Ernst & Young’s Northwest Entrepreneurs of the Year

How valuable would it be to know in advance which business leaders were about to rocket to fame? Who knew 20 years ago, for instance, that Michael Dell would soon become synonymous with quality computer hardware?

The Ernst & Young Entrepreneur of the Year (EOY) award program, which picked Dell as a national winner back in 1989, provides an annual glimpse into what the future may hold for todays hard-working and innovative business owners. For the last 23 years, the EOY award has spotlighted growing entrepreneurial businesses before they become internationally recognized names.

The following seven Pacific Northwest region award recipients and 15 finalists represent the brightest innovators and leaders across a wide spectrum of business sectors. Categories for this years winners include financial services; health and life sciences; media and entertainment; retail and consumer products; services; software; and technology.

To be eligible for the awards, nominees must be owners or managers of private or public companies that are at least two years old. The nominees must also be primarily responsible for the recent performance of their companies and active members of top management. Ernst & Youngs independent panel of judges selects finalists and award recipients, based on a number of factors, including entrepreneurial spirit, financial performance, strategic direction, community/global impact, innovation and personal integrity/influence.

The EOY programs regional component recognizes business leaders in more than 135 cities in 50 countries worldwide. Regional award recipients will be eligible for consideration for the Ernst & Young Entrepreneur of the Year 2009 national awards, which will be announced this November.

Some of the names in these pages are longtime legends of the Northwests business community. Others are unsung heroes who are just breaking onto the scene with innovative ideas and a healthy appetite for taking risks. Together, they represent the present and future leaders of the Northwest regions recovery from the current economic downturn.

Financial Services & Real Estate
Winner: Jeffrey S. Lyon, CCIM, SIOR, Chairman and CEO, GVA Kidder Mathews (Seattle)

Jeff Lyon has real estate in his blood. During his undergraduate years, he began his career selling residential properties via his second-generation family business, Lyon Commercial. In 1991, Lyon was instrumental in facilitating the merger of his firm with Kidder, Mathews & Senger and worked as an agent, broker and consultant for the new entity, GVA Kidder Mathews, until 2000, when he was named CEO. Since the merger, GVA Kidder Mathews has become the top commercial real estate company in the Pacific Northwest.

One of the biggest factors contributing to the companys success has been Lyons commitment to empowering his employees. His entrepreneurial policies of promoting from within and rewarding employees through results-oriented compensation packages have helped set GVA Kidder Mathews apart from other real estate firms. Employees there are also given the opportunity to become shareholders, providing the stake and incentive to ensure the companys success.

Over the past few years, Lyon has shepherded GVA Kidder Mathews through a period of vigorous growth. In 2004, the firm expanded to Portland, and then established a foothold two years later in California. After the company purchased a firm in San Francisco in 2006, Lyon recruited two managing partners to oversee further expansion in northern California, including acquisitions in Redwood City and Silicon Valley in 2008.

Despite the shaky economy, GVA Kidder Mathews still plans on establishing six to eight offices and hiring more than 100 workers in the northern California market.

Lyon serves on the board of trustees for the ArtsFund and the Business Advisory Board at the Milgard School of Business (University of WashingtonTacoma), and has been a two-time president of the CCIM Institutes Washington Chapter.

Finalists:

Michael Butler, Chairman and CEO, Cascadia Capital

After earning a political science degree from the University of Washington, Michael Butler expected to enter a career in public service but instead found his true calling in the banking industry. He cut his teeth on Wall Street, compiling a stellar career with Morgan Stanley for 15 years before deciding to move his family back to Seattle in 1999 to create his own investment bank, Cascadia Capital. Following the dot-com collapse, Butler and his board reorganized and began to look into new media and environmentally sustainable industries as emerging opportunities for investment. Today, Cascadia Capital is a national leader in the growing clean tech sector, focusing on the Pacific Northwest and Intermountain West regions.

Butler is also dedicated to giving back to the business community via participation in economic development panels and was recently asked to serve on Seattle Mayor Greg Nickels economic advisory committee. He is also a board member of the nonprofit environmental organization Climate Solutions.

David R. Nilssen, CEO, Guidant Financial Group Inc.

Born with an entrepreneurial spirit, David Nilssen ran two fast-food franchises and a landscaping business while still in his teens. After getting into real estate, he co-founded Guidant Financial Services in 2003 at the tender age of 25. Nilssen saw a golden opportunity to serve the then-untapped market of retirement savings account investment. Before Guidant, no one had offered a flat-fee, one-stop shop for self-directed IRA structures. Today, through Nilssens pioneering use of technology that enables customers to use their IRAs to invest in real estate and small businesses, Guidant is one of the fastest-growing players in the industry, with 76 employees and a 50 percent internal promotion rate. In 2007, Nilssen co-founded NuWire Investor, an online media resource for investors. Nilssen, who is active in supporting such organizations as Rebuilding Together and the Susan G. Komen Race for the Cure, was a co-recipient of the Small Business Administration National Young Entrepreneur of the Year award in 2007.

Health & Life Sciences
Winner: Lisa G. Shaffer, Ph.D., President and CEO, Signature Genomic Laboratories LLC (Spokane)

Its not often that one person can be considered responsible for creating an entire industry. However, for Lisa G. Shaffer, founder and CEO of Signature Genomic Laboratories, the description is fairly apt. As a research scientist at Baylor University, Shaffer developed a new testing procedure in the field of cytogenetics, which studies chromosomal abnormalities. This innovation, called the microarray, is faster and more cost effective than the previous testing technology. The microarray also provides accurate results 17 percent more often and can help physicians make better diagnoses of genetic disorders, such as birth defects and mental retardation in newborns.

After being told for many years that her cytogenetic testing method was commercially unviable, Shaffer recruited other Baylor researchers and moved from Houston to a more accommodating business climate in Spokane to set up Signature Genomic Labs in 2003. On her own, she negotiated the intellectual property rights for the technology, raised seed money and hired a sales staff. Just one year after inception, the company broke even and has shown a profit ever sincea feat almost unheard of in the biotech field. The company was recently ranked No. 114 in Inc. magazines list of the 5,000 fastest-growing companies.

Shaffer also pulled off the difficult trick of transitioning from research scientist to the role of CEO. Her knack for management enabled her to raise capital in a tight economy, including a venture capital round in 2007, and kept employee turnover to a minimum. She also made the key, lucrative decision to licensing Signatures software to other research labs worldwide. Under Shaffers leadership, Signature has attained a greater than 50 percent market share in the cytogenetic testing industry. Shaffers stated goal is to take Signature Genomic to a liquidity event within five years, possibly an IPO or a major acquisition.

Finalists:

Dr. Mitchell H. Gold, President and CEO, Dendreon Corp.

If a cancer vaccine is the holy grail of medicine, then Dr. Mitchell Gold may be considered one of the lead crusaders. His company, Dendreon Corp., has grown from a research-focused organization to a leading biotech firm that may soon produce the first immunotherapy to be approved for the treatment of prostate cancer. This drug candidate, Provenge, recently earned high marks in its Phase III trial and could be commercialized by 2010. Gold, who lost his mother to breast cancer when she was 26, was inspired to become a urology resident at the University of Washington. He has since dedicated his life to the eradication of cancer. Gold joined Dendreon in 2001 and was named CEO in 2003, when it was still focused on finding treatments for viral infections and immune disorders. In 2006, he refocused all of Dendreons efforts on the development of Provenge. He also serves on the boards of the UW/Fred Hutchinson Cancer Research Center Prostate Cancer Institute and the Washington Biotechnology & Biomedical Association.

Thomas J. Clement, Chairman and Founder, Pathway Medical Technologies Inc.

When Thomas Clement sees a problem, he doesnt try to work around it. He labors day and night until he finds a solution. During his grad-student days at the University of Washington, he worked on the development of a catheter to help coagulate bleeding ulcers. Because of his perseverance and willingness to take calculated risks, his company, Pathway Medical Technologies, is one of the battle-tested survivors of the capital-intensive medical devices industry. When a major investor went bankrupt and two other competing companies failed clinical trials, Clement worked with his creditors, refocused his efforts to create a new product, secured a fourth round of investment and received FDA approval for the plaque-removing Jetstream G2 device to treat peripheral arterial disease. Despite the difficult economic environment, Clement expects Pathway to achieve profitability in the next 12 to 15 months. Clement is chairman of the Washington Biotechnology and Biomedical Association.

Media, Entertainment & Communications
Winner: Melissa Waggener Zorkin, President, CEO and founder, Waggener Edstrom Worldwide (Bellevue)

A quarter of a century ago, when Melissa Waggener Zorkin wrote a business plan for a new public relations firm, her father asked her: How are you going to leave the world better by doing this? Taking that question to heart, Waggener Zorkin has used it to inform her personal and business decisions at Waggener Edstrom Worldwide.

Starting with just two people, Waggener Zorkin decided that she would tell the stories of only the most innovative, cutting-edge companies. Since then, she has built her small operation into the worlds second-largest independent public relations firm, with more than 800 employees worldwide and a client list that includes such notable corporations as GE Healthcare, GlaxoSmithKline, Chevron, Microsoft and T-Mobile USA. A champion of the role of communications in driving innovation, Waggener Zorkin has advised some of the worlds leading technology companies during times of both success and setbacks. To set her firm apart from those PR firms that try to spin their clients out of difficult news, Waggener Zorkin prefers taking a realistic, head-on approach. Even during challenging economic times, Waggener Zorkin has continued to expand her companys global footprint and enhance its digital capabilities. Her business has developed a variety of unique resources, including the Narrative Network product, Master Narrative methodology and other specialized influence tracking and mapping tools.Another key element of the firms success is Waggener Zorkins commitment to what she calls social innovation. Under her guidance, Waggener Edstrom Worldwide gives 1 percent of its gross annual revenue in the form of charitable donations, pro bono services and dedicated staff hours, which have significantly improved talent recruiting and retention efforts. She also sits on the board of Mercy Corps and is actively involved with medical research, education, technology advancement and poverty reduction in the developing world.

Finalists:

Tracy Wong, Chairman and Executive Creative Director, Wongdoody Inc.

Already a legend in the advertising businessby working at Madison Avenue firms such as Ogilvy and Mather Advertising, and winning more than 200 coveted marketing and ad awardsTracy Wong took his career to stratospheric heights with the 1993 co-founding of his own firm, Wongdoody, with partner Pat Doody. His intention was to create an idea-generating paradise by promoting the democracy of good ideas and emphasizing the creative contributions made by every staff member. During the last 15 years, Wongdoody has expanded to employ 163 of the regions top brand strategists, graphic designers, retail specialists and experience developers. His firm has created campaigns for such notable clients as Alaska Airlines, T-Mobile, Bank of America, the Fox Network, CBS and many others. Under Wongs leadership, Wongdoody has kept up with the changing landscape of advertising, using each new technological development as a fresh entry-point for potential clients. Recently, Wongdoody was the promoter of the Seeds of Compassion, a five-day gathering that included a dialog with the Dalai Lama.

Jeremy Lewis, President and CEO, and Paul Thelen, founder, Chairman and Chief Strategy Officer, Big Fish Games Inc.

On their own, Jeremy Lewis and Paul Thelen were already stars in the business world, with Lewis a managing director at Goldman Sachs on the East Coast and Thelen a 14-year veteran with IBM, Mercer Management Consulting and RealNetworks. But after meeting three years ago, the two men realized that their talents perfectly complemented each other. Together, they would invigorate Thelens startup, Big Fish Games, a developer, publisher and distributor of family-friendly, casual games. Today, this east meets west partnership has resulted in Big Fish becoming the worlds largest online destination for interactive entertainment. Since Lewis became CEO in 2006, the company, which has more than 1,000 game titles in its catalogue, has tripled in revenues and expanded to 360 employees. Using analytics-based decision making to define its business strategies, Big Fish generates revenue through online and direct-to-consumer game sales as well as through licensing the companys intellectual property to other gaming companies. This year, Big Fish is launching two new businesses, Casual Community and Casual Massively Multiplayer Online Games.

Retail & Consumer Products
Winner: David Benjamin Ryan, President, Hood River Juice Co. (Hood River, Ore.)

The son of a dairy farmer, David Benjamin Ryan was born and raised near the Columbia River gorge and has always had a connection to the land. His father purchased a 32-acre orchard in 1970, which Ryan eventually took over in 1989, selling fresh raw juice and apples directly to stores until 1991. The next year, he decided to focus solely on juice production. By 1994, he had built the Northwests first flash-pasteurization apple juice plant.

However, construction of the plant coincided with a difficult time for the juice business in general. In 1996, he was forced to file for Chapter 12 reorganization, but eventually paid off all of his creditors and incorporated the food processing business of his operation into the Hood River Juice Co. (HRJC) in 2000. Then, in 2005, Ryan again found himself in dire financial straits and was literally hours away from foreclosure when a small investment firm stepped in to help.

That same year, business rebounded strongly, partly due to Ryans decision to switch his focus away from selling juice directly to consumers and instead marketing his product to larger beverage companies for their juices. Since this change, the company enjoyed 44 straight months of profitability through 2008.

Like all businesses, Hood River Juice is struggling with the economic downturn, but Ryan plans to navigate the troubled waters by seizing new opportunities. He recently started a construction company, Apple Development, which will lower Hood River Juices construction costs compared with hiring outside firms.

Ryan is currently involved with plans to build a new plant on the Hood River waterfront that will include provisions for summer camps and a negative carbon footprint.

Finalists:

David M. Knight, President and CEO, Teragren Fine Bamboo Flooring, Panels & Veneer

A veteran of four other entrepreneurial endeavors, David Knight has had a lifetime goal of building a global, environmentally-responsible business concept that creates significant shareholder value. With Teragren, he and his wife and business partner, Ann, have achieved this dream. Initially called TimberGrass in 1994, the company introduced ecologically sustainable flooring, panel and veneer products made of renewable bamboo. A core component of Teragrens mission is to neutralize the companys environmental footprint and to be carbon negative. Knight uses 70-percent recycled cardboard and plastic wrap derived from corn starch as packing materials for his flooring products. He has also chosen not to automate his manufacturing processes completely, recognizing the need to preserve the jobs of the independent Chinese farmers who supply his products at fair market value. For most of its existence, Teragren has seen revenues grow by roughly 40 percent annually. Even in the economic doldrums of 2008, the company grew 22 percent while the industry contracted.

Norbert Sporns, Director, President, CEO and co-founder, HQ Sustainable Maritime Industries

Norbert Sporns hopes to do for tilapia what StarKist did for tuna. As the co-founder of HQ Sustainable Maritime Industries, Sporns uses high-tech, sustainable aquaculture methods to grow tilapia in the tax-free Hainan Province of China for use in restaurant chains and grocery stores, which he markets in the United States under the TiLoveYa label. A native of Vancouver, B.C., Sporns earned a law degree, which he used to negotiate business transactions between China and North America. After hearing about the farm raising of fast-breeding tilapia, he created HQ in 1997, began production in 2000 and took his company public in 2004. This year, the firm expects to produce 60,000 metric tons of the flaky, white freshwater fish. Using the Tyson chicken empire as a guide, Sporns has developed a vertically integrated business model that provides centralized control of the breeding, feeding, harvesting, processing, distribution and marketing of the fish.

Services
Winner: Robert Hansen, President and CEO, Bayview Limousine Service Inc. (Seattle)

Entrepreneur Robert Hansen knows firsthand about the rewards and dire consequences of taking risksboth in business and in life. At age 19, when he was a motocross champion and nationally ranked extreme sport performer on the motorcycling circuit, he suffered a terrible crash that broke his neck and left him permanently paralyzed below the shoulders. Undaunted, Hansen overcame his injuries to found the successful Bayview Limousine Service.

In 1990, after living on federal and state assistance following his accident, Hansen decided to go in to business with his best friend, who worked as a chauffeur at a local limousine company. Hansen invested his life savings to purchase a used 1984 Cadillac stretch limo and retrofitted it with hand controls and a Velcro cuff to allow him to drive. As the company slowly grew, he was able to add a new limousine each year and hire other chauffeurs to do the driving. During the past 20 years, his fleet has expanded to 62 vehicles, and he has personally selected 86 professional chauffeurs.

Hansen, a two-time recipient of the prestigious Limousine & Chauffeured Transportation Operator of the Year award, also takes pride in giving back to the community. Within the past few years, he has donated both cash and gift certificates for limousine services to many charities, and plans to regularly support organizations that give back to people, such as hospitals and the Make-A-Wish Foundation. He is also taking part in the Green Ride Global program, which will help reduce the companys carbon footprint by 5 percent via energy use reductions, waste management and fleet operation improvements.

Despite the economic challenges of 2008 and a downturn in revenues, Hansen was able to add several new accounts and start a 401(k) program with a 4 percent employer match benefit.

Finalists:

Paul Ellingson, President and CEO, Bargreen Ellingson

Paul Ellingson is clearly a successful entrepreneur in his own right as the mastermind behind the interiors of the Metropolitan Grill, The Ram and Red Robin during his 30-year career at restaurant firm Bargreen Ellingson. He has helped countless other restaurateurs to transfer their dreams onto a blueprint and then enabled these dreams to become reality. More than just a dealer of kitchen equipment, Bargreen Ellingson does woodwork and metalwork, as well as kitchen design and workflow consulting. The company also allows customers to try out equipment and train staff at its test kitchen facility. Ellingson credits much of his success to his decision to replace his firms employee manual with his On Board values that stand for respect, teamwork, use of good judgment, communication, learning, pursuing change, ownership and more. Although slowed somewhat by current economic conditions, Ellingson plans to expand operations considerably in both the Colorado and Alaska markets in the near future.

Thomas L. Varga, Managing Partner, CFO Selections LLC

Thomas Varga is what youd call a multitasker: Hes a chef, an avid mountaineer, an MBA degree holder, a teacher, a single father and, after 25 years of experience working with small businesses, a managing partner of CFO Selections. Created in 2002 as a financial consulting firm, CFO Selections expanded in 2006 to include an executive search service. Varga works to maintain strategic partnerships with banks, accounting businesses, human resources firms and other service providers so that they are able to help their clients with referrals. The company has seen significant growth since its founding, and has thrived during the recession as more companies have looked to outsource their CFO needs. In March of this year, Varga acquired an accounting consulting business and plans to increase its staff. CFO Selections employs roughly 20 consultants, who have an average of 26 years of experience. In 2007, Varga created the CFOS Foundation, which provides CFO services for nonprofit groups that benefit disadvantaged children.

Software
Winner: David L. Vernier, Founder and CEO, Vernier Software & Technology (Beaverton, Ore.)

At the height of the recession in 1981, Dave Vernier couldnt find a job to supplement his salary as a high school physics teacher in Hillsboro, Ore. After modifying the programs on his Apple II computer, he realized that other science teachers might find value in the six programs he had created. He and his wife, Christine, placed an ad for this new thing called software in an education journal and, to their surprise, made $215.

So began the journey of Vernier Software & Technology. While Christine quit her job to take phone orders and support requests, Dave Vernier resigned from his teaching position to experiment with creating software tools for science classrooms. Today, Vernier Software has been profitable for the past 28 years. It has never laid off workers and now has 100 employees.

Vernier, along with most of his employees, uses his education background to develop products around the needs of teachers and their classrooms. He enjoys taking suggestions from employees about improvements that can be made in the software development process. Dave and Christine Vernier have also instilled an awareness of social responsibility in the companys culture by granting full-time employees four paid hours a month for charity work, such as donating their time to teaching or to working with Habitat for Humanity.

As the company has grown, Vernier expanded from his original emphasis on physics instruction to take on a broad range of scientific subjects. He has oriented his software products to reach the whole spectrum of education from elementary schools on up to universities. The business is susceptible to market swings, as it often depends on school budgets, but Vernier expects his newest product release, a handheld data collection interface called LabQuest, to help carry his company through the current downturn with little impact to its overall growth.

Finalists:

Rajeev Agarwal, Founder and Managing Consultant, MAQ Software

Rajeev Agarwal created MAQ Software in 2000 with the belief he could build a software company that develops technology in half the time and at half the cost of competitors. Agarwals entrepreneurial spirit dates back to his youth, when he overcame adversity to be admitted to a top university in India. Since leaving India for the United States, Agarwal held various management positions at Microsoft before branching out on his own with MAQ. During the past nine years, his company has achieved 474 percent growth, and now provides research and development for new technologies related to Microsofts Windows and Office products. By complementing his personnel in Redmond with other teams in India, MAQ provides round-the-clock software support service. Recently, the companys focus has shifted to cloud computing, social networking sites and new computing platforms such as smart phones. Agarwal has also established a nonprofit organization promoting education to children in India, where he spends about three months of each year helping to build math and science facilities.

Fred A. Brown, Founder and CEO, Next IT Corp.

Fred Brown is one of the few IT specialists who knows how to lasso a wayward calf as well as he knows how to develop a software algorithm. Raised around horse ranches and rodeos, Brown leveraged his parents entrepreneurial spirit into the creation of seven businesses. His latest venture, Spokane-based Next IT, was launched in 2002 to help personalize web-user interactions through natural language. Using his own money as well as funds from angel investors, he acquired software developer Spectre AI and further developed an algorithm now known as ActiveAgent. Using a combination of information retrieval, natural language processing and customer experience technologies, the technology can understand user intent and provide tailored responses quickly. One of his recent triumphs using this technology was the popular Ask Jenn customer interface feature on the Alaska Airlines website. Brown serves on the board of trustees at Gonzaga University and supports several educational and scientific organizations in the Northwest.

Technology
Winner: Douglas Fieldhouse, President and CEO, Vesta Corp. (Portland, Ore.)

With a father who worked for the CIA, Douglas Fieldhouse spent his childhood living abroad across Europe and intermittently in Washington, D.C. This formative experience helped instill in him a healthy interest in international relations along with the knowledge that the best way to be successful is to take risks that no one else would.

After advising various businesses throughout the United States, Europe and Asia for 15 years, Fieldhouse launched Carrier Services Inc. (CSI) in 1995 as a means to sell prepaid, rechargeable long-distance calling cards. Two years later, the company was on the brink of collapse and was in serious need of additional funding. Fieldhouse then took over operations as CEO in 1997 and managed to convince investors to provide more funds. Since then, he has transformed CSI into Vesta Corp., a world leader in electronic payment solutions that provides transaction processing, risk management and customer service for many of the worlds largest telecommunications firms. Vesta also indemnifies its customers for 100 percent of any losses due to fraud.

Soon after becoming Vestas CEO, Fieldhouse traveled to China and began a business relationship with ChinaDotMan, a pioneer in electronic airline tickets. In 2005, Vesta acquired the Chinese company, which had positioned itself in the center of a booming Asian market. Fieldhouse is careful to populate his overseas offices with staff members familiar with regional customs. After opening a satellite office in Ireland in 2005, he hired local talent rather than importing American workers.

Fieldhouse has become heavily involved in a Portland-area angel investment group, through which he invests in three or four businesses each year. At the beginning of each year, he allows his employees to choose which three charities they would like to contribute to and provides matching donations in Vestas name. Fieldhouse is committed to the eventual replacement of plastic swipe cards with wireless mobile electronic devices.

Finalists:

Stephen Marsh, CEO, Smarsh Inc.

When one thinks of Wall Street, the term customer service does not always leap to mind. Stephen Marsh, however, made personalized service a hallmark. As the lone employee of financial consulting service Smarsh in 2001, Marsh developed proprietary software, sold services and handled support calls 24 hours a day. Today, he runs a 50-person, 6,000-client operation, with offices in Portland, Ore. and New York City. While most of Smarshs competitors worked through existing channel partnerships, Smarsh chose to develop a direct sales team. By initially focusing on a niche marketarchiving e-mails in the financial services industrySmarsh built a unique level of trust with customers. Marsh has led the companys 100 percent year-over-year growth, using a software-as-a-service business model, which allows the firm to offer expertise while saving clients time and money. Marsh, who is helping Portland Mayor Sam Adams formulate strategic economic growth, has also implemented policies to conserve energy and reduce the companys overall carbon footprint.

Ben Wolff, Co-chairman, Clearwire Corp.

Like a relay runner, Clearwires Ben Wolff has taken the baton from founder Craig McCaw and is sprinting through the last leg of the companys long race to provide a national 4G wireless network. Over the past five years, he has provided wireless internet service for more than 500,000 customers and is forecasting that the Clearwire network will be available for more than 30 million customers in the next five years. As a teenager, Wolff began his career by opening a high-end lighting fixture store. After selling the store and making partner at a major law firm, he signed on to run McCaws private equity firm, Eagle River, in 2003. He later helped form Clearwire by developing relationships with Comcast, Time Warner, Google and Sprint. As former CEO and now co-chairman of Clearwire, Wolff promotes an open-door culture in which employees are considered partners and are provided with the autonomy to think outside the box. He forecasts that Clearwire will grow to 30,000 employees in the coming years.

The online version of this story has been corrected.