to various objects that are completely unique to his field, some his company created.

None of this was the plan, according to Hendershot, who simply hoped he could make a living doing what he does best as an engineer who likes to play with radios. After moving from California to Rogue River, Hendershot figured he’d do what a lot of out-of-work engineers would do: start a consulting radio frequency consulting business.

“I thought ‘I gotta do something’,” he said. “I figured there’s not a lot of guys doing RF design, so I hung my shingle out.”

Even then it seemed like an odd twist on the economic shift to high tech. Like many markets excised by the changing of the times, radios were headed toward museums before Hendershot started his business.

“Radio frequency was a disaster for many years,” he says. “That all changed with the cell phone.”

Cellphones, once bulky and hardly mobile (“a brick,” Hendershot says), changed everything about modern communication largely because of radio frequency technology. No matter how sophisticated they become—with new terms like NFC, GPS and Bluetooth to describe them—they rely on the same old receiver and transmitter technology that brought us AM and FM radio dials.

The science reaches back into history, where men like John Forbes Nash, captured in the movie A Beautiful Mind,  developed mathematical theories that developed transmitter technology. Then in 1973, Motorola Vice President Martin Cooper made the first cell phone call in 1973 on the phone he invented. His first call went to Bell Labs, a company also trying to invent the first cell phone.

“Cooper’s call did more than untether people from their fixed phone lines; it opened the door to true mobility and continues to affect virtually every aspect of our lives,” Roger Cheng wrote for CNET.

“As soon as cellphones happened, wireless took off.” Hendershot said. He took off with it and hasn’t slowed down since.

Communication solutions

The business is different from many because it thrives on the temporary nature of a problem. Radio Design Group helps engineer solutions, fix existing problems with technology and/or design products other companies need.

“That was our original market niche. We’ll design your product. You’re going to make it,” Henderson said.

But demand to build the products grew so the company expanded into manufacturing.

The focus is always on the function despite potential higher costs, which is a common problem in high-tech. Hendershot sounds like Apple Founder Steve Jobs with a similar relentless pursuit of exceptional quality with an eye on price, but not the other way around.

“I think Jobs was able to strike a good balance. I try to do that. But there’s a certain part of that which makes me a high-priced option. We’re the higher end, but our products work very, very well,” he said.

He believes that pays off over time, much as it has for Apple, with overall cost-effectiveness and a higher level of performance.

“Systems for the U.S. Navy that are hundreds of thousands of dollars each can be very complicated. But we are very capable,” he said.products-image

Rogue River

Hendershot realizes a rural map dot along Interstate Five, nearly four hours from a major city, is not the most likely venue for a niche-driven tech firm, much less a manufacturing plant. But he says the location isn’t the problem people would think.

“If I was in the Bay Area, I’d still be looking in Boston and Los Angeles for people. You never know where they come from,” he says.

The bigger problem has been a certain level of anti-tech bias from local governments that have had bad experiences with tech companies failing. Hendershot believes all governments, from the local city to the federal government, try to pick economic winners and losers. Their track record, he says while citing notable busts like Solyndra, leaves a little to be desired. He doesn’t hide a libertarian streak, especially when it comes to government meddling.

“If you own a business and have to pay taxes you tend to become a conservative,” he said.

But his commitment to the town of Rogue River remains firm and the company’s future weighs on his mind, especially as it emerges from its biggest threat to date.

He knows the potential is significant, both in terms of revenue and potential suitors. He is mindful of it, but relishes that he doesn’t have to focus on running a business and solely making those decisions.

“The ugly truth is I don’t run this business,” Hendershot says. “I’m an engineer. I have hired good people and let them do their jobs. I set the tone and direction. I will occasionally weigh in on management decisions and I do some inevitable customer relationships because I’m ‘the boss,’ but mostly I’m still an RF engineer.”

He knows his children have no interest in making this a “family business.” He is aware of the need for an exit plan, though it’s not top of mind.

“I love my job,” he says. Though he admits, “I frequently explore offers. Nothing completely satisfactory has presented itself yet.”

Hendershot says the exit plan focus can be a trap for many entrepreneurs who are focused on the profits more than the work. This gives him an edge. He’s in no hurry to do anything with the business other than keep working to make it the best it can be. He still gets to do exactly what he does best.

“My wife says ‘you play all day and they pay you for it,’” Hendershot says. “The sad truth is it’s true. I played with radios as a kid and I still play with radios now.”

Front010

For more information visit www.radiodesign.com.

The Wine Left Behind: How Rogue Creamery became a global cheese leader

Screen Shot 2015-04-22 at 9.10.46 AM

A while back, just after the imagined calamity of Y2K and the real calamity of 9/11, a Harry & David vice president and a microbiologist thought it would be really quite nice to restore a historic building in Ashland, Oregon and open a wine and cheese bar. With renovations underway in the city’s boutique Railroad District, they decided to connect with a local cheese vendor. They were convinced celebrating all things local would be a hit. It seemed like a good plan.

They decided they didn’t need the wine. The restoration stopped and a new business plan was launched.

“I was taken by the craft of cheesemaking the first day,” says Harry & David veep turned Rogue Creamery President David Gemmels.

Cheese connoisseurs are equally taken with the legacy cheese products founded by the Vella family during the Great Depression and elevated to a new level of excellence under the leadership of Gemmels and his partner, CEO Cary Bryant.

10636092_10152673844163737_4746405383185978910_nRogue Creamery’s signature product is its line of blue cheese, which has a list of accolades that reads like Meryl Streep’s IMDb page. Caveman Blue was named one of the top 60 cheeses in the world—a Super Gold Winner—at World Cheese Awards in London in 2014. Pile on a host of other awards, write-ups in standard bearers like The New York Times, distribution on the menus and shelves of cultural food mainstays like Bi-Rite Creamery in San Francisco, and you get a sense of the heady acclaim of the rural Oregon cheese company.

Some even argue that Rogue Creamery’s success and influence extends to the entire artisan food movement that is so pronounced in Oregon.

“The owners of Rogue Creamery created the artisan movement in Oregon…” Katy Coba, director of the Oregon Department of Agriculture once said. “They are the real reason why Oregon’s artisan cheese makers are so successful.”

Gemmels, 54, doesn’t hide his surprise and dismay, brushing away with a laugh any notion that all of this was somehow part of a designed master plan.

“We thought we’d open a cheese and wine bar and make cheese a few days a week and life would be great. This just kind of took over. Now, there is no stopping our commitment to this business.”

Recession proof

Not lost on its owners is the reality that this business that started in the midst of the Great Depression has thrived in the midst of a Great Recession.

“It’s resilience through this economy is amazing,” Gemmels says. “We’ve seen its resilience move between food service and full-service deli and direct to consumer and it keeps unfolding.”  10320935_10152776379338737_3979196385482581151_o

Just what is it about cheese that is so recession proof?

“It’s sustenance,” Gemmels says simply. “It’s what truly brings people to the table for conversation. And it’s not only a food, but it’s also something we put in that category of desirable food.”

Get him talking about the aura of cheese and Gemmels hits a different level, switching artfully from the prose of business to the poetry of artistic creation.

“Cheese is mindful, healthy, stored energy that’s been cultured and aged to perfection and its complex in experience that delivers just that … an experience,” he says.

This complexity attracts Gemmels anew regularly, he says. He never lost the enthusiasm he felt that first day learning how to make cheese from former owner Ignazio Vella, a man the company refers to as “The Godfather of Artisan Cheese Industry.”

Replication and evolution

Those first days were long days for both Gemmels and Bryant as they took the family recipes and knowledge of how to make its signature cheese from Vella, who in turn learned directly from his father. Rogue Creamery Founder Tom Vella worked with cheese his entire life until his death at the age of 100.

Screen Shot 2015-09-14 at 12.17.33 PMGemmels says that family legacy, the pride of place, and the recipes themselves attracted them to the business.

“These are brands we grew up with in the Pacific Northwest,” Gemmels says. “We felt it was necessary to preserve those recipes. Both Cary and I shared fond memories of those cheeses being stocked in our family’s refrigerators and enjoyed at meals.”

It was a long tradition that Gemmels and Bryant were determined to honor. The pair worked nearly every day for four straight years, Gemmels says.

The problem, as any Italian kid can relate to, is transferring those intrinsic and artistic recipes into a repeatable, scientific, accurate formula that could be perfected and repeated.

“There were a lot of variables,” Gemmels says. “We wanted to narrow that and understand how to control the quality of the cheeses.”

Gemmels said the task of documentation fell largely on Bryant, a microbiologist by training. “We had to document the recipes, the temperature, the pH levels, the salt and all of the ingredients, the Affinage (a French word for the aging and curing of cheese) and understand the cheese through its life at Rogue Creamery.”

Screen Shot 2015-09-14 at 12.23.31 PMIn this arduous process both men became more than business owners. They became cheesemakers, starting with two recipes that had been used for seven decades, Oregon Blue and Oregonzola.

“The recipes for the two cheeses that Rogue Creamery was making when we purchased the business are basically the same formulation now as they were then,” Bryant says. “Of course since then, with cheesemaker classes and advanced training, we have developed our own recipes for seven new blues we produce. We wanted to stay true to the original cheeses but we also wanted to have new recipes that introduced our flavor profiles and interests and also the terroir of our region.”

They set a very high bar, one Gemmels says remains the guideposts for all the company does.

“We have quality standards that are really high,” he says.

The two men and one employee grew into a business than now has more than 50 employees, each dedicated, Gemmels says, to maintaining those guideposts of excellence. Budding cheesemakers now go through a seven-tier, multi-year training process to ensure the exacting standards and the rapid company growth.

“The business continues to unfold,” he adds.

This unfolding includes a new line of fresh cheese, like mozzarella and burata, ice-cream bases, and even its own ice cream that will launch around press time. Look out Ben, look out Jerry. Here comes Dave and Cary.

Poetry is infectious around Gemmels.

The ice cream was developed in connection with Oregon State University. It will feature Rogue Creamery’s “milk profile,” as Gemmels calls it, and will celebrate the local pride of place that is never far from Gemmels’ thoughts. Honey is the future ice cream’s sweetener of choice, with a custard base. Flavors will include local chocolate, Oregon nuts, local berries and local names like “Pilot Rock Swirl,” he says.

The growth fuels the owners’ passion that spills over into charitable giving, a novel bike commuting incentive plan and careful focus on environmental protection, despite a massive new investment in the construction of a dairy farm in Grants Pass. Cows have long been on the opposite side of environmentalists, earning scorn for their gassy contribution to global warming and their heavy-footed trampling of the ground, among other criticisms.

Sustainable dairy overcomes ‘bad rap’

So, about this “sustainable” dairy farm…

Gemmels is unflinching, even quickly offering a must-read book for those serious about the issue called, Cows Save the Planet, by Judith Schwartz.

“The rap is false. It’s not proven. They do generate some gas with every burp,” he says with a laugh, “but it’s certainly in no competition with the automobile and with other fossil fuels.”

The Rogue Creamery dairy farm will be an “eco-cathedral to cows,” he says. More importantly it will Screen Shot 2015-09-14 at 12.20.05 PMcontinue the method of production the business uses that unveils its process to the viewing public, “from start to finish,” he says. “Our vats are visible in the Rogue Creamery store. Our cows are visible from the Rogue Creamery dairy.”

The cows are tended by two robots named Matilda and Charlie, Gemmels enthuses, “in a healthy, happy environment.” They are grazers of the local land running adjacent to the Rogue River that imparts the local flavor.

“The beautiful thing about our mix of browns, Holsteins and few jerseys here and there,” Gemmels says, “is that we have that wonderful composition of butter fat and creams that is a signature for Rogue cheeses.”

The cows do their part to help the environment by building needed top soil that sequesters carbon in accordance with the principles of Schwartz’s book.

The eco-cathedral to cows will “showcase an organic dairy that is offset by solar power that creates inspiration for the next generation of farmer that can manage it with an iPhone and using the technology of today.”

Long way from a wine and cheese shop

Exactly the opposite of the slow, intricate process that ages cheese is the frenetic pace of the business growth. Further expansion is inevitable.

“The business is at that stage of growing beyond our comprehension, which is so exciting for us and our community,” he says. “We see the next stage as bringing in some partners that will help us move it to that next level sustainably.”

Gemmels embraces the growth so long as future partners embrace the focus on community and the exacting standards necessary for a globally recognized cheese. The benefit of growth, Gemmels says, is more employees with a livable wage and a positive working environment, which impacts every level of the business, including the cheese, he insists.10688371_10152978880398737_1293249453000364515_o

“You can truly taste that in the cheese; the energy you have and impart is reflected in that. You see it on our cows.”

What might strike some as unbelievable may as well describe the whole story of Gemmels, Bryant and Rogue Creamery. Gemmels still can’t believe it himself, he says.

“It just continued to evolve and unfold into numerous accolades throughout the world, noted as the finest blue cheese in the world and judged as such,” he says. “I’d never thought I’d be a cheesemaker nor a dairy farmer. I just stayed true to the concept of contributing to a sense of place and touching the people in it.”

For more information, visit www.roguecreamery.com , like them on facebook, and follow them on instagram and twitter

 

FCC gets lean to compete on global stage

fcc3

Though a prominent player in the fast-food industry, FCC Commercial Furniture in Roseburg, Oregon, is anything but quick and disposable. The company enjoy decades-long relationships turning blank spaces into restaurants for industry leaders like Taco Bell, McDonald’s, and Burger King. Before a burger or taco is served, FCC has transformed the space into its signature and efficient look.

“We provide the entire design package, from concept to idea, all the way through manufacturing and install,” said Preston O’Hara, FCC general manager. “It’s a turnkey operation.”

For nearly fifty years, FCC has provided the ever-changing look of notable operations, like southern California-based In-N-Out Burgers. O’Hara estimates the company does close to twenty percent of all new Burger Kings and 15 percent of all new McDonald’s.

“We take that building shell and we fill it with products, a lot of which is custom designed,” O’Hara said. “We manufacture everything here.”

FCC began in Oxnard, California. Founded by Robert Crowe, FCC continues to be a family-owned business with sons Scott, Mick and Gary Crowe. The Crowes moved FCC to rural Roseburg in 1993, largely for the quality of life. The business continued to thrive.

Gary Crowe is currently the CEO and Scott is head of research and development.

DSC_0499-a1On site the company has an upholstery shop, a fiberglass shop, a metal shop, and others all under one roof covering 150,000 square feet of operations.

“We have a lot of cool machinery,” O’Hara said.

When O’Hara mentions “turnkey” he means it, stressing every detail is made right there in Roseburg.

“Right down to the garbage can with the ‘thank you’ door and the trey catch… it’s all built here,” he said.

Despite the similarity of say a McDonald’s in Hartford and a McDonald’s in Honolulu, each store has its unique needs and design. FCC caters to franchise owners with urgent needs of budgets, timelines and stresses.

“It’s an interesting business to be in with a constant state of change in design,” O’Hara said.

Diversification and competition

Despite a bucolic lifestyle in southern Oregon, global economic pressures and manufacturing competition demand vigilance, O’Hara says.

“Being in this industry there’s a lot of pressure to buy things in China and outside of the U.S. We fight to stay competitive despite the price pressures we have seen.”

The company currently has 115 employees that includes a large design department of college educated professionals, recruited from around the nation.

“Expectations are also high. It’s not a company where you can go through the motions,” he says.1795520_10152360075928515_2487356907202713326_n

Despite its longstanding relationships with global corporations, FCC had to weather and evolve during The Great Recession. It was not immune to cataclysmic changes in the economy.

After “record years” in 2007 and 2008, “everything changed,” O’Hara said. “We saw a huge decline over 2009 and 2010. Access to investment dollars for our customers went away despite their excellent credit. That was certainly something we didn’t expect to see, because this is an industry that is fairly resilient to downturns in the economy. That wasn’t the case this time around.”

Though the business has rebounded in recent years, it remains highly volatile. After another record year in 2012, O’Hara said the company has seen revenue slide over the past three.

“But we’re looking towards a recovery in the year ahead and next year,” he says.

The volatility of the market has helped the second-generation family-owned business retain its competitive edge.

fcc6“Diversity makes you stronger and gives you perspective,” says O’Hara, who was promoted to general manager after rising through FCC’s human resources department. “If you survived through ‘The Recession’ you gained perspective that you need to plan a whole lot better and strive that you stay away from that spot again. For us, we’ve been resilient, we’ve been around for a while, but we’re even more resolved toward diversifying.”

Diversification includes expanding into retail markets outside of the fast-food industry. The company is close to finalizing a large contract with a major retail vendor that will significantly help 2015’s revenue. O’Hara said the company has begun to court and provides retail fixtures and displays for the likes of Nike, North Face and Columbia.

And a silver lining of the recession has been the slow shift of manufacturing back to the United States.

“I wouldn’t say that the price pressure ever goes away,” O’Hara says, “but people are frustrated by Chinese-made products. There are reasons for that. We won’t deviate from producing quality products and providing outstanding quality service. That’s what we are founded on. At the same time we have to drive down our prices.”

Concentrating on culture

Price pressure, diversification, competition. All common phrases in the business economy, but another go-to-point of emphasis sets FCC apart in O’Hara’s mind: culture.

“The thing you will hear us talk about more often than not has to do with our culture and our people. It’s something we hold near and dear. It’s special. It’s amazing how much you can get from people when you promote excellence. We don’t tolerate negativity. We believe in having fun at work. It’s one of our core values.”pics (11)

If you can have fun during a recession while facing stiff competition from Chinese manufactures, that’s saying something, but O’Hara says despite the challenges, the company’s optimism and workplace environment has remained the gold standard of how it operates.

“Most companies have to have the basic benefits, wages, retirement, but what separates you from others is your culture. We have flexible work schedules, free gym memberships, we have a lot of company parties and barbecues. We stock free ice cream and soda all year long.”

Owners are hands-on and approachable. The management team works together and set a tone of allowing employees to be creative. An entrepreneurial culture is encouraged.

“So even though it’s a manufacturing facility we don’t micromanage,” O’Hara says. “Be unique and do it different. That’s what we’ve tried to do. Create things that separate you from others. It’s a relationship. If you know you are valued and appreciated as a person, you generally give a hell of a lot more.”

Getting lean

Change is inevitable, O’Hara says, despite the company approaching its 50th anniversary in business. Change is disruptive, which can be both positive and negative. O’Hara understands that, but insists that FCC will remain on the cutting edge.

pics (29)To that end, FCC has invested heavily in shifting its processes to Lean Manufacturing, a new trend that changes the ‘batch and queue” mass production process that has dominated for decades, in favor of product-aligned “one-piece flow” pull production, according to the Environmental Protection Agency website.

“This shift requires highly controlled processes operated in a well maintained, ordered, and clean environment that incorporates principles of employee-involved, system-wide, continual improvement,” the EPA writes.

O’Hara says the shift is a significant investment in both machinery and employee training, but one that will help the company be more efficient, greener, and more cost-effective.

“Any time you implement change it is not easy,” he says, “and it comes at a little bit of a disruption at first. But at the same time it will be productive at the end. Any time you empower your workforce to make things better it’s positive.”

The bottom line for both FCC and for its customers is that they will benefit, he insists, by the company’s relentless pursuit of reducing cost.

“That’s how you deal with the price pressure, because it’s always going to be there,” he says. “You meet it head on through efficiency, engineering, and creativity.”

In short, you never stop changing. FCC will continue to evolve in order to compete, O’Hara says, while reaching outside of its core business model to diversify revenue.

“This place needs to look different. It better look a heck of a lot different in ten years,” he says. “If you aren’t changing and growing you’re probably not going to be around.”

fcc9

For more information, please visit www.fccfurn.com, like them on Facebook, and follow them on Twitter

 

Localvesting in ice cream and craft beer

Hatch-Oregon-Launch-1

The Silicon Valley has nothing on its little sister to the north when it comes to innovative laws for connecting small businesses with the investment they need to make a big step. Deep within Oregon’s Silicon Forest, laws passed earlier this year have opened the flow of investors to varied businesses throughout the state.

Hatch Oregon, a nonprofit incubator founded by Amy Pearl, worked with state lawmakers to develop Community Public Offering (CPO) rules that promote innovative, online investing engagement, similar to crowdsource funding that has become all the rage. Hatch Oregon’s CPO is similar in that the far reach of numerous small investors can mean significant investment dollars for Oregon businesses looking to grow. However it’s unique in that investors aren’t donors; they are given a return on investment either through loan repayment or equity in the company.

Screen Shot 2015-06-30 at 9.53.31 AM“It’s just a more balanced approach to economic activity,” Pearl said during a gathering of the first wave of businesses seeking funding through the new program. “The CPO creates a real stakeholder economy.”

Under the law, Oregon businesses can raise as much as $250,000 through crowdfunding on the Hatch Oregon site. Each individual investor can donate a maximum of $2,500. Like the company itself, the investor has to be based in Oregon. It’s Oregonians investing in Oregon business at the purest level.

Taking the leap

Two Eugene-area businesses that represent the state’s ethos of local sustainability—Red Wagon Creamery and Agrarian Ales—are among the first round of companies seeking funds through Hatch Oregon.

Red Wagon Creamery Co-founder and Director of Sales and Marketing Stuart Phillips said the investment program beats the traditional lending model of “going hat in hand to the bank and taking its terms.”

“The difference between this and traditional lending,” Phillips said, “is you get to decide if you want to do debt or equity or combo thereof. The entrepreneur is the one driving the train. Also, the entrepreneur is the one to set the terms of the deal.”

10382071_666903713378547_1731539791957626672_oThe owners of Red Wagon Creamery, an exploding ice cream company that started with a cart and is now developing expansion plans into southern California, wanted to limit debt during the large expansion of its operation. Taking on small investors allowed that, while also boosting local interest in the company’s success.

“We will end up getting more than a hundred Oregonians becoming brand ambassadors of our ice cream,” he said of those who have bought CPO shares. To date the company has raised more than $70,000 toward the $120,000 sought.

“They have invested in us and own a little piece of the company. They have a vested interested in our success. We like that. It ties into our local food ethos,” Phillips said.

Agrarian Ales has also gotten off to a strong start in its CPO. To date the company has raised about 36 percent of the $165,000 offering that the unique farm-based brewery will use to build the region’s first micro-processing facility specific to the brewing industry.Screen Shot 2015-06-10 at 7.56.47 AM

“We are ready to put down even more roots in Oregon by setting the stage to revitalize on-farm, micro-processing to make our endeavor absolutely local,” the company states in its offering document.

A strong start

Since launching at the end of January, Hatch Oregon has topped more than $200,000 in total investment. Though not the first, Oregon’s CPO has quickly become the model to follow compared to other states that have yielded more lackluster interest and investment.

“Oregon may not be the first state to pass such a law—it followed at least thirteen other states that have allowed investment crowdfunding within their borders. But it’s easily the fastest out of the gate,” wrote Bruce Melzer in an article on Locavesting.com

The secret sauce may well be the spirit of the businesses more than anything else. Those seeking funds are steeped in the cultural ethos of best practices, local investment, local vendors and healthy products.

Riding the wave of its initial success, Hatch Oregon will host a nationwide conference in September in Portland to help spur other states based on what’s working in Oregon.

Made in Oregon

Ever since the migration of Californians fleeing urban commutes and exorbitant real estate prices a generation ago, pride of place in Oregon has been a staple. Oregonians still discuss with a small measure of pride the famous quote in the 1970s from then Gov. Tom McCall who encouraged Californians to visit but, “for heaven’s sake, don’t move here to live.”

The often mythologized statement spawned a bumper-sticker and T-shirt craze stating, “Welcome to Oregon. Now go home.”

Most of the businesses to use Hatch Oregon’s funding platform are similarly old school – they are product, not tech, driven—but cutting edge with the type of products they offer. They want to scale, but do so with a focus on sustainability.

“We are not only buying our ingredients locally and supporting local farmers,” Phillips said of Red Wagon Creamery, “but now our profits are going to Oregon investors.”

Red Wagon started when the owners recognized the value of the growing interest in food carts and trucks, which Phillips says “was just becoming a thing.” It dovetailed nicely with the model of Ben and Jerry’s Ice Cream—in its early, privately owned years, Phillips stresses—who started selling artisan ice cream in Vermont.

“They took their traveling road show around to get Vermonters to invest. We really liked that. We liked that part of that story,” Phillips said.

The company’s ice cream cart has grown to a retail store in Eugene, two carts, a tricycle that sells popsicles and Oregon’s smallest certified dairy plant, which is just 200 square feet.

Revenues grew from just under $100,000 in 2011 to more than four times that in 2014. But the former lawyer turned ice-cream vendor says the true value of the business remains the joy of the product itself.

“There aren’t a lot of jobs you can have where you give someone the product and they immediately look happy,” said Phillips.

Rather than expand its distribution network to ever increasing distances from the Eugene operation, Red Wagon has decided to re-create the entire operation in other locales so as to both invest in the local business climate and community — and to reflect the local flavors. Since Eugene covers Oregon and Washington, the company will next expand into southern California.

“We did a lot of brainstorming on how we can take what we’re doing and essentially scale local food and have it still be local,” Phillips says. “An ice cream company back East makes local ice cream then ships it all over the country. By the time it gets out here you’ve kind of lost that local connection.”

He calls the added expense a “necessary sacrifice of profit to make the company what it needs to be, which is really a showcase of what’s local.”

In Palm Springs, California, the company has already identified its local farmers, the farmers markets it will sell from, and the products that will offer distinctive local flavors not offered in its Oregon location, like avocados and citrus.

The five-year plan is perhaps five locations along the West Coast.

“Beyond that, we just gotta see,” he says.

Central to that plan has been the public offering through Hatch Oregon. He encourages other businesses to pursue it, but to understand the work that’s involved, which includes crystallizing your company’s vision and promoting that at all times. Phillips says he talks up Hatch Oregon while scooping ice cream.

“It’s a great program as long as you come into it with your eyes open,” he says. “It’s a rare business indeed where people are lined up willing to give you money.”

Red Wagon now has 25 employees and a goal to create hundreds of jobs moving forward.“It’s daunting for us as we think back to two of us in a kitchen,” Phillips adds, which wasn’t all that long ago.

Farm-to-Pint brewing

It’s hard to get more “old school” than an Oregon farm and it’s hard to get more Oregon than craft beer making. But it’s truly trendsetting when you take those two elements and combine them on the same location, creating what may be the first completely local farm-to-pint brewing operation.

11393640_889764841102421_2562466777791118830_o“Agrarian Ales has solidified our position as one of Oregon’s most unique breweries, growing 100% of the hops, herbs, fruits and vegetables used in our beers and sodas,” states the company’s public offering. “In time, Willamette Valley farm-grown crops will comprise 100% of the raw ingredients processed at the facility…Oregon’s first, true estate brewpub (and potentially the first in the entire country).”

In addition to a working farm, Nate and Ben Tilley spent the past eight years renovating the old barn on the property that dates back to World War II into a vibrant microbrewery. The operation now includes a “table-at-the-farm” restaurant, as they refer to it, which is open Fridays, Saturdays and Sundays and touts a menu “comprised of 98% Oregon-grown ingredients, most of that within five miles of the brewery.”Screen Shot 2015-06-10 at 8.03.01 AM

“When I met the Tilley boys and came out to this farm for this first time it was kind of a dream come true,” says brewer Tobias Schock. “The driving philosophy behind the creation of this business is to keep a family farm alive and well and thriving into the next generation.”

Nate Tilley started brewing in his garage and said the growth from sales of the beer took off through word of mouth praise.

“It seemed very simple to take that to the next level,” Nate Tilley said. “My dad proposed the idea of using the barn. We hadn’t had the thought of putting a brewery out here in this rural setting.”

It’s an innovative idea that works as the farm has turned into a similar destination experience not unlike people who venture into rural areas to visit a winery. In short, it’s very Oregon, which is the point of the CPO from the outset and perhaps the most telling reason why the CPO has, at least so far, become the envy of states all across the country, including the Silicon Valley itself.

Screen Shot 2015-06-10 at 8.03.35 AM

For more information on Red Wagon Creamery, visit www.redwagoncreamery.com, like them on facebook, and follow them on twitter

For more information on Agrarian Ales, visit www.agales.com, like them on facebook, and follow them on twitter and instagram

For more information on Hatch, visit www.hatchthefuture.com, like them on facebook, and follow them on twitter

Building a world-class MEMS foundry in the Rogue Valley

430174_402088069817237_1244004967_n

Building technology, as it turns out, might actually be easier than inventing it.

“Easier” is not the word Rogue Valley Microdevices cofounders Jessica Gomez and Patrick Kayatta would choose. But when the husband-and-wife team wanted to launch a business in their field of expertise, it came down to making other’s inventions or trying to launch one of their own.

They opted to make stuff—really complex, precise, high-tech stuff—in contrast to the high-dollar, high-wire investment common in micro-processing. In so doing, they launched a one-of-a-kind business that has solidified its niche.412791_379795092046535_1218187416_o

“Our business model isn’t the typical startup business model based on emerging tech or a new product launch, which a lot of times comes from working on technology in the university,” Gomez says. “Eventually patents are filed and they’ll do some proof-of-concept work and start raising money. If they are lucky and tenacious they’ll get funded eventually. Then the clock starts ticking. They have five years maybe to get that product to market. It’s very difficult. Our model is different.”

The decision likely meant more work, longer hours, and a gut-wrenching level of risk, but it has paid off how they both hoped, with steady work in a place they wanted to raise a family.

Gomez, 37, Rogue Valley Microdevices CEO says, their company is the only microelectronics manufacturing facility in Southern Oregon.

“We build other entities’ projects,” Gomez says. Customers include universities, hi-tech companies, even startups. “Really anyone who is lacking the ability to manufacture the chip that they have designed or need.”

Asked where the competition is, Gomez says, “Taiwan.”

415767_379781772047867_2048210312_o“This is becoming more difficult to do in the U.S., but there is a strong market for it. It’s the story of the U.S. with all these companies building this disruptive technology. But once it becomes a commodity it goes offshore.”

Global competition is fierce. But relative proximity to American companies and universities has its advantages as well. In some ways, this Southern Oregon company is the best local alternative.

From New York to Ashland

Gomez and Kayatta first met during the late 1980s when both worked at Standard Microsystems Corporation in Long Island, N.Y.

Gomez started as a minimum-wage lab operator on an assembly line. Boredom motivated her to educate herself in other aspects of the business like manufacturing, processes and software configuration.

Kayatta was recruited to a startup in Los Angeles. Gomez followed. They saw first-hand the perils of the startup culture when the business eventually shut down. The couple then decided to go into business of their own.

The big decision was where.

“We thought about staying but the cost of operating a facility there it didn’t look financially doable,” Gomez says.

They thought about going back to Long Island, which also was cost prohibitive. Florida? Wasn’t a good fit, they thought. Finally, Gomez started thinking about Southern Oregon for its proximity to the Bay Area and Portland and its relative cost of living. It didn’t hurt that she had lived there for a while as teen and still had family there. She hadn’t loved it back then, but now with a family and a business in their plans, it grew on her.

The favorable business culture, especially assistance from Southern Oregon Regional Economic Development Inc. (SOREDI), sealed the deal.

SOREDI is a non-profit organization tasked with developing business prosperity in Jackson and Josephine Counties. It offers services including assistance in site selection, permit applications and access to capital. For Gomez and Kayatta who were making repeated trips up Interstate 5, the help from SOREDI was enough to leap in and make the move.

The couple invested everything they had. SOREDI took a second position on the bank financing, which mitigated the bank’s risk and helped secure the loan.

“That’s the only way we could fund the company with the start-up costs,” she says.336818_508217062537670_2104100553_o

They set up their first clean rooms and got to work.

“We started really basic. We did two types of films. We had maybe 500 to 1,000 square feet of clean rooms and started making money,” Gomez recalls.

She estimates that the monthly budget demanded about $14,000 in revenue just to survive and keep up the lines of credits they took. Credit card debt grew as well. So did their work hours.

“It’s sort of out necessity right?” she says. “Because we don’t have the ability to have this big multimillion dollar exit. It’s not attractive for an investor to put a bunch of money into this company, so we just kept putting it in ourselves. We wanted something that was going to be around for many years.”

They succeeded. The business has enjoyed steady growth and earned a reputation for quality and attention to detail that is critical in microdevice manufacturing.

“We didn’t have the option to fail. We took everything we had, our income, our house, our credit into this company. We lived off Pat’s 401K working 18 hours a day,” Gomez says. “The first five years were really tough. We’d basically sleep here.”

But perhaps the biggest accomplishment is they survived with their marriage intact.

“We had no idea what we were getting ourselves into,” Gomez says. “I was 25 when we started this company. It was two of us. We didn’t have a team of engineers.”

That common sense focus still guides the company, she says. They continue to focus on what they do very well. They don’t worry about the mega deals that happen in other companies, like the recently announced billion dollar super merger between Spansion and Cypress. That’s not their business model and it’s never been their goal, she says.

“That big giant pay-off for us is not as important as steady jobs,” she says.409281_379774998715211_1537131771_n

Often it’s inevitable when a company scales up its technology and begins mass production for it to take the work offshore. Prior to that expansion is a niche where Rogue Valley Microdevices excels.

“We are supporting a lot of this cutting edge stuff that we don’t want to introduce to a foreign environment especially in those beginning,” Gomez says.

Building Southern Oregon tech

With the business more secure and a team of roughly 20 employees, the work hours remain long but the survival stress has abated. Gomez has begun to connect with others to offer what help she can. She also wants to help generate funding for other startups, which will help the nascent tech corridor in the Rogue Valley grow, recruit a strong workforce and improve the community’s economy.

339083_379797188712992_793926256_oThe region’s tech culture doesn’t have a lot of depth, but it does have “one of everything,” Gomez says. The diversity of tech interests and culture isn’t common in a rural area.

“We are all very unique so we have to do it in a unique way,” she says.

Part of that is continued work with SOREDI and other public and private agencies seeking to boost the innovation economy. She helped start the Sustainable Valley Technology group to help develop resources for entrepreneurs. Jackson County came aboard as an initial funder with an investment of $50,000 to help attract and assist high-tech, clean energy businesses.

“We thought this was the best and brightest idea we’ve heard in a long time,” Commissioner C.W. Smith said.

The focus of the group is to help provide office space, support services and venture capital for emerging businesses, a Jackson County press release stated.

“I’ve been working a long time to develop resources for startup companies. I believe that’s critical for our local economy,” Gomez says.

She also serves on the state workforce board. She’s well aware of the obstacles for the region.

“It’s hard to find really good well qualified employees to hire in any of these companies. I thought we were unique but I hear stories and I don’t think we are.”

Next steps

Plans for the future look very much like the present. Hard work, excellent quality products delivered to innovative companies that need that specialized care Rogue Valley Microsystems provides.

Expansion is coming, but not in the form of a massive multi-million dollar merger or investment partner. It looks more like a larger building and putting into use more clean room space that is critical to increase production.

“We are pretty packed,” Gomez says. They recently purchased a $10,000-foot clean room that was decommissioned by Intel, she says, but they don’t have anywhere to put. That will have to change soon.

It’s all part of the original plan, the so-called easier way to launch a high-tech company in a rural outpost.

“We still want jobs and to provide for ourselves and make a decent living,” she says, for herself, her husband and their growing number of employees. Just like they started, it’s pretty basic, but in the fundamentals have come the success and perhaps a model for others coming to the region to follow.335885_379785108714200_1590338315_o

For more information, visit www.roguevalleymicrodevices.com, like them on facebook, or follow them on twitter and LinkedIn

Brand defines Tucker Sno-Cat’s edge

Screen Shot 2015-04-22 at 9.20.19 AM

Few businesses so dominate a segment of the market that their brand becomes synonymous with the product. Think Kleenex. Or Coke, which is often used in place of terms like soda or pop. Sno-cat is one such brand and its unique place in large equipment is secured both in the brand and the fourth-generation-owned company’s place in history.

Just as hockey fans call all ice resurfacing machines “Zambonis,” skiers and snowboarders charging down groomed slopes refer to Sno-Cats – not track-driven snow vehicles – that cleared the way and prepared the hill the night before. The comparisons are deserved. Both the Zamboni Company and Medford, Oregon’s Tucker Sno-Cat invented the technology that still dominates their slice of winter service today.

Everyone at Tucker Sno-Cat understands the importance of that unique brand, said Sales Manager John Meilicke.

“It’s an advantage because when people talk about an over-snow vehicle, they do use that Sno-Cat phrase. It points them toward us because that’s who we are,” Meilicke said.

The company is ever-vigilant in protecting it.

“It’s an ongoing battle for us to maintain that trademark,” Meilicke said. “We are constantly finding where other manufacturers are using it.”

Company attorneys are quick to send “a nice, well-written letter,” to cease and desist.

The term Sno-Cat may be ubiquitous, but it still belongs solely to the family of the man who first invented track-driven snow vehicles nearly 70 years ago.

Historic technology

In the early 19th century, Lewis and Clark used canoes as a primary mode of transportation during their historic trek to the Pacific Ocean. Fuchs and Hillary, a 20th-century exploration team, used track-driven snow vehicles – Sno-cats – built by the Medford, Oregon-based Tucker Sno-Cat company for their transantarctic crossing, and securing the company’s place in history.Screen Shot 2015-04-22 at 9.18.17 AM

Company founder Emmitt Tucker Sr. trademarked the term “snowcat” in 1946.

“The Sno-Cat was his mastermind,” Meilicke said. “He was always thinking about flotation and ways to propel the vehicle. Some of the early experiments used an auger. But then he figured out the track-driven system.”

The first vehicles had two tracks in back and skis in the front.

“It evolved into the four-track, articulated steering you see today,” explained Meilicke.

The historic nature of this legacy company is a decidedly “made in Oregon” story. Emmitt Tucker hailed from Jump Off Joe Creek (which still has a sign on Interstate Five) and moved his company back from California to Medford before it truly took off.

“Southern Oregon was their home,” Meilicke said. “They went to Grass Valley, Calif. to get closer to San Francisco and machine shops that could help with manufacturing. But when it came right to it, they missed home and moved back.”

10986621_875074185885072_1035368990889115755_nWith their return, an Oregon institution was born. Now it remains a privately owned, fourth-generation, family operated business. Tucker’s namesake, Jim Tucker, is its current president. Meilicke said he doubts the family has any plans to sell any time soon.

“I don’t see it happening,” he said. “You see the passion and the drive they have. This is their future.”

Weather related

Meilicke’s winter is anything but hibernation, where sales and delivery of Sno-Cat machines to customers dominates his time. His rest, if there is any, comes in spring where he can test prototypes and plan for the coming sales cycle in a fiercely deadline-driven marketplace.

“Everybody wants their machine delivered before the first snowflake falls and you never know when that’s going to be,” he said.

Screen Shot 2015-04-22 at 9.17.58 AMOrders can be cancelled if not received by a certain date. Any cancelled order can mean a huge hit to the bottom line for machines that cost hundreds of thousands of dollars. Used Tucker Sno-Cats cost $100,000 and up.

“It can get a little hectic,” commented Meilicke.

Despite back-to-back years of dismal snowfall in the West, the East has endured brutal cold and snow. Demand for Sno-cats remains high.

“That’s why … I wasn’t able to stay right here in Oregon,” he said.

Even test-driving the prototype demands a drive over to Bend, Oregon, this year where the snow remains. Indeed, like all weather-driven companies, Tucker Sno-Cat remains somewhat dependent in the mercurial temperament of Mother Nature. At a time when global warming and climate change is a significant focus of global and political concern, Tucker Sno-Cat simply goes where the snow is falling.Screen Shot 2015-06-30 at 11.54.41 AM

The climate is one of the business challenges, Meilicke said.

“Everybody has their own opinion. Is it a trend, a cycle or global warming? For us it’s trying to find the areas that do require over-snow vehicles. We might not got a lot of snow here in the West, but in the East they had a lot of snow.”

Still nobody in the business of snow dares ignore changing weather patterns and the looming threat of global warming. The historic company recognizes its need for summer business. It has a separate sales cycle for agricultural machines. The vehicles have potential military use in desert sands.

“For sure, we’re definitely trying to diversify. That’s what stimulated the ag field,” Meilicke said.

Alaska in summer also presents fertile sales soil.

“Alaska has ultra-sensitive ground they don’t want to disturb,” he said. “We are one of the few that are certified to operate there.”

The Tucker Sno-Cat was part of an Alaska-based promotion, when a buyer painted the machine with the Seattle Seahawks logo to celebrate the team’s Super Bowl appearance in 2015. The colorful machine is used on Alaska’s North Slope to ferry people to and from the remote places they need to go, according to published reports.

Ironically, diversification proved problematic for a company so closely associated with snow. Again the Zamboni comparison seems appropriate. Imagine Zambonis that could level pavement. It’s a jarring image, just as the presence of Sno-Cat was at agriculture sales shows.

“Originally, they kept the Sno-Cat label, but in the end it proved an obstacle,” Meileke said. “Tucker Terra-Ag emerged just to get away from that Sno-Cat name, though the machines are the same and the principles of maneuverability on soft ground remains.”

Screen Shot 2015-04-22 at 9.20.59 AMThe Terra-Ag machine benefits farmers applying crop protection products that are worried about delicate soil being crushed by heavy machinery. The same technology that allows a massive machine to maneuver in deep powder works well on tilled soil.

The Model 1600 Ag Tucker Terra uses the same four track steering as the Sno-Cat. It comes with a three-ton capacity granular fertilizer tank and spinner spreaders. A 500-gal. spray tank with spray booms up to 90 ft. long is also available, according to sales distributor Track, Inc. The machine sells for roughly $250,000.

“The Tucker Terra has a very light footprint and really shines in soft ground conditions,” Rick Keith of Track, Inc said. “It … has been widely used in the grass and sod farming industry.”

Rising costs of regulation

In the end, the threats to this family-owned business really aren’t found in technology or climate control, but in old fashioned government regulation, Meilicke says, where Tucker’s problems are common to many large industrial machine manufacturers like Caterpillar or John Deere.

“The challenging thing for us right now is the EPA requirements,” Meilicke said. “In the future it’s only going to get more difficult. We’ve been able to meet those requirements. But you see those coming in the future and they are getting more strict. It costs a lot of money and that gets passed on to the customer.”

Tucker Sno-Cat employs 48 people. It enjoys modest growth. In the 14 years Meilicke has been with the company he believes it has only added 10 new positions.

“We are definitely producing more vehicles,” he said in a nod to increasing efficiency in the face of rising costs because, in part, of those EPA regulations and an ongoing investment in innovation.

Innovations, he said, revolve around uses, creature comforts and modernization.

“We’re constantly improving our equipment and upgrading with different kind of tracks and improved electronics. If you climb into the cab you’re going to see how we keep up with the times.” But, the basic four-track invention of company founder Emmitt Tucker remains largely unchanged, a proverbial wheel nobody sees the need to re-invent.

As Meilicke says,  “He got it done right the first time.”

Screen Shot 2015-06-30 at 11.51.23 AM

For more on Tucker Sno-Cat, visit www.sno-cat.com, like them on Facebook, or follow them on Twitter

Putting People Before Profit

Screen Shot 2015-06-03 at 2.15.30 PM

A Man and His Mission to Give It All Back

Tax day at Bob’s Red Mill turned out kind of slow when comparing it to most days, according to company founder Bob Moore, who took visitors around the Milwaukie, Oregon-based plant in his red golf cart.

Massive 2,000-pound bags of grains lined rows upon rows, moving through the spotless factory toward production and packaging. Stone grinders turned corn into corn meal in one area. In another, gluten-free products were being made. While up above, a small lab ensured their gluten-free purity. In still a different part, other machines packaged products for wholesale distribution. In a separate shop, workers fixed machinery. And in still another area were 25-pound bags printed with Bob’s trademark label.

“It’s usually busier,” he said over the din of the plant that operates 24-hours-a-day to ensure Bob’s Red Mill products are shipped to outlets across the planet.

Tour the plant with the 86-year-old founder and namesake of Bob’s Red Mill and you quickly notice how much he notices. No detail is too small for his rapt attention.

Despite the bustle, nothing is in disarray. The plant is spotless. Pride-of-place among the employees is as evident as Bob’s face, which is the company logo and adorns virtually everything in the plant.

Before the tour, Moore took a brief moment from a lengthy conversation about his business to sign a few remaining checks for the Internal Revenue Service. Moore signed away several sizable bills with the brief stroke of a pen.

“Yesterday I paid my personal taxes,” he says while signing.

red-hats-550_1He describes the bill right down to the penny, smiles, shrugs his shoulders, and returns to the story about his early business life. While talking, Moore had to pause for another polite interruption from his Executive Secretary Nancy Garner to sign for an expense quite a bit more than the taxes he paid. He signed away a third of his multi-, multi-million dollar company, which would finish changing hands through an Employee Stock Ownership Plans to his employees the day after tax day.

That pride-of-place evident in every employee in every far reaching corner of business stems, at least in part, to the upcoming celebration, during which Bob would hand out the stock. For five years the company worked toward employee ownership. Now it’s a fact.

And Moore himself, who just lost a third of his company, couldn’t be more pleased.

“When we started this we hoped to finish in nine years,” he said enthusiastically as he signed the remaining papers. “But we did it in just five.”

The ESOP, as it’s commonly called, made national news when announced in 2010, drawing attention from diverse news outlets like CNN, Mother Earth, Inc., and even ABC News Anchor Diane Sawyer.

“It was so natural and sort of evolved in a perfect way. It’s really cool,” Moore says.

The mission

In many ways April 16th, the day Bob’s Red Mill employees officially took over one-third of the company, culminated a mission Moore had when he decided to leave his retirement and jump back into the business of milling grains.

“My entire inspiration is a sense of continuity in life, and continuity in life means eternal continuity. I just don’t buy this idea that when I die, that’s it, I’m gone.”

Screen Shot 2015-06-03 at 2.10.59 PMHis eternal perspective colors everything Moore does, not unlike the ubiquitous red on his clothing, his company uniforms, his business signs and his retail products. How he treats people, how he conducts his business, his passion for health and vitality, all have eternal significance he says, far outweighing the millions he has made so late in life.

Moore started Bob’s Red Mill with a simple goal of operating his business with the people in the business—customers, partners, employees—in mind from the outset, something he hadn’t done as much in his early business career, he says.

He set a simple goal for his employees: If someone left his company to do the same job for someone else, they wouldn’t do it because they could make more money.

Soon he had a health plan and a retirement plan. Profit shares were given to the employees on a monthly basis—when profits warranted it. Five times the first year, then seven, then eight. For the past 24 years, profit shares have been given out each month without fail. Then came the staggering news in 2010 that he would sell his company to his employees.

Garner said she is amazed how fast the benefit adds up each year for her and others who work for Bob’s Red Mill.

“It’s not a thing we have to earn. I don’t even know what it will be this year,” she says, shaking her head. “It’s extremely generous. He could just take it all.”

Moore shrugs. It’s the plan he had from the beginning to do things differently.

“I don’t think hardly any other company couldn’t do what I’m doing,” Moore said. “Any of them, unless they are going broke. But they think ‘Why should I do that? I’ll put that money in my pocket.’”

Another third

After the completion of the first third of the ESOP on April 16th, the plan continued to unfold. The ESOP wasn’t over. After some deliberation, Moore has prepared for the one thing in business that makes him really, really uncomfortable. When he puts a second-third of the company into the ESOP for the more than 400 employees to eventually own, for the first time in his life he will be a minority shareholder.

Screen Shot 2015-06-03 at 2.10.36 PM“I’ve always had at least 51 percent. Somebody’s gotta be the boss,” he says with a finger pointed for emphasis. “Now, I can insist. I’ve gotten along well that way. But at 86 (years old), I’m just going to have to let them have it.”

It’s just one of the ways Bob Moore has done things very differently in building a small rundown Portland mill into a globally recognized health food brand.

A business of giving

Another way Moore operates differently is the significant charitable donations that he and his wife Charlee have made. In 2011, Moore wrote a million-dollar check out of his personal checkbook to the Oregon Health Sciences University as an initial down payment on a $25-million-grant to establish the Bob and Charlee Moore Institute for Nutrition and Wellness.

The institute’s goal is to halt the rampant rise in chronic illness caused by unhealthy eating and inadequate nutrition, according to its website.

“I’ve given way more than that,” Moore says simply. “What am I going to do with all that money? You can’t take it with you.”

Moore’s charitable contributions and the diverse charitable work of Bob’s Red Mill and its employees grew so large, he enlisted one of his employees, Lori Sobelson, to safeguard the charitable work.

“I don’t even worry about it anymore,” Moore said.

Sobelson said the institute emphasizes nutrition for young mothers before conception, during pregnancy and then throughout infancy and childhood, work that in part was pioneered by OHSU’s Dr. David Barker. Barker’s breakthrough research discovered four generations of maternal DNA impacts a child’s health.

“The sense of responsibility people should have to others—smoking, drinking, hamburgers and fries—all these things and these foods are surely unhealthy. So the young woman says ‘I’m not affecting anyone,’ but she’s wrong.” Moore says.

A summit this May will bring together more than 70 epigenetic experts from more than a dozen different countries for a multi-day conference focused on these issues, Sobelson said.

“We take our partnerships seriously,” Sobelson said, “because they represent us. Each has a separate focus, but they are all interconnected.”

Screen Shot 2015-06-03 at 2.06.59 PMThat interconnected focus fueled donations to Oregon State University and the National College of Natural Medicine. A $1.35 million gift to NCNM established Charlee’s Kitchen, which is a teaching kitchen designed to educate about the dangers of early childhood obesity. A $5 million gift to OSU established The Moore Family Center for Whole Grain Foods, focused on nutrition and preventive health. All three institutions work together in a way that they didn’t before because of their shared link to the Moore’s foundation.

“I really hold their feet to the fire,” Sobelson said. “How will they sustain these projects when the money is gone?”

The overarching mission is nutritional education. In 2014, the foundation gave a four-year financial commitment to George Fox University for a “Nutrition Matters” emphasis that includes a free course for incoming freshmen and a host of healthy cafeteria offerings on campus.

“It is our goal to be—and to be known as—the premier university for health in the U.S., both in terms of the academic preparation of healthcare professionals and in outcomes of good health for our students,” George Fox President Robin Baker said. “This grant allows us to develop a multi-faceted approach to inform the entire campus community on the benefits of good nutrition.”

This and numerous other gifts to non-profits are designed to build a collective focus on healthy eating that will continue for decades to come.

Mission continues

When Moore started Bob’s Red Mill he envisioned doing what he loved and carrying out his mission to help others live healthier lives. This included some measure of business success mixed in with the overall mission: people.

“I have a driving desire to be successful with important things such as a people and customers,” Moore says, looking over those pictured with him on the mill’s steps back in the early days.

But don’t think for a minute the mission—his memoir is aptly named, People Before Profit—ever meant compromise in the business. He remains passionate about both, which explains why he still travels the country as an ambassador of his company, why he still occupies the corner office, why he still cares so deeply that the business is conducted in the right way, even as he slowly divests his ownership and control.

It needs to carry on, he says.

“Well, we don’t have to worry about selling this business,” Moore says. “Not while I’m alive anyway.”

On that point, he will insist, you can rest assured.

Part 2 of 2. Read part 1.

For more on Bob’s Red Mill, visit www.bobsredmill.com, like them on facebook, and follow them on instagram, Pinterest , or twitter.  

Reed LaPlant Studio grows from the root up

image2

For a man who makes his living from wood, it’s no coincidence his business vision comes from his roots. Raised in Wisconsin with a deep love of nature and a respect for American-made products, custom furniture maker and designer Reed LaPlant routinely carries those early lessons and experiences into his business.

Even the business itself, Reed LaPlant Studio, emerged like a new shoot from LaPlant’s early work as an architect – his first foray into a business that combined both design and build. But before it was ever a plan for business, LaPlant’s values of sustainability and artistic interests served a practical purpose.

“As a very poor college kid, I rarely had the money to purchase materials for any projects for the neglected, roach-infested house I rented,” he says. “I made a bookcase from scrap lumber and some old windows I found in an abandoned movie theater in town. The windows had been brought as trash by someone not wanting to go all the way to the town dump.”

He didn’t know then that someday he’d make his living making furniture that, while decidedly more upscale, uses the concepts of sustainability of his youth. LaPlant, 46, says Reed LaPlant Studio uses only U.S.-grown and made materials and minimizes consumption and waste.

“This is not a marketing effort. It’s simply what we’ve been doing since the inception of our business,” LaPlant says. “I think my rural, blue collar, Wisconsin roots have always informed my choices. We also always used what was either found, dismantled, or cultivated on our property. My cousin and I built an A-frame fort cobbled from stashed plywood scraps, firewood, and used nails.”

LaPlant was a manufacturing “locavore” before such a term existed.

“I do feel very strongly about it, and this is my small, quiet way of trying to do something about it,” he says.

Both sides of design and build

Reed LaPlant Studio in Northeast Portland makes custom furniture in a unique way. Much like an architect’s process of designing a custom house for a client, LaPlant emphasizes his consultations with the client to develop furniture that expresses their tastes and best fills their space.image5
“Having been in architecture for so long, I really like to design for the space, and with a clear picture of the client’s aesthetic sense and lifestyle.”

LaPlant has seamlessly merged both his talents and interest in design and building throughout his diverse career.

“I made my first piece of furniture when I was about 15, under the guidance of the same industrial arts instructor that told me, ‘Kid, you need to be an architect.’ So I’ve probably always strongly associated the two.”

While starting out as an architect, LaPlant built his first pieces of furniture. Now, with a growing business largely focused on manufacturing, he still takes on the occasional architectural job, he says. The two remain intertwined just as they were when he started out.

“And, as many know, architects generally make very little money,” he says. “So I made my first piece of ‘sellable’ furniture out of construction site cast-off’s I accumulated during my design/build years.”

The evolution of a craftsman

Reed LaPlant Studio first opened in Atlanta as a spin-off from LaPlant’s first company, Blue Shoe, which he co-owned with a partner. Blue Shoe combined LaPlant’s design skills with furniture making. The furniture emerged as the strongest plank of the diverse business, he says. Eventually, he set out on his own and opened the studio.

As the Great Recession smothered the country’s economy, LaPlant had already set in motion a move to Portland, Oregon with his wife and two children. It turned out to be fortuitous timing.

“We relocated to Portland right when the economy tanked, so I had to rebuild my local identity anyway,” he says. “I can’t say I necessarily felt it, because I would have experienced it anyway. When you relocate across the country like that it is to be expected. It wasn’t too bad.”
The business grew through its normal fits and starts, with commissions widely fluctuating.

“I’d have four orders one month and 22 the next,” he says.

Screen Shot 2015-05-25 at 8.43.10 PMThe ups and downs of commission-based work remains a mystery, he says, though overall the business continues to grow. Seasonal factors come into play, people don’t spend much around tax time, and dining room tables sell better in the fall. But by and large he is content to ride the ebb and flow.

His best month came just as the grip of the recession eased, bringing in “a record-crushing 52 orders” that February.

“It’s like people had been holding on to their money for so long, they just finally let go and it came on like a tidal wave,” he says.

Until recently, LaPlant operated the business himself and would hire craftsman as needed. But as the company grew, he decided to focus his energies where he is best suited: making furniture. He hired an operations manager and a marketing manager so he can be making products “about 90 percent of the time”.

A piece can be made in as few as 15 hours,  but most require between 25 and 45 hours.

“I have spent as many as 200 or more hours on a single piece, but that’s pretty rare,” he says.

Like all artists, he has his favorites, a Pullman credenza and a Boochever bench.

“Each of these designs arrived in one of those rare moments when calm collides with notion, and pencil and paper happen to be in hand”.

Customer process

LaPlant noted his first step with a customer is to “invite myself over,” just as he has long done with architectural clients to get to know their tastes, the spaces they want to fill, and how his work can be compliment their lifestyle and style.

“I try to glean a sense of the potential client’s likes and dislikes, and of their personality,” he says.

With business increasingly coming via the website from non-local customers, LaPlant continues this personal touch through electronic connections.

“That’s a bit of a bummer for me, but the rest of the process is the same.”image10

Because of his growing portfolio, customers will often pick a piece directly from the website, which will still be made by hand and personalized as needed. The process typically takes between eight and 12 weeks. He is surprised that many customers prefer to choose a piece that’s already been made rather than have something personally designed, but believes it affirms the quality of the work.

“Although I love designing new pieces,” he says, “I have come to a point where I appreciate and find great pleasure in work of diminished brain strain and stress levels — work that comes with making pieces with which I am deeply familiar.”

And the greatest satisfaction? When the furniture fills the home of a satisfied customer.

“A client in New York sent an e-mail in which she quoted her husband’s immediate response to their new table,” he says. “He took the lord’s name in vain and dropped the f-bomb in the midst of dubbing the table ‘art.’ My joy and laughter hovered for a long time with that one. I still laugh and smile when I think about it.”

The rise of craft and maker movement

LaPlant is well aware that his long, hard business evolution has brought him into the middle of a dramatic business change. With the rise of the DIY (do-it-yourself) projects and increased demand for artisan craftsmanship, both competition and attention have grown dramatically in just the past couple of years.Screen Shot 2015-05-21 at 2.12.56 PM

The Maker Movement, as it is called, has attracted any number of new budding entrepreneurial craftsmen.

“With so many people able to freely share ideas and spread inspiration across the web, makers are forming communities of their own, and more people around the world are becoming influenced to be makers,” wrote Brit Moran, founder of Brit+Co.

“I firmly believe there is this incredible creative energy that comes with this ‘maker movement,’ he says, “and there are a lot of makers interested in collaboration. And it’s great.”

The online craft selling company Etsy now has more than one million artisan sellers that generate nearly a billion dollars in annual revenue. The potential market for the maker movement and the expansive level of competition are evident.

For LaPlant, it’s emblematic of the pros and cons of any business.

“People are much more broadly aware, if not of the direct economic impact, of the presence and viability of purchasing or commissioning locally. And that’s great,” he says, “However, from the perspective of a father of two and an owner of a business in a notoriously difficult field, the new-coming competition is a little unnerving…that’s the struggle of every business.”

In the end, LaPlant knows he will stay true to his roots, his unique blend of both design and build, and a lifelong commitment to sustainability and to continued artistic work that affords him both a business and an expression of his talent. If LaPlant is anything, it’s rooted.

“I am a devout believer in the notion that everyone deserves, in every way, a crack at earning a living doing what they love,” he says. “I do it, and I wish this experience upon everyone who wants it.”

 For more information, visit Reed LaPlant Studio, follow then on twitter and instagram, or like them on facebookScreen Shot 2015-05-25 at 8.44.10 PM

A “really cool” mission drives Bob’s Red Mill

Screen Shot 2015-05-21 at 8.15.00 PM

After a full career in the auto business and launching an unlikely milling business in Redding, California, Bob Moore hit upon his true calling in Oregon — and in so doing made hundreds of millions of dollars after his 60th birthday — by selling flour and grains.

“I’m a good salesman,” says the man whose picture adorns Bob’s Red Mill products shipped to virtually every continent on earth.

But he doesn’t pull his punches when talking about the Bob’s Red Mill product he wishes you didn’t buy.

“Do you sell white flour?” he is asked over lunch among his customers at the Bob’s Red Mill Whole Grain Store and Restaurant.

“I do. I can’t get around it,” Moore says with a sigh. “We’ve made a high quality, higher protein white flour. It’s better. It’s unbleached and organic. But I still don’t think people should eat it. They should eat whole grains.”

The namesake of Bob’s Red Mill started this business venture with a simple passion to eat better and live longer — while helping others do likewise. He had no expectations that his small mill with a handful of employees would become a global company with more than a hundred million dollars in annual revenue against zero debt.

When you start a business nearing retirement age you really don’t think quite so grandiose, he says. He pauses at the memory to consider all the turns his life took.

“It’s pretty cool. I’m very lucky.”

Catch phrase

You can’t spend ten minutes with Moore and not hear words like “amazing” and “cool.” He brims with optimism and enthusiasm for everything around him. If Bob Moore, 86, has a catch phrase it’s oddly the colloquialism of a teenage Valley Girl.

“It’s really cool,” he says about everything from his new 1.2 million-dollar manufacturing machine to playing side-by-side pianos in the Red Mill store every Friday with his Sidekick, Institutional Memory, Keeper of the Schedule, and Executive Secretary Nancy Garner.

P1030056He says it so much that those around him say it too.

“It’s really cool,” Garner said about the plant’s technology during a tour earlier in the day.

Moore’s corner office is equal parts working office and museum. Piles of papers, proposals and the common detritus of a busy CEO co-mingle with knickknacks and memorabilia from his diverse life and interests in an eclectic mix of paperwork, memories, and passions that aides in the telling of his story. As Moore recalls the sixty-year business career that brought him to this point of wealth and acclaim, he routinely relies on visual points of reference on the walls, the shelves, the tables and his desk to aid in the telling.

He points to an old library book with the plastic cover and “property of” sticker still affixed. The book, John Goffe’s Mill by George Woodbury, remains a treasured artifact.

“That was the key to this whole thing right now. Honestly,” he says.

But his orderly mind doesn’t want to get ahead of itself. Bob circles back in his memory, further back before the mills, when cars were his thing. He struggled as a gas station owner early in his life, then worked as a manager for auto centers in the Sacramento area. He started reading other books, he says. He walks over to another part of the office where he has a small library of 1950s and 1960s health food books, including Let’s Get Well by Adale Davis.

“These people seemed to grasp the impact of devaluing food,” Moore said. Davis’ book, he says, motivated him to change his life entirely.

It was the 1960s, a full half-century before terms like “foodie” or “localvore” became commonplace. All of Sacramento had two health food stores, Moore recalls. But Moore’s wife Charlee “started cooking with that stuff, the whole grains, and gee, it was good.”

Moore quit smoking and became a closet health-food nut, a passion that grew as he moved his family to the then rural community of Redding, California. Health food options were “pretty slim pickins’” he said.

The first mill

JC Penney in Redding recruited Moore to run its auto center. Moore interviewed while Charlee scoured the area with the couple’s children. They met back up with mutual good news.

“I said, ‘I got the job.’ She said, ‘I got a house.’ It was just like God was speaking to us. It was pretty amazing,” Moore recalled.

While working for JC Penney, Moore read John Goffe’s Mill and was hooked.

“It was really cool,” he said, of the story of an archeologist who took over the family mill.

“He didn’t know a thing about it,” Moore says. “He didn’t know anything about selling, but I was good at selling, and then he didn’t know a thing about milling either. How much success he had, I don’t know. But he had a lot of fun.”

Moore decided to send letters all over the country in search of a mill. He sent 16 letters to various mill owners.

“I got a letter back from just one of them” he says, his hand slapping the table with excitement. “He just inspired me. He and his brother had a mill in Muncie, Indiana… his name was…”

His calls into the adjourning office for Garner asking the name of his “inspiration.” A man who has inspired hundreds around his plant has no shortage of inspirations himself.

“Dewey Sheets,” Garner says. Moore enthusiastically agrees.

Inspired by Sheets, Moore bought milling equipment from around the country, at a time when mills were not only out of fashion, but closing down.

Moore points to another photo, a picture of 2,000 square foot Quonset hut. Inviting two sons to join him in the business as equal partners, they launched Moore’s first mill.500_102293015513_6902_n

“We all worked other jobs,” he said. “I worked two more years at Penny’s. It’s crazy how it worked out. It was really cool.”

An old advertisement from the early days hangs on a cluttered wall, offering 3-lbs of 7-grain cereal for $1.49 and other “high-fiber foods” like Colorado Popcorn and Brown Rice.

That business continues under the ownership of Moore’s children to this day, in part as a vendor for Bob’s Red Mill.

“I’m very pleased with the boys,” he says.

A calling

In 1976 he and Charlee decided to retire and go to seminary together. They moved to Portland to study Greek and Hebrew at what was then the Western Evangelical Seminary.

One day while walking home he saw an abandoned mill, re-igniting his passion for milling.

“I just love this business,” he says, pointing to a photo of the first Red Mill before it was painted red.

Soon he bought it. Soon after that some of his fellow seminary students were helping him run it.

It felt more like a calling than a job. For the man who retired to study Biblical languages, his calling was forged from the pressure of millstones grinding grains into healthy foods. He had to choose between studying scriptures or selling flour. He left school and returned to business full time. Bob’s Red Mill began.

“Everything was an inspiration,” he said. “It was so different. But ever since we started this thing we were successful.”

500_102293035513_7706_nThe business went well with its wood floored retail store and Moore still milling grain. An early photo of the first employees hangs on another part of his cluttered office. Two of those pictured still occupy offices in the plant, having grown along with the company.

That commitment to people met a stern test a few years later in 1988 when Moore’s thriving mill burnt to the ground after an arsonist set it ablaze. He could have cashed the insurance check and walked away, and even return to his Biblical studies if he desired.

He thought about it, he admits, but only briefly. The mission for both his customers and his employees and his passion for healthy food ended all thought of retirement. Bob’s Red Mill moved to a larger location just a few miles away—though the business was leveled, Moore was able to salvage the three stone mills from the fire—and the business exploded on the national, and now global, marketplace.

The first page

Moore said when he started Bob’s Red Mill he wanted to do one thing he hadn’t done in past businesses. He wanted to apply Biblical standards like The Golden Rule, The Apostle Paul’s teaching on money, or most importantly, the “first page of the Bible” that talks about the Earth’s abundance of seed and herb, all of which God deemed “good.”

“I began to take it seriously,” he says.

He describes how the industrialized food economy changed the basic nature of seed, and altered the grain by removing the bran, for example. He remains inspired by returning people to the food that God called “good” on the first page of the Bible.

“Of all the things I could do, that is something,” he said. “Being on the first page of the Bible is cool. That’s the business I am in… I’m cooking on some different kind of burners here. I’m producing whole grain food for a different kind of reason than I did when I was in Redding. It was more than a way to make a living.”

It was, and remains, a mission.10550047_10154376414815514_3129476389115831218_o

Grinding it out

Perhaps the earnest nature of Moore’s mission inspires his hands-on approach to the business. This is no figurehead. He shoves his hands into the bags of flour as they are filled, inspecting quality. He asks questions of employees with the intensity of a prosecutor, but greets them with equal enthusiasm.

Whatever can be done under Moore’s supervision, the better, it seems, from the in-house test kitchen where Moore samples gluten-free cookies, to the print shop that churns out labels in diverse languages like Farsi and Hindi, to the gluten-free testing lab where lab technician Ron Crippen tests every gluten-free product that comes into Bob’s Red Mill.

Moore stresses the company used to send samples to a lab for testing. It wasn’t fast enough or as reliable as he wanted, so he set up the lab, along with a sealed off processing plant separate from all the other products.DSC02991 (1)

Moore said they only take products from those who only do gluten-free.

“It’s not going to work if they do a glutenous product. It’s just impossible” he said.

Crippin tests roughly 200 samples a day.

“It doesn’t take much—one little dust grain—to make it spike,” he said.

If it needs to be done on a regular basis, Moore wants it done in his plant under his watchful eye. Even at 86 that hasn’t changed. His casual demeanor is nudged out of the way temporarily when questioning an employee about a sink for the kitchen that hasn’t yet been installed. No detail is too small for Moore’s intense interest and inspection.

This attention to detail explains why Meghan Keely now works at Bob’s Red Mill as the designated Safe Quality Food Practitioner, who ensures all standards across the globe are met and exceeded.

P1030066“It’s us saying no, we’re not going to maintain the status quo,” Moore said of recently creating the position Keely now holds, “but we’re going to go above and beyond.”

An entire room is designated for company uniforms which have the company logo of Bob on the left chest and the employees name on the right.

“I came from gas stations. I like uniforms,” Moore said. “I wanted the place to look nice.”

These details, the excellence, the focus is what has made the business thrive and profit, but the mission to promote healthy living—that old first page of the Bible that God called good–is never far from Moore’s mind.

“Bob has a passion about healthy foods for the whole world. That has led to prioritizing the education and outreach,” says Lori Sobelson, director of corporate outreach.

“We want to change the world,” Moore says simply, still very much a businessman and a missionary for healthy living.

“It’s pretty cool,” he says again.

Indeed.

To be continued…

For more on Bob’s Red Mill, visit www.bobsredmill.com, like them on facebook, and follow them on instagram, Pinterest , or twitter.  

Angling into a compelling business

10628398_829866317046445_8957579323360023058_n

Start-up lesson number one, if experience is our guide, is to invest in a product unique to Oregon that is about to be the topic of a major motion picture. It worked fabulously for Oregon Pinot Noir following Sideways. But before that, it worked even better for those in the business of angling for fish with a rod, reel and fly.

The Pacific Northwest’s boutique fly fishing industry found its unexpected spokesman when Brad Pitt chased big fish against the incredible backdrop of Montana in A River Runs Through It. Talk about a visual marketing campaign.

“That movie kicked the fly fishing business in the tail,” Jon Bauer, founder of Bauer Fly Reels in Ashland, Ore. recalled recently. “That propelled the fly fishing industry for ten years. All these people saw the movie and fell in love with it and had to go do it.”

Bauer was one of those caught up in the momentum, which also grew because of a dramatic sweep of history. In addition to Pitt, another big name of that era – Ronald Reagan – had a little bit to do with it. The Cold War Era fell with the fall of the Soviet Union and the destruction of the Berlin Wall. Defense spending dropped. Back in places like California, machine shops bore the brunt. Many had to reinvent themselves just like a Bauer, a race car driver with a machinist background.

“Everybody and their brother who had a machine shop was trying to make a fly reel in the 1990s,” Bauer said.

Bauer beat them all to the punch and he did it by literally reinventing the wheel.

Re-inventing the wheel

Bauer, now 65, was in his early forties with a new family when he needed a new career. Being a race car driver doesn’t prepare you for much outside of racing. He said he considered a startup business within the field of racing that he knew well.

11043050_929517320414677_4805936100096403220_n“That was, for me, deep water,” he says. “You had to have a lot of money and I didn’t.”

What being a race car driver did prepare him for—combined with his machinist background from his youth—was to make things.

“In racing we were designing widgets all the time. That’s how you stay ahead and win,” he says.

So the next career move, he figured, would involve some type of new widget that he could put his name on and sell. Riding the aforementioned wave of interest in fly fishing and being an angler himself, he thought a lot about the reel.

“It’s a pretty simple device and they’ve been made in a certain manner for many, many, many years,” he says.

That lack of innovation created an opening. Also, coming from a different industry all together, he thought differently than those trying to improve the reel. He thought about truck winches and race car wheels and how both generate power and speed. He applied some basic physics, a larger wheel (called an arbor) and new clutch technology, all of which came together in a patented design that makes Bauer Reels one of the best reels on the globe still to this day.

“Large-arbor fly reels are the hottest thing in fly fishing since the introduction of graphite rods in the 1970s,” wrote Field and Stream magazine.

“It’s illogical to have it any other way,” Bauer says. “It was not only large arbor, but a one-way clutch that I designed. Eliminating the number of parts, better costs, less things can go wrong. It was a game- changer. It was totally different and that’s what made such a big splash. As a result, any reel company of any consequence today all make large arbor reels. We really changed the industry.”

Oregon made craftsmanship

So start-up lesson number two might just be this: if you expect to profit from a major motion picture and the glamorous star power of a Brad Pitt, your product better be good – industry-leading to be precise. Here, like Oregon Pinot Noir, fly fishing in environmentally protected free-flowing rivers and streams elevate the quality of the experience throughout the Pacific Northwest.

Bauer’s reel remains an industry leader.

10710554_844675922232151_5783647888767386693_nStill made by hand (often Bauer’s hand) in an Ashland shop, Bauer reels are an industry leader in a sport that dates back to second century Rome and the art of Tenkura in Japan. Fly fishing is above all, to those who enthusiastically defend and participate in the sport, an art form. Bauer is a foremost artisan, his supporters enthusiastically say.

“Passionate fly angler, precision fly reel designer and a champion race car driver, I personally don’t think Jon has it in him to do anything in life less than perfect,” blogged Greg Darling, internet sales manager for Gorge Fly Shop. “The first thing I took interest in was Jon’s workbench… clean, neat and all in order.”

From that workbench comes reels others rave about.

“The new RX5 performed flawlessly and this reel just might be Jon Bauer’s masterpiece,” wrote Dylan Rose of Fly Water Travel.

Dave McCoy, owner and guide of Emerald Water Anglers, says Bauer’s reels have served him well fishing in every part of the globe, from Alaska to New Zealand and virtually every continent in between.
“It is very smooth, and has wonderful sensitivity to the drag so it can be set perfectly,” McCoy says.

Business challenges

As it turned out, inventing a new reel system for centuries old technology was the easy part.

“We didn’t quite pull off that plan to retire up here,” Bauer says of his move to Ashland in 2005. “We did hit the peak when we moved out of California, which helped a bit I guess.”

The fly fishing industry had cooled. Again the sweep of history played a hand, this time not for the better. First came Sept. 11, 2001, which dramatically impacted travel. The next few years were bumpy, full of peaks and valleys not uncommon to a small business, even one with a globally recognized brand and industry leading patent.

Then, off-shore manufacturing provided stiff competition as quality increased.

“The whole model has changed because of the influence of what’s being made in China and Korea,” he says. “It hasn’t gotten any easier, but I think there is a little swing of manufacturing coming back into the states. But that takes a long time.”

The tough business climate was only going to get worse.

“2008 really put a stop to everything,” Bauer says. “Fly fishing is a small, tiny, miniscule industry. The recession hit the distribution hard. The larger companies with a broader product line gobbled up the retail side of it which takes us out of the equation.”

Bauer only makes reels. Not fishing poles, not waders, not even an inexpensive bulk manufactured knock-off reel made in China. Distribution networks are critical and most are on life support.

“A lot of fly shops couldn’t make it,” Bauer says. “We use independent sales reps, and of course a lot of them couldn’t make it either. It’s been difficult.”

10849946_872572852775791_3502392861608260093_nBut confidence in both Bauer quality and Bauer himself remains high as those within the industry appreciate Bauer’s contributions.

“Jon is a charismatic, knowledgeable and passionate purveyor of his product,” McCoy says. “In this sport, we need as much of this as possible to inspire and lead the next generation to carry that torch forward and Jon is doing an exemplary job of it.”

The obvious question begs to be asked, so I do. Will the brand be bought out?

“That’s a big topic right now. Because of the ups and downs of the economy we’ve been approached several times, but it’s never been completely done. We’ve built a good brand but there are fewer companies that can afford to buy up these brands.”

Personally, he says, he’d like see an independent like himself—another machinist looking to keep the machines running—buy him out. But he’s listening to offers. He’s considering the exit strategies and thinking seriously about the future of the sport he loves. He still has a place on the Williamson River in Southern Oregon, the place he bought to retire and fly fish that still beckons.

“I gotta figure out that puzzle,” he says, which is not altogether unlike the puzzle of the reel itself that he solved and launched himself into the history books of a historic sport.

For more information, visit Bauer Fly Reels or like Bauer on Facebook.