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Rising Stars

Author: Karen Hart
February, 2012 Issue

NorthBay biz profiles three young companies poised for greatness.

“Here’s to the crazy ones, the misfits, the rebels, the troublemakers, the round pegs in the square holes…the ones who see things differently—they’re not fond of rules….” So began the 1997 “Think Different” ad campaign for Apple Computers. It continued, “You can quote them, disagree with them, glorify or vilify them. About the only thing you can’t do is ignore them, because they change things. They push the human race forward, and while some may see them as the crazy ones, we see genius. Because the ones who are crazy enough to think they can change the world are the ones who do.”

The characteristics of entrepreneurs have been researched for years. The six traits that typically come up are commitment/determination; leadership; opportunity obsession; tolerance of risk, ambiguity and uncertainty; creativity; and motivation to excel.

“Being an entrepreneur is knowing you have this vision, but there’s uncertainty because there’s no set path and there’s no formula you can apply [to make it a reality],” says Michael Newell, executive director of the North Bay iHub at the Sonoma Mountain Business Cluster. “The entrepreneur has to find the right path and team. For most entrepreneurs, it’s a journey. They have a passion to do something and to go their own way.”

Over the years, there’s been a lot of media attention devoted to successful entrepreneurs, turning innovators such as Steve Jobs and Bill Gates into household names. “They become deified in the business world,” says Brian Ostrovsky, entrepreneur-in-residence at Sonoma State University (SSU) and founder/CEO of Locable, a nationwide network of community websites meant to become the “Main Street of the 21st century.” “The majority of companies fail, but you never hear of them,” he continues. “We hear about the ones that succeed to the tunes of hundreds of millions of dollars.”

“It’s the rare person who achieves massive wealth on his or her first attempt in an entrepreneurial venture,” adds William Silver, Ph.D., dean of the school of business and economics at SSU. “The typical story for most entrepreneurs is that you do it again and again.”

Following are three stories of rising young entrepreneurs in the North Bay.

A gambler at heart

Andreas Peneder and Ben Braverman, cofounders of FortKnock, met by chance three years ago. At the time, Peneder was interested in developing a computer security software system that would be a level beyond what the Central Intelligence Agency offers but easy enough for a 6-year-old to use.

Braverman, who’s originally from Ohio, had just moved to California after leaving Vassar College and spending some time volunteering in India. He rented a house near where Peneder was renting office space above a garage in Sebastopol. They ran into one another on occasion while Braverman was walking his dogs. One day, Braverman and Peneder both happened to be at Mom’s Apple Pie.

Peneder was working on his first patent application for FortKnock. Braverman struck up a conversation, which led to him taking a look at the application and, soon enough, writing the text. Braverman and Peneder spent hours together working on the application. By the end of the day, Peneder hired Braverman on as a consultant, but in a few weeks time, he asked Braverman to work with him full time.

“This wasn’t the sort of thing a rational person would do, but I was taken with the idea and I could see that Andreas was a visionary,” says Braverman, who’s now 24 years old. “His idea solved a problem that every single person will encounter. It was worth betting on because the multiplier is so huge. In essence, if we’re right, billions of people will use our technology.”

The idea behind the product was to make it impenetrable to hackers and to eliminate the need for passwords altogether by asking an individual a series of questions only that person could answer. “Passwords are a pain and fundamentally insecure,” explains Braverman. “It’s a problem that costs companies money and annoys every user.”

The first year was spent developing the product at Johannes Keppler University in Linz, Austria, to make sure it was mathematically secure. “We took the idea and proved it could be done,” says Braverman. “We found that no matter what hackers do, they can’t learn anything that would help them in a future attempt.”

Though they were willing to take a chance on a company that was just getting started, Braverman says they had challenges along the way. “We got a peek into the wild world of raising capital. We thought we were going to be able to raise venture capital before we were.”

There were also stumbles in the area of developing a product for an industry that was unfamiliar to them. “Basically, we were trying to figure out what we were doing. We had zero connections and knew no one in the tech world—and this is a business that runs on referral.”

Braverman and Peneder met with advisers from some larger technology and financial service companies. In November, Braverman, who’d been operating as chief executive officer, stepped aside and handed the reigns to Rob Mansell, who was the vice president of payments at Paypal (Braverman still operates as cofounder and chief evangelist).

FortKnock’s software product, 2-FAST, was launched in November 2011. It lets users employ six questions from a possible pool of 200. The questions are never factual, since things like your mother’s maiden name are easy to research. Instead, the questions are unique to the user and evoke strong opinions, reactions or preferences. “With our authentication system, you can unlock your whole digital lifeæso there’s no more passwords, no traditional identification theft,” says Braverman. Ultimately, FortKnock is hoping its identification system will be the answer to making payments without the need for a credit card.

Currently, FortKnock, headquartered at Sonoma Mountain Business Cluster in Rohnert Park, is already in negotiations with two major financial service companies to upgrade to 2-FAST and replace all user passwords.

What’s Braverman’s advice for entrepreneurial types? “We’re all gamblers,” he says. “Make sure you have an idea to bleed for and be committed. I think you have to be a bit deranged, because we had 100 people tell us we were crazy. It’s literally being told you’re crazy over and over.”

A passion for the environment

Stig Westling, founder and chief executive officer of Skip to Renew, has always had a passion for the environment and green chemistry. He has a degree in biochemistry from California State University Fullerton and a green MBA in sustainable enterprise from Dominican University of California in San Rafael.

The seed of inspiration for producing sustainable, environmentally friendly lubricants took hold while working at Sirona Fuels, an East Bay biodiesel plant. “At the plant, we make 50,000 to 60,000 gallons of biodiesel each month. Initially, we had to buy a lot of petroleum-based lubricants [to keep the machines running], which is bad for the environment. I thought there had to be a better way,” says the 29-year-old Westling. More than 50 percent of all lubricants are disposed into the environment, releasing cancer-causing and endocrine-disrupting toxins, according to Westling

“There were no industrial, bio-based lubricants for me to buy,” says Westling, who resolved the problem by creating one made from jatropha, flax, linseed and grape seed oils.

Once the idea of creating a biodegradable, nontoxic lubricant took hold, Westling visited the labs at Dominican University and pitched his concept. A professor at the university, Ken Frost, Ph.D., played a key role in helping Westling get his project off the ground.

In March, Westling launched Skip to Renew, located in San Rafael, which develops and produces sustainable, cost-effective and environmentally friendly lubricants and greases. The Skip to Renew lubricant is bio-based and is good for a variety of industrial uses, such as cutting oils, hydraulic fluids and lubricating gears and chains.

Skip to Renew also created two new products for bicycle enthusiasts. The brand, The Recyclist, includes a bike chain lubricant for everyday use as well as a special formula for racing events. Two additional products—a grease and degreaser, which are also designed specifically for cyclists—have just been launched.

As his business began to quickly expand, Westling acquired three additional partners—Janine Elliott, Elliot Jaramillo and Jonathan Mooney. Skip to Renew products are currently available in 125 stores in California and New York, and he’s also closed a deal with Wilsons Distributor, making the products available in California, Nevada and Arizona. What’s more, another deal was recently closed with J&B Distributors, making the products available nationwide.

The products took first place in the Best of Show competition for North Bay Investors Summit in Rohnert Park at the Sonoma Mountain Business Cluster in November. And they placed second in the Sustainable Brands Competition in Monterey Bay.

What’s on the horizon for Westling? “I still run the refinery and do Skip to Renew full time,” he says. “I have no pets and no kids, so I have the ability to do that.” He’s also currently teaching an environmental chemistry class at Dominican. As for Skip to Renew, the company plans to launch more product lines for industrial use in the near future.

What advice does he have for entrepreneurs? “Don’t take criticism personally. An enormous amount of people told me, ‘It’s not going to work because….’ Also, work harder on yourself than anything else. The more you read and study, the more you can create for your team, your family and your business.”

Let the good times roll

Mitch Boyd and Joseph Kent Jarman, co-founders of Joseph Kent Wines in Napa, met by chance through mutual acquaintances at the New Orleans Jazz and Heritage Festival 10 years ago.

Their initial conversation, though, was about beer, not wine. “Kent was wearing a t-shirt advertising my favorite brewery from college, and that’s how we struck up a conversation,” says Boyd. Nevertheless, the conversation soon turned to wine. At the time, Jarman was a student at UC Davis working toward a degree in viticulture and enology. Boyd had just started his career in sales and marketing at Kenwood Vineyards in Sonoma.

The two young men discovered they had a lot in common. They’d both attended the University of Oregon. Both of their dads are attorneys named Bill. There were other quirky similarities, which they discovered over the course of that week in New Orleans. Boyd and Jarman returned to California and got together the following weekend. Over the next six years, they continued their discussions about wine. “We had lots of ideas back then,” says Boyd. But they each focused on learning more about what they seemed to have a natural aptitude for—viticulture for Jarman, and sales and marketing in the wine industry for Boyd.

Boyd continued his career in wine, moving up to become the international sales and marketing manager for Heck Estates. Meanwhile, Jarman took a position with Duckhorn Wine Company in Napa Valley and spent the next five years learning about the many different vineyards and varietals grown around the valley.

In 2008, Boyd and Jarman decided it was time to turn their dream into reality. The two young men pooled their resources and jumped into the wine business. “We’re not the doctor, the lawyer, the Wall Street executive who came in and decided to make wine. We came in without capital backup,” says Boyd. “But, we finally had the chops to go out and make this happen and do it our way.”

There were, predictably, challenges and naysayers along the way. “Even though there are thousands of other brands that are trying to do the same thing and are much more funded initially, we believed in each other’s skills and decided we were at the right place to make a go of it,” says Boyd.

“The key in the wine business is to have a good network and resources,” adds Jarman. “It was a matter of putting it all together—getting the right quality of fruit and getting Mitch to come in an build a brand. It was a match made in heaven.”

So what is the Joseph Kent brand all about? “Laissez les bons temps rouler.” Translated from Cajun French to English, it means, “Let the good times roll.” “It’s about encapsulating who we are: two young men, working in Wine Country, balancing what’s important—life, friends and family,” says Boyd. As for the wine, their goal was to produce a great quality wine that over-delivers for the pricing model. “Our general philosophy is to produce a wine with depth, complexity and age-ability, but also approachability at an early age,” says Jarman.

Naturally, the Joseph Kent label has a New Orleans, jazz festival feel, and the wines range in price from $24 to $50. Each is named with a Louisiana flair. The Sauvignon Blanc, for example, is named Joie De Vivre (pronounced jwa-de-veev), which means the joy of living, because the two young men enjoy everything they do and the name lends itself to their winemaking style. They also feature a red wine, Gris-Gris (pronounced gree-gree), this term in Voodoo represents a small blend of personal items that help bring good luck and ward off evil spirits.

Joseph Kent wines are served in some of the highest-end restaurants in the country, including San Francisco, New Orleans, Dallas, Portland and more. They’re also available in high-end retail stores such as Back Room Wines in Napa.

How do they work together yet remain friends? “We’re both experts in our sides of the business,” says Boyd. “We both know those sides and trust each other.”

“And we don’t meddle in each other’s affairs,” adds Jarman.

“The only thing we argue about is college football,” says Boyd. “I went to Oregon and Jarman’s family went to LSU, so he [Jarman] grew up an LSU fan.”

What’s the key to their success?

“Taking a calculated risk,” says Jarman. “You’ll never do anything if you don’t put yourself out on a limb. But it’s important to be careful where you put your money and how you build relationships.”

“It’s also about quality,” says Boyd. “We can do all the marketing, but if the quality isn’t there, it won’t sell. Quality in winemaking is the most important aspect. As for marketing, it’s about consistency of the message. Lots of brands change their pricing and wines so frequently that it’s hard for the consumers to grasp what’s going on.”

Where do they hope to be in the future? Both young men, now 35, still have day jobs, but the goal is to eventually focus their efforts full time on Joseph Kent Wines. In the meantime, they continue to produce quality wine from Napa grapes, and it’s written in their company’s bylaws that they must attend the New Orleans Jazz and Heritage Festival every year.



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