Exit strategy was not objective at Northwoods

(Read the orignal Milwaukee Business Journal article here.)

Posted: January 26, 2001

By: Phill Trewyn

You could say that Northwoods Software Development is the prototypical Wisconsin technology company.

Conservative values guide Northwoods with its finances, its work force and its business development. Forget the flash and dash of some California dot-com companies.

"We don't necessarily see ourselves as making a big splash and then having an `exit strategy,'" says Bob Weisenberg, president of Northwoods. "We see ourselves as being a long-term business more like a traditional Milwaukee job shop than like a modern dot-com company. That's the way we think."

That's not to say the traditional values have impeded the growth of Northwoods.

Established in 1997, the Brown Deer-based company has experienced 140 percent growth over the past year. Revenue grew from $1.7 million in 1999 to more than $4 million in 2000.

"We haven't used our traditional values to restrict our growth, but we've done it in a way that hasn't required any kind of big risky financing," Weisenberg says.

That's an advantage that Weisenberg and Patrick Bieser, a 50 percent owner and chief executive officer of Northwoods, have had from the start.

Northwoods is one of 26 Milwaukee-area firms named "Technical Knockouts" in September by eInnovate.org, a professional organization for high-tech entrepreneurs and businesses.

Both Weisenberg and Bieser were successful in business prior to beginning Northwoods.

For 20 years, Weisenberg had been part-owner of Effective Management Systems (EMS) in Milwaukee, one of the first manufacturers of software for mini-computers.

In 1999, EMS was acquired by IFS, a large Swedish enterprise resource planning company that maintains a Milwaukee presence and sells Internet-based manufacturing systems.

Bieser founded Milwaukee-based River Run Computers, a hardware networking company, before deciding to focus solely on software development. After five years of leading River Run, he sold the company to his sales managers, took 10 programmers on his staff and the existing customer base to start Northwoods Software in 1997.

Weisenberg met Bieser shortly after that transition, and the two agreed to become partners.

"Patrick and I are perfect complements to each other in terms of building a business," Weisenberg says. "He's a very technical-oriented person who's also a good entrepreneur. I'm a good business-oriented person who happens to like technology."

Northwoods has a work force of 45, most whom work as software engineers, something that Weisenberg sees as a distinguishing factor.

"This is a company that really caters to the whole software engineering mentality," Weisenberg says. "This is a company that loves programming, that loves software and where the software is the product, not just the support for something else. The software engineering and the software itself are the crux of the matter here and people find that out right away."

One idea that Weisenberg would like to see become the crux of the perspective surrounding Wisconsin's technology business sector is that it's not as backward or far behind as some may think.

He recently wrote a white paper titled, "Why Wisconsin will thrive in the new information economy," which he presented at the Wisconsin Economic Summit held in Milwaukee last November.

The presentation detailed how the state's e-business and information technology economy is more sophisticated and healthier than commonly believed.

Weisenberg noted the histories of M&I Data, now Metavante; Deluxe Check, formerly part of A.O. Smith Corp. and now known as eFunds; and Fiserv Inc. Each of those firms are world leaders in information technology services for the banking industry.

"None of those three would have been included in any kind of (technology) statistics because they were considered part of the banking industry, not part of IT," Weisenberg says.

He also points to Dodgeville-based Lands' End Inc., a leader in online catalog sales, and Brown Deer-based Catalyst International Inc., a leader in advanced technology for warehouse management.

"Wisconsin's actually played a leadership role in a lot of areas of IT," Weisenberg says. "What Wisconsin doesn't have, and why it's measured poorly, is that it doesn't have a lot of Internet (initial price offerings) and doesn't have a lot of venture capital.

"So if you say, `Well, we're going to judge the state by how many Internet public companies there are and how much venture capital is flowing through it, it scores pretty poorly," he says. "I do agree (venture capital) is important and we have to increase it, but that's only a small portion of how you should judge."

Weisenberg helped form the Wisconsin Information Technology Leadership Association (WITLA), a trade association for the state's IT and e-business industry, as a way to promote existing and potential technology businesses in Wisconsin.

© 2001 American City Business Journals Inc.

Click here to read the original Business Journal Article