Generation of Wealth

Minneapolis Star Tribune Business Forum: Minnesota's homegrown prosperity (March 30 2014)] "In the October 2006 client letter I wrote a lengthy paragraph about the passing of William C. (Bill) Norris the founder of Control Data here in Minneapolis. I noted that the Twin Cities has three major economic segments which have propelled our growth over the years-food products medical technology and computer technology. The food industry I noted went back to the Pillsburys and the Bell family of General Mills medical technology to Earl Bakken of Medtronic and computer technology to Bill Norris of Control Data. You could refer to page 9 of that October &lsquo06 letter in the client letter archive on our website to read what I said then having just read it again myself I find it as interesting as when I wrote it. The founding of Control Data in 1957 really marked the beginning of an era in the Twin Cities that made history as it was unique and probably not duplicated again until the Boston Route 128 or Silicon Valley VC era many years later. All this has been laid out in compelling fashion in a new book titled Generation of Wealth by Donald M. Hall. Do yourself a favor and get this book which will be available from Amazon Barnes &amp Noble and most other booksellers by the time you read this. Let Don take you back to that time nearly 60 years ago when a few talented men in search of independence from a large bureaucratic organization called Sperry Rand started Control Data raising start-up funds without a broker sponsor at $1 per share literally door to door and with gatherings of friends like a Tupperware party. It was indeed the beginning of an era written by a man who lived through much of it. Don Hall now 76 worked as a young man as an analyst at Control Data and then for 20 years in the local securities industry. Some of you reading this will remember him from the old days of RJ Steichen a brokerage which he owned part of with the late Jack Feltl. "But let's step back a bit. I was there too at that time. Well almost. I graduated from the University of Wisconsin with an MBA in 1956 and went to work as a securities analyst at the American National Bank and Trust Company on LaSalle Street in Chicago. That is a long story most suited for my own book someday. In early 1959 I relocated to Rochester MN as the junior member of a team managing the Mayo Foundation dollars. This was two years after the event referred to as the beginning of an era when Norris and others had raised capital to put Control Data on its way. So also was the stock on its way a subject of coffee shop talk even at the Mayo Clinic where the spectacular rise in the price of the stock was discussed almost daily because it was indeed like a rocket ship. By 1961 or so the stock had gone to $100 but ultimately adjusted for splits that $1 stock became worth well over $700 per share. Millions were made even by those who sold along the way to buy what became a very expensive car or house! "But I digress too much. As I said I was there and lived through most of it. Company after company followed in those footsteps raising capital at $1 per share or $1.15 if there was a broker--$1 for the company and $0.15 for the broker. They were well paid imagine a 15% commission today! And on and on it went some succeeding some failing but if you lived through it as I did this is a fascinating well researched and well written book that will bring back memories. Even if you did not live through that period you will find it captivating if you let Don take you back in time to experience it as if you were there. But this book is not just about Control Data as the title suggests you will read the story of Medtronic's beginning as well as many others such as Cray Research and Possis. You will also read about our one and only Manny Villafana his successes (St. Jude) and failures (CABG Medical). As George Zimmer said with his signature slogan in the Men's Wearhouse commercial 'I guarantee you will like it.'" - Richard W. Perkins CFA President Perkins Capital Management Inc.