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UMBC's Dan Roche on climbing Mt. Kilimanjaro: "An entrepreneur gets satisfaction from achieving a goal, and I certainly got a tremendous amount of satisfaction from achieving that goal. It's not any different." |
Dan Roche started three companies before age 40. Now, as UMBC's Venable Entrepreneur-in-Residence, he is helping other businesspeople get on their feet. He recently discussed his position at the school and his experiences in the technology field.
Describe your role at UMBC as the entrepreneur in residence.
Venable provided a grant to the UMBC tech center [incubator] to find somebody to come in and help some of the companies get to the next stage of wherever they are in their life cycle. Every company is a bit different. Some are seeking funding, some are working on business plans, and some are just trying to get their intellectual property in place and finish the R & D work that they are doing. Some are figuring out how to market themselves.
I spend a day or two a week over here meeting with companies and looking at where they are, helping them meet potential capital providers and other types of people that would help them. That's probably 75-to-80 percent of what I do here.
And the other 15 or so percent is you teach a class to undergraduates?
I do. I teach a class called Introduction to Entrepreneurship. I also just in general help out with the tech center positioning itself, trying to determine what services it should offer to start-ups.
And you are still working in technology as well?
Yes, as a matter of fact, I just kicked off a company last week, which is going to focus on doing network security product and services.
So, this is not a case of "Those that can't do, teach." You are not hiding out at UMBC during this horrendous market.
Oh, no. Let me give you my story. I started a company in 1991 called Rapid System Solutions. I sold it in 1996, worked my employment agreement out and left them in the end of '97. I then did a "roll-up," bought 13 companies and IPOed them in February of '98. I ran that for a couple of years and then just decided to take some time off. So, I've just been managing my investments for a year, year and a half.
A roll-up is when a company buys a lot of smaller companies to try to quickly collect all the different pieces of one market.
Yeah, exactly. There are certain opportunities in a market that a small company just can't acquire just because of its size. You need to have enough muscle and enough mass to be able to bid on some of the higher-end projects.
That roll-up was Condor Technology Solutions, and they've had some problems. The IPO was a big success. At its height the stock was about $18 a share. But by the time you left the company it was down in the single digits and now it's a penny stock.
Condor was a roll-up and roll-ups were kind of out of favor shortly after Condor got out there. But Condor was making money. It was undervalued if you just purely looked at its cash flow. The mistake that was made at Condor, in my opinion, was that there were some big influences to continue and acquire companies rather than just try to integrate and operate the companies we had.
The company ran up about $45 million in debt and then had a couple of bad quarters and had trouble servicing that debt. It went downhill from there quickly.
I was committed to that company, and I'd have done anything for that company. I have great relationships with the people that are still there. I would have done things a lot differently if I had stayed.
In your years as an entrepreneur -- you've founded or worked with several start-ups -- have you ever used an incubator?
No, I have not.
Yet you work with one now. Are there pros and cons to incubators that caused you to make those decisions not to use one?
Describe your role at UMBC as the entrepreneur in residence.
Venable provided a grant to the UMBC tech center [incubator] to find somebody to come in and help some of the companies get to the next stage of wherever they are in their life cycle. Every company is a bit different. Some are seeking funding, some are working on business plans, and some are just trying to get their intellectual property in place and finish the R & D work that they are doing. Some are figuring out how to market themselves.
I spend a day or two a week over here meeting with companies and looking at where they are, helping them meet potential capital providers and other types of people that would help them. That's probably 75-to-80 percent of what I do here.
And the other 15 or so percent is you teach a class to undergraduates?
I do. I teach a class called Introduction to Entrepreneurship. I also just in general help out with the tech center positioning itself, trying to determine what services it should offer to start-ups.
And you are still working in technology as well?
Yes, as a matter of fact, I just kicked off a company last week, which is going to focus on doing network security product and services.
So, this is not a case of "Those that can't do, teach." You are not hiding out at UMBC during this horrendous market.
Oh, no. Let me give you my story. I started a company in 1991 called Rapid System Solutions. I sold it in 1996, worked my employment agreement out and left them in the end of '97. I then did a "roll-up," bought 13 companies and IPOed them in February of '98. I ran that for a couple of years and then just decided to take some time off. So, I've just been managing my investments for a year, year and a half.
A roll-up is when a company buys a lot of smaller companies to try to quickly collect all the different pieces of one market.
Yeah, exactly. There are certain opportunities in a market that a small company just can't acquire just because of its size. You need to have enough muscle and enough mass to be able to bid on some of the higher-end projects.
That roll-up was Condor Technology Solutions, and they've had some problems. The IPO was a big success. At its height the stock was about $18 a share. But by the time you left the company it was down in the single digits and now it's a penny stock.
Condor was a roll-up and roll-ups were kind of out of favor shortly after Condor got out there. But Condor was making money. It was undervalued if you just purely looked at its cash flow. The mistake that was made at Condor, in my opinion, was that there were some big influences to continue and acquire companies rather than just try to integrate and operate the companies we had.
The company ran up about $45 million in debt and then had a couple of bad quarters and had trouble servicing that debt. It went downhill from there quickly.
I was committed to that company, and I'd have done anything for that company. I have great relationships with the people that are still there. I would have done things a lot differently if I had stayed.
In your years as an entrepreneur -- you've founded or worked with several start-ups -- have you ever used an incubator?
No, I have not.
Yet you work with one now. Are there pros and cons to incubators that caused you to make those decisions not to use one?
