The lemonade stand gets an upgrade
By Sara Peters

Once upon a time, in Professor Zschau’s class…
Lately, it seems that a whole book of success stories might begin with those words. Wander through the lounges at the School of Engineering and Applied Science (SEAS), and one will surely find someone spinning a yarn about a booming business that began within these very walls.

Many students and recent alumni of SEAS are founding and running their own high-tech businesses. Many credit their success to lessons learned in ELE 491: High-Tech Entrepreneurship, taught by Ed Zschau ’61, professor of electrical engineering.

The following pages will introduce companies founded and run by young alumni who were once students in ELE 491. The principals may be under 25 years old, but the businesses are not the ubiquitous curbside lemonade stand nor the neighborhood paper route. These are the high-tech businesses of the future.

Intwine soothes businesses’ software woes
Sean MacIsaac ’02 and Tom Dixon ’02 can write many items on the list of “Companies they founded or considered founding.”

None of them matter much anymore, now that they have one company on a new list: “Successful companies they founded.”

Mr. Dixon, a bachelor of arts (A.B.) in philosophy and Mr. MacIsaac, an A.B. in computer science, founded and run Intwine, a service company that develops software for businesses with unique needs.

“ Sean and I had been planning on starting a company like this for a very long time,” Mr. Dixon said. “I’ve always started companies—real and fake ones. I went to high school with Sean, and I often sucked him into my schemes. So it’s been a long time coming. It was natural.”

Mr. MacIsaac is chief technical officer, Mr. Dixon is chief executive officer, and Russell “Rusty” Klophaus ’02 is chief software architect. Mr. Klophaus, who holds a bachelor of science in engineering in computer science, joined the company last year.

They said that they are less risk-oriented than many start-ups. They run Intwine by relying on intelligence, determination, and strong business principles.

Sowing success
Intwine is a Microsoft® Certified Partner, and all the software solutions they develop use Microsoft technology.

“ When the companies come to us, they already know they have a problem that can be solved with software,” Mr. Dixon said. “They just don’t exactly know how.”

Intwine creates a variety of software solutions. They may allow a company to easily generate visuals such as graphs and charts out of raw data. They can create images that are updated in real time to detect trends while they develop.

Intwine can also improve a company’s online questionnaires, surveys, and evaluations, and allow the software to automatically analyze the information gathered.

They also offer help to corporations trying to migrate their applications from Java language to the Microsoft .NET® platform. .NET is a set of software technologies that enables a high level of integration through the use of small, reuseable, Web service applications written in XML, a universal language for data exchange.

Natural selection
Intwine as it exists today was more grown than built. It was not constructed with a definitive business plan. Rather, in an organic fashion, it developed from basic elements like good ideas, entrepreneurial spirit, and hard work.

Mr. Dixon and Mr. MacIsaac had sown their entrepreneurial seed many times before. The duo had always been deeply interested in software; Mr. MacIsaac did a great deal of independent study of .NET platform as soon as Microsoft released it.

They began doing software consulting for businesses in order to raise funds for the “real” company they had yet to define, and they made contacts with financial services and Internet marketing.

It later made sense for them to go from “consultants” to “consulting firm”, and create a company to serve the businesses they’d come to know.

Photos by Jonathan Ernst Rusty Klophaus ’02 (left), Sean MacIsaac ’02, and Tom Dixon ’02 are the principals for Intwine, a software development company.

“ After graduation, Sean and I rented a three-bedroom apartment, took one bedroom each, and used the last one as the office,” Mr. Dixon said. “December of that year we moved into a real office (one that wasn’t a bedroom), and began marketing ourselves and taking on clients.”

Their business took root and flourished. The intellectual nourishment provided by ELE 491 may have been one of the secrets to their success.

“ Before we took Ed Zschau’s class we had made some forays into business, but we’d really never thought about any business aspects besides doing the work really well,” Mr. Dixon said. “We always thought, ‘Well, we’re good at software and we want to take over the world, so we’ll start a business.’ But business is almost all about marketing, strategy, and sales. If you’d have asked us about those things before that class, we would have denied their existence.”

Mr. Dixon still keeps his notes from ELE 491 class in his office for reference.

A year after beginning Intwine, Mr. MacIsaac and Mr. Dixon were looking to expand, and brought several young software experts and engineers onboard, including Mr. Klophaus.

“I’d known Tom pretty well at school, and I always kind of had a sense that he and Sean were doing things that were destined to be very successful,” Mr. Klophaus said. “We ran into each other at the first reunion and started talking about how well their company was doing, and throwing around the idea of me working with them.”

Intwine also has young computer scientists from Harvard University, the Massachusetts Institute of Technology, Carnegie Mellon University, Virginia Polytechnic University, and the University of Virginia on staff.

Intwine’s principals run to a meeting.

Strong saplings
Youth has not thus far limited Intwine. The worst they need to endure are some jocular jibes and hair rustling from their clients.

“ Up front it’s a little hard convincing people that despite the fact that we’re young, we’re capable,” Mr. MacIsaac said. “But typically that difficulty goes away once we start working. Our age becomes a nonissue.

“ We’ve done a fair amount of work for the Better Business Bureau, and it’s been successful because we work really hard,” Mr. MacIsaac said. “Of course, every time they introduce us to someone, they make jokes about us not shaving yet and that some day we’ll be able to drive.”

Of course Intwine’s chief officers are well aware that they have far greater responsibilities than shaving and driving. They nonetheless aver these are responsibilities they are glad to have.

“ It’s a little scary,” Mr. Dixon said. “But one thing we all feel is that there’s kind of no excuse for failure. This is our company. If it works it’s because of us, and if it fails it’s our fault.”

“ It’s interesting putting so much of yourself into something, being responsible for something, and seeing yourself grow because of it,” said Mr. Klophaus. “Every once in a while you take stock of yourself, and kind of impress yourself.”

“ I feel like I’ve learned more in two years than probably the entire previous 22 years of my life,” said Mr. MacIsaac. “I’ve never worked this hard in my entire life. I definitely feel that I’m in the right place for me now.”

Proximities ends the waiting game

Wait in line to park your car. Wait in line for your ticket. Wait in line to get through the gate. Wait in line to buy a drink. Wait. Wait. Wait.

Waiting in interminable lines takes the fun out of fun events like concerts, sporting events, and trips to the amusement park. In this speedy, high-tech age, must it be this way? Two fun-loving Prince-tonians say no, and are changing the rules.

Their company, Proximities, Inc., creates event traffic solutions with radio frequency identification (RFID), the same technology in the “prox cards” students and staff use to enter buildings on the Princeton campus.

The masterminds behind Proximities are John Lerch ’01, an alumnus of the electrical engineering department, and Joshua Girvin, a mechanical and aerospace engineering student taking a leave of absence from school to focus on getting the company on its feet.

Proximities, however, seems to have hit the ground running, having already worked with the International Speedway Corp. (ISC) on a NASCAR® event and an Indy Racing League event. They’re now searching for more corporations to partner with.

The company just moved from Princeton to the sunny shores of Melbourne, Fla., to be nearer to ISC and other corporate contacts.

Spark of genius
Suitably, the idea for Proximities sparked while Mr. Girvin, Mr. Lerch, and some friends were waiting in line for a roller coaster.

“ Being engineers, we started thinking, ‘This is pretty inefficient,’” Mr. Girvin said. “Why do we have to stand on line in the heat? We’re not having any fun. There’s got to be a way to electronically queue yourself in line and come back when it’s your turn.

Photo by Preston Mack John Lerch ’01 (left) and Joshua Girvin just moved their company, Proximities, LLC down to Melbourne, Fla.

The familiar RFID technology seemed a good basis for their musings. RFID consists of a chip containing identification data and an antenna. In use as a proxy card, the user brings the RFID within a few inches of an electronic RFID reader, and is either granted or denied access based upon the ID and privileges programmed onto the card.

The Proximities duo considered using RFID in the form of a bracelet to quickly identify the wearer and his or her place in line.

Further brainstorming led them to wonder if the bracelet could also speed up purchasing. The wearer’s credit card information could be linked to the bracelet, or the bracelet could be scanned at each purchase to run up an electronic tab that could be paid all at once later.

“ But we thought of an immediate problem with purchasing,” Mr. Lerch said. “What if you take the bracelet off, or lose it? Then someone can take it and run up your charges.”

They solved this problem by devising and patenting a way for the bracelet to deactivate once it is removed or broken.

This gives patrons the comfort of knowing that the purchasing power and identification ability of the bracelet is useless once it leaves their wrist. It also helps the event security staff.

“ The security thing of the band is nice for the venue because they can control access,” said Mr. Lerch. “Someone who isn’t a VIP can’t get into a VIP area, and someone under 21 can’t borrow their older brother’s bracelet to buy alcohol.”

Critics of the technology worry about the loss of rights to privacy and anonymity as well as the risks of identity theft.

The gentlemen at Proximities understand these concerns, and have learned how to counter the argument in meetings with potential investors.

Photo by Preston Mack Proximities’ bracelets could be used at concerts, sporting events, and amusement parks.y, Proximities, LLC down to Melbourne, Fla.

“ Our most common response is, ‘Do you have a CVS card?’” Mr. Girvin said, referring to the shopping cards used in some supermarkets, pharmacies, and convenience stores. “Consumers are generally willing to give out basic information about themselves in exchange for an added convenience. Making that comparison has done a lot to ease people’s concerns.”

“ RFID is big in the news right now,” Mr. Lerch said. “There is a lot of talk about privacy. But we don’t sell information about people.”

One of Proximities’ ultimate goals is to have the bracelet completely replace the traditional paper tear-and-enter ticket. This may be a lofty goal, but their history gives them good reason for optimism.

Photo by Preston Mack John Lerch and Joshua Girvin run a test of their quick automated identification and purchasing system.

Success story
Proximities has had a great deal of success in a very brief time.

The fateful day at the amusement park that catalyzed Proximities’ genesis happened just over two years ago, in July 2002.

The corporation was formed about a month later, financially floated by the open wallets of friends and family.

By May 2003 they had secured substantial investors.

This winter they put the product to work at the Toyota Indy 300, and again this summer at the Pepsi 400.

At the beginning, they committed much of their resources to some very enjoyable research.

“ The friends and family investors got a kick out of the fact that we were taking their money and going to amusement parks and night clubs,” Mr. Lerch said.

Their investors, however, were not truly fooled by the seeming frivolity of the market research, nor by the youth and greenness of the chief executive officers.

“ We’ve been good about recognizing the fact that we’re young, and balancing that by involving our investors, whom are very experienced,” Mr. Lerch said. “Using our youth is actually our investors’ favorite tactic when talking to potential clients. We’re the age of most of the patrons of these events.”

In fact, Proximities rounded out their staff with other young, entrepreneurial engineers like themselves.

Tom Peff ’01, Peijen Shawn Mou ’03, and John Norair ’04 are currently on staff. Brian Tsang ’04, Melissa Chen ’05, and Phillip Wei ’05 also served on the Proximities staff in the past.

Still having fun
So far, the deep commitment, the hard work, and the cannibalistic nature of the business world have not deterred the two young Princetonians. They agree that their experience thus far has been “tough” but “fantastic.”

“ We definitely are feeling positive,” Mr. Girvin said. “I think we both want to continue doing this.”

“ You learn so much by doing what we’re doing,” Mr. Lerch said. “We’re interacting with people that most people our age would never work with. It’s trial by fire, almost.

“ Plus, we’re living on the beach right now,” said Mr. Lerch. “Which isn’t too bad.”

Princeton Power brings energy into the future
"But I was going to Tosche station to pick up some power converters!” whines Luke Skywalker in his opening line of Star Wars Episode IV: A New Hope.

Power converters were clearly important to the young would-be Jedi, an interest he shares with the young engineer-entrepreneurs at Princeton Power Systems (PPS). They take power converters and their office volleyball team very seriously, taking most else with youthful levity.

PPS makes electrical power conditioners that allow for more precise control of industrial devices, conserve energy, and facilitate more widespread adoption of clean, renewable power sources.

Princeton Power’s office-slash-lab-slash-machine-shop, located on Princeton’s Forrestal campus, is top to bottom a treasure trove of young Princeton engineers. Darren Hammell ’01, with his bachelor’s of science in engineering (B.S.E.) in computer science, is president and chief executive officer. Erik Limpaecher ’01, a B.S.E. in electrical engineering (EE), is lead controls engineer. Mark Holveck ’01, a B.S.E. in mechanical and aerospace engineering (MAE), is vice president of engineering.

One of the founding members is John Lerch ’01, who left the company to begin Proximities, LLC (see page 6). Mr. Lerch was replaced as vice president of research and development by Bijan Treister, an Australian expert in wireless systems.

Also on staff are Casey Jacobson ’03, a B.S.E. in EE, Joe Sarokhan ’03, a B.S.E. in MAE, and Brad Friedman ’05, a summer intern who is majoring in computer science.

All around the table they agree that they love coming to work.

“ My father once said,” Mr. Limpaecher said, “‘Once you get bitten by the self-employment bug, there’s no going back.’ He was right.”

Photo by Frank Wojciechowski Clockwise from center, Erik Limpaecher, Brad Friedman, Joe Sarokhan, Casey Jacobson, and Darren Hammell are the minds behind Princeton Power. Mark Holveck is not pictured.

Zero to light speed
Princeton Power’s explosive beginning was ignited in ELE491.

Two members of the class, Mr. Limpaecher and Mr. Lerch, were inspired to enter the Princeton Business Plan Contest.
They decided to develop their business plan around a new technology called the AC-link, which Mr. Limpaecher’s father, Rudy, invented and patented. The AC-link is, essentially, a new circuit design and advanced algorithms that make it possible to more precisely control and convert different types of power.

Mr. Lerch and Mr. Limpaecher decided to ask “the best engineer [they knew],” Mark Holveck, to join their team as well. Mr. Holveck introduced them to Mr. Hammell, and the four entered the contest together.

At this point the Princeton Power plotline picked up at a light–speed pace.

First, PPS won first place in the 2001 business plan contest.

Professor Zschau, now the chairman of Princeton Power’s board of directors, introduced the triumphant team to Greg Olsen, an angel investor.

Then, one hour after graduating from Princeton, Mr. Limpaecher received an e-mail from Mr. Olsen, offering to invest in Princeton Power. Within a week they had the term sheet signed, and within a month after graduation the deal was closed.

“ To be honest, it never occurred to me to be worried about the risk,” Mr. Limpaecher said. “I never once focused on the possibility of failure.”

Ground control
The novice businessmen’s optimism was affirmed by their very supportive investors, to whom they credit much of their success. The Princeton Power businessmen keep their investors close and heed their advice. In return, they receive the investors’ trust and their positive attitude about the company’s young staff.

“ Their response to our age has been very positive, which is probably very unique,” Mr. Hammell said. “They always remind us what a huge benefit it is to be single, without kids or a mortgage, since this makes it much easier to accept long hours and risk—both essential parts of any start-up.”

“ I’ve heard one of our investors say that when he receives a work-related e-mail from one of us at 2 a.m., we remind him of when he was first starting out,” Mr. Limpaecher said. “I think everyone agrees that the energy young founders and employees bring and the business experience that our investors bring is a good combination.”

“ Lacking experience would hurt us in some areas,” Mr. Hammell said, “but our investors being closely involved enables us to fill in the holes.”

Despite their great luck in finding the ideal investors, the company’s founders do not believe that they were simply charmed.

“ There is nothing inherently magical about starting a company,” Mr. Hammell said. “It takes good ideas, great people, and a ton of work.”

Photo by Frank Wojciechowski Erik Limpaecher and Brad Friedman work on one of Princeton Power System’s power conversion products.

Advanced technology
Ignited by the AC-link technology, powered by optimism and steered by enthusiastic investors, the young businessmen keep Princeton Power driving forward by doing this “ton of work.”

Much work went into developing new applications of the AC-link technology.

The company’s products are all power conditioners that operate between power generators, a utility grid, and an electrical device. The three core products are the motor controller or variable speed drive (VSD), the wind-turbine converter, and the grid-tied inverter.

The VSD operates between the utility grid and an electric motor. It can change the frequency and voltage of the electric power being conveyed by the utility grid. This allows the user to run the motor at any desired speed, thus saving energy and making more precise processes possible.

The wind-turbine converter operates between a wind turbine generator and the utility grid. It can convert the energy from the turbine to whatever frequency necessary to export to the utility grid. This allows the wind turbine to run at variable speeds to match wind speed, thus reducing stress on the blades and increasing the amount of energy captured.

The grid-tied inverter converts the direct current (DC) power produced by solar panels and fuel cells into alternating current (AC) power that can be exported to the utility grid.

Although Princeton Power Systems does not yet have any commercial products out on the market, they are aiming to do so by the end of the year. They are working with a company trying to develop a ropeless elevator that would use the VSD to control its speed.

“ It’s very Willy Wonka,” Mr. Limpaecher said.

In the meantime, they now have several contracts to keep them busy.

The Department of Energy is supporting the development of a small-scale wind-turbine power converter.

The U.S. Navy is supporting development of VSDs for ship propulsion applications.

The New Jersey Board of Public Utilities is supporting the development of a grid-tied, solar-power inverter and a pump-connected VSD.

They have a subcontract from Science Applications International Corporation for an Air Force project, which supports development of a power supply for the non-lethal, microwave Active Denial System program.

Need for teamwork
Handling all of this work requires a great commitment from each and every member of the team.

“ Everyone is involved in everything,” Mr. Holveck said. “Every person here is so important.”

This very fact is why other staff members were eager to join this young company.

Mr. Friedman said he was grateful to be able to expand his horizons, and work with both software and hardware.

“ I have more freedom and more control here than I would have at a big company,” Mr. Jacobson said. “I’m not pigeon-holed. At a bigger place I wouldn’t get to feel I was contributing enough.”

Although they are enjoying their experience thus far, they say their early expectations of running their own company do not compare to the reality.

“ I had no idea what I was getting myself into,” Mr. Limpaecher said. “Ed Zschau’s class did a great job of introducing and exploring the critical decisions, challenges, and methods of starting a company, but actually living in a startup day in and day out—putting your own sweat into it— is obviously a much more real experience.”

“ On the other hand, my expectation that it would be the most fun job possible has certainly come true,” Mr. Hammell said. “Though I guess I should have at least one other job before I can say for sure.”