Visiting Pineland

Over the weekend we took four of our kids and some friends to visit Pineland in New Gloucester, Maine.  The Pineland story is one of renewal and vision, so I wanted the kids to learn about it.

In the early 1900's, Pineland was the Maine state "school for the feeble-minded," a place where those unable to care for themselves could live and perhaps learn some simple farm work or craft. Mental patients, orphans, the poor, and social undesirables also sometimes found themselves shipped to Pineland.,Among those were the African-American families evicted in 1912 from Malaga Island in Casco Bay, as told in the Newbery Honor-winning novel Lizzie Bright and the Buckminster Boy.

Although at one point Pineland had two farms, 28 buildings, and over a thousand residents, changes in standards of care and the de-institutionalization movement gradually led to the school losing residents, funding, and reputation.  Eventually, in 1996, the last residents left, and the school closed.  Many of its buildings were now derelict and its farms abandoned.

In 2000, the Portland-based Libra Foundation, founded by my mother, bought Pineland and 1600 surrounding acres from the state.  Libra's president, Owen Wells, had a vision of building a multi-use campus with commercial buildings surrounded by a farm used for education and for supporting Maine farming as a way of life.  The foundation spent tens of millions of dollars restoring the campus, barns, fencing, and surrounding farmhouses.  We built a world-class equestrian center and 30 kilometers of cross-country ski trails.  We brought in a prize Holstein herd, Angus cattle, and Dutch Warmblood horses.

Today the Pineland campus is a serene and lovely place to work.  Over 300 people in 25 businesses occupy the restored brick buildings.  Farms, woodlands, ponds and gardens now comprise over 3500 acres set midway between Portland and Lewiston.  Visitors come for weddings, for hiking or skiing on  thirty kilometers of trails, for corporate retreats, or for educational events from cheese-making to felting.  We have sheep, chickens, beef cattle, prize milkers, dressage horses, and seasonal pigs.

Saturday night my family stayed in the very comfortable (huge kitchen, two living rooms) five-bedroom Collyer Brook Farmhouse.  Craig Denekas, current president of Libra, along with Owen Wells, gave us the tour Sunday morning.  We bought a pumpkin at the market and Welcome Center, which is stocked full of Maine products and wonderful sandwiches. Downstairs, visitors rent skis in the winter, and just outside, the cross-country trails lead across the fields and into the woods.

We toured the creamery, a state-of-the-art cheese-making facility, which now processes 20,000 pounds of cheese each month.  Mark, the cheese-maker, walked us through the process from pasteurization through adding rennet and bacteria to raking up the curds to stopping the process with salt, squeezing the cheese into bricks or wheels, and finally aging the bricks in the cold storeroom for up to two years for extra sharp cheddar.

Next we visited the hydroponic greenhouse, where without pesticides, and with nutrients dissolved in water, the manager grows fat tomatoes, bean sprouts, lettuce and cucumbers.  From the greenhouse we traveled to the cow barn to see the noble and patient-looking cows chomping and guzzling. In the calf barn we found that a calf's tongue is surprisingly rough, and that calves like licking hands and sucking on fingers. Finally we visited the riding center, a huge indoor arena with two attached fifteen-stall barns.  There a prospective Olympic dressage champion mare went through her paces on a lunge line, switching from walk to trot to canter on signs from her trainer too subtle for me to see.

After our tour (and tours are available to all) we returned to the Welcome Center for lunch.  The kids, intrigued by their grandmother's legacy and the Libra Foundation's unique brand of economic philanthropy and renewal, kept asking questions.  I was glad we had finally found time for this family exploration.

Venture or vulture?

Are venture capitalists vultures? A couple of days ago, WBUR aired a segment debating whether venture capitalists are good or bad for the economy and for employees. Listening made me think with pride of both my parents.

First, said the commentators, it's important to distinguish between venture capital and private equity. Venture capitalists fund start-ups. Private equity funds (like Bain Capital) buy existing companies, often struggling ones, and try to turn them around. Usually, private equity funds borrow a large portion of the money they use to buy the company. The company shoulders that new debt, which means that it must immediately cut costs or start making more money. Debt means the company has to tighten operations, which often means trimming the payroll. On some occasions, the "vultures" buy the company for its tangible assets and not because they expect the company to become profitable. In this case, the buyers may split the company, putting property and equipment in one half of the company which they then sell off, repaying themselves handsomely for their investment. The shell remainder of the company can then be left to fail, and its employees lose their jobs.

Venture capital grew up in the United States between 1957, when my father Robert Noyce and seven colleagues started Fairchild Semiconductor, and 1968, when he and Gordon Moore started Intel. Fairchild Semiconductor had to be started within, and be funded by, another company. By the time Intel started, potential investors beat on the doors asking to be let in on the deal. Venture capital allowed the electronics industry to burst forth as a major employer and engine for national growth in the sixties.

When he had the chance, my father sought to "restock the stream" that had nurtured him. Rather than joining a traditional venture capital firm, he became what's now called an "angel" investor, putting money into very early-stage startups that were often little more than a couple of bright young people with a great technical idea. He was devoted to the companies he invested in. In The Man Behind the Microchip, Leslie Berlin details how when one such company, Caere, came near to closing its doors, my father protested against a shutdown. "We have people," he said. "We need to keep it open. We have a responsibility to the employees and their families." To back up his words, he wrote a blank check and gave it to the CEO. "Don't make it out for more than a million dollars," he said. "That's all I have in that account." CAERE, a maker of barcode readers and later text readers, survived and eventually thrived.

That's good venture capital. But can you imagine the number-crunchers at Bain uttering sentimental words about responsibility to employees and their families? It's not that my father never laid people off to save a company, including Intel. He did. But first he stopped taking a salary himself. Laying people off was always an acutely painful last resort.

After my parents' divorce, my mother suddenly realized that she, too, had money to invest. She didn't become a venture capitalist, because she never shared my father's love of novelty and risk. But she did develop a philosophy that creating or preserving someone's job was the most effective form of philanthropy. At one point, Maine-based Nissen Bakery came up for sale. A decent family-owned business, Nissen badly needed major investment to upgrade its factory in order to stay competitive. Perhaps a private equity firm could have swooped in, borrowing enough to build a new Nissen factory, but such a firm might well have moved the company to some location with cheaper personnel or lower heating or transportation costs. My mother, instead, used her considerable wealth to buy the company outright with no outside financing. She invested enough that Nissen could build a state-of-the-art new factory right in Maine. After my mother died and the bulk of her estate went into the Libra Foundation, Nissen had to be sold. (A charitable corporation can't keep owning a business like that.) But by that time Nissen was thriving enough that the buyer moved more business into, rather than out of, Maine.

It's possible to invest money, take risks, and keep the interests of employees and the community in mind even when working to make a business efficient and profitable. The people who do so are real contributors to our society, and building for the future is what motivates them and makes their work fun. Maybe we should call them "adventure capitalists."

Biathlon World Cup in Northern Maine

Biathlon, such a popular televised sport in Europe that it's sometimes called Europe's Super Bowl, is little known in the United States, but that is something a dedicated group of coaches, athletes, and volunteers in Aroostook County are working to change. Biathlon combines cross-country skiing and target shooting, a pairing that seems random until you consider its roots among the infantries of Scandinavia. Although those enthusiasts who first promoted biathlon for the winter Olympics talked about its origins in winter hunting, in fact it began a few centuries ago as a competition between Swedish and Norwegian soldiers guarding a border.

This past weekend, Leo, Damian and I flew up to Presque Isle, Maine, not far from the Canadian border, to see a World Cup competition in biathlon. There are only three World Cup certified competition courses in North America at the moment. Two are in Aroostook County, Maine, and the third is in Vancouver, too far from Europe to be convenient as part of the World Cup tour. This week the athletes and coaches and waxers descended on Presque Isle; next weekend they'll be even farther north in Fort Kent, Maine.

In a biathlon competition, skiers race around a course of 2-3 kilometers, arrive at a shooting range, and shoot at five targets the size of a coffee saucer. They usually make four race circuits with shooting followed by one final circuit sprinting to the finish line. Missing a shooting target is penalized either with time or with a small additional loop to ski for each target missed. Skiers shoot two of their four sets from a prone position and two sets standing.

At the Presque Isle Northern Heritage Center, the stands are set up at the shooting range, but by walking around to the lodge balcony you can also see the start; by walking along a catwalk you can stand on a bridge under which the skiers pass as they race around the course. Spectators cheer indiscriminately for competitors of all nationalities. For some reason, fans also ring cowbells. When a shooter hits the target, the bells ring; when a shooter misses, you can hear a collective sigh.

What gives biathlon its excitement is the shooting. A skier may have fought her way to the front of the pack, but one missed shot suddenly gives the person behind her a chance to take the lead. Skiing at higher speed leads to a higher heart rate and a greater chance of missing a shot. These factors, combined with vagaries of wind and weather, make frequent lead changes an expected part of the game. During the women's pursuit yesterday, the wind came up and threw almost all the athletes off their shots. At one end of the shooting range, flags billowed eastward; at the other end, the flags fluttered westward. Only in the middle was there relative calm, and that was probably delusory.

Still, my readers may wonder, why this sudden interest in biathlon? The truth is, I'm very proud of biathlon in Maine because the trails, the lodges, and the Maine Winter Sports Center that runs them are a creation of the Libra Foundation, founded by my mother. Libra is dedicated to improving the life of Maine residents, and two of our areas of focus are the well-being of young people and economic development. Owen Wells, our visionary president, looked at Aroostook County and determined that its most reliable assets were potatoes (we helped turn around a farmer-owned packaging company called Naturally Potatoes) and snow. Northern Maine had a Scandinavian heritage and a lost tradition of cross-country skiing; Owen proposed that we try to bring that tradition back by creating the Maine Winter Sports Center. We hired great people, starting with Andy Shepard, who has built a constituency for skiing in Maine towns. We built lodges and world class trails at two venues and other trails at high schools across Aroostook County. We brought in European coaches, and we started a training program.

The US team still has a way to go before it can truly challenge the Europeans, but the tradition is building. Schoolchildren who otherwise might have spent the winter vegetating indoors are getting outside and training for a sport where they can excel. And Maine is benefiting from the international visitors, the publicity, and the television revenue that comes from hosting some of the world's most popular sporting events, even on Super Bowl weekend.