WisBusiness: TomoTherapy insiders detail road to success
By Patrick Fitzgerald
Wednesday’s portion of the Wisconsin Entrepreneurs’ Conference in Milwaukee dissected the vision and ingenuity of panelists from TomoTherapy, a cutting edge biotech firm based in Madison and several UW-Madison students who launched their businesses early on in their undergraduate careers.
“From idea to IPO: The TomoTherapy story” brought CEO Fred Robertson and Vice President Shawn Guse to the table to discuss TomoTherapy’s rise from the brainchild of founders “Rock” Mackie and Paul Reckwerdt in UW-Madison’s research labs to an international company leading the field on innovative cancer fighting treatments.
Guse said investors had rebuffed the company on the grounds that “the health industry is going to crash, and manufacturing is dead in the U.S.” Yet despite the gloomy forecast that insiders and industry peers had projected, the company has seen unprecedented and unrivaled successes, securing its first venture capital investment in 1999, receiving FDA 510(k) clearance to market its Hi-Art treatment system in 2002, and opening its first European office in Brussels, Belgium during the summer of 2006.
Robertson and Guse, recent additions to TomoTherapy who took their positions with the company in 2005, set apart myth from fact and imparted their advice to future players in the biotech market.
Robertson credited founders Mackie and Reckwerdt for avoiding “founderitis” and relinquishing total control of the company, instead focusing on presenting a brand new product to the market annually.
“They had the brilliant ideas, but they didn’t have all the knowledge,” said Robertson, while maintaining the “stick to your guns approach” adopted by the company.
“The platforms we are replacing are decades old, so competitors try to portray us a niche market,” he said.
Guse offered three tenets emerging companies should adopt, pressing the need for businesses to embrace corporate partnerships to speed entry into the market, secure angel or venture capital investments to maximize early growth and seek investment in the form of customer deposits.
As companies grow and spark intrigue around the marketplace, Guse said that formula that has kept TomoTherapy buzz alive and well, sparking new business ventures which have seen the company’s products distributed in fourteen countries.
“We give them the Kool-Aid at the door, and they keep coming.”
The day’s second panel, “Guerilla Marketing: Success stories from young entrepreneurs,” featured Tyler Leeper, Troy Vosseller, and Nate Lustig as the up-and-coming business leaders with the social networking savvy to see their ambitions to fruition.
Vosseller, who co-founded Sconnie Nation LLC, an apparel company that was birthed in his dorm room during freshman year, termed his product “Sconnie” to capture quirky idiosyncrasies most Wisconsinites could appreciate.
“Sconnie is really anything related to Wisconsin,” said Vosseller. “For instance, it could be a guy who knows all of Brett Favre’s stats, drinks PBR, and eats brats.”
Vosseller credited some of his company’s success to their student-friendly marketing campaigns that ingrained them in the UW-Madison campus community, which included installing a drink special widget on the company’s website so students can find out where to drink cheap, and a “Sconnie Life” section where anyone can post pictures of the Sconnie lifestyle in action.
“We had a Sconnie bar crawl, where we provided the first drink on us, and then everyone went out at night wearing their Sconnie shirts.”
“Its been viral like that.”
Tapping into the digital marketplace was the lifeblood for the panelists, who launched their grassroots business campaigns into cyberspace by means of social networking sites such as facebook, myspace, and youtube.
After losing out in the ticket lottery for home football games, Lustig and Nate Tucker, his business partner, bought www.thexchangehut.com, a website where UW-Madison students can buy and sell textbooks and tickets, eventually expanding the site to 110,000 student users nationwide.
Lustig tapped into similar online venues to spread word of the company, posting videos of himself and friends playing drinking games on youtube, and then tagging the video with a link to the company’s website.
“We did a lot of stupid stuff that worked.”
Beyond the importance of being online, the panel affirmed the importance of maintaining accessibility to their target demographic.
“A lot of it is about catering to your demographic,” said Leeper, owner of Wingra Canoe and Sailing Center. “Right now, it's retiring women, or people who want to canoe before or after work without the hassle of lessons.” “Most of our marketing is directed at college freshman,” said Lustig. “If we get them, we’ll have customers for a long time.”
All three owners plan on expanding and evolving their business through the near future, with Leeper hoping to open four new physical locations in the next two years, Lustig aiming to reach 500,000 registered users before the year ends, and Vosseller predicting Sconnie as becoming the next Madison standard for the next five to ten years.
“We’ve tried to become much more vertically integrated,” said Vosseller in response to potential players usurping their customer base. “It revolves around the fact we’re able to undercut the market and offer the product for less.”