Nebraska – Page 3 – artdiamondblog.com

Dohrmann and Quevedo Survive Creative Destruction of Inacom

“Cosentry, an Omaha-based provider of data center storage and managed technology services, has a new CEO, Brad Hokamp, center. With him at the Cosentry data center in Papillion are company founders Kevin Dohrmann, left, and Manny Quevedo.” Source of caption and photo: online version of the Omaha World-Herald article quoted and cited below.

Innovation through creative destruction brings us the new products and processes that make our lives longer, richer and more satisfying. The major downside of creative destruction is the job loss of those working for firms that are creatively destroyed. Sometimes, in class, I use Omaha’s Inacom as a concrete example. Inacom was a value-added retailer of computer equipment. They would buy PCs from IBM, Compaq and the like, then add software and hardware, and re-sell and install for firms, at a mark-up. They were creatively destroyed by Dell’s process innovation of customizing and selling direct, at much lower prices than Inacom charged. When I arrived in Omaha, Inacom was one of a handful of Fortune 500 firms. Now Inacom is gone. But just because a firm is creatively destroyed does not imply that all those who worked for the firm are creatively destroyed. Dohrmann and Quevedo were executives at Inacom. They had the skills, knowledge, resilience and work ethic to create their own entrepreneurial startup that has thrived. Not everyone can do what Dohrmann and Quevedo did. But everyone should be able to improve their skills, knowledge, resilience, and work ethic, so that if creative destruction destroys the firm that employs them, they will still survive and possibly thrive.

(p. 1D) Cosentry’s regional data center footprint has grown far from its “humble beginnings” 12 years ago of just 4,000 square feet in the old Southroads Mall in Bellevue.

“Everyone saw it as a mall that was in deterioration, and I walked in and saw the most beautiful building in Omaha,” co-founder Manny Quevedo said, (p. 3D) remembering solid walls and below-grade space for computer systems.
Investments from Omaha firms Waitt Co. and McCarthy Capital along the way helped the firm grow; it was sold in 2011 to Boston private equity firm TA Associates but still has its headquarters at 127th Street and West Dodge Road.
. . .
The company’s workforce has approximately doubled in the last five years to nearly 200, more than half of them in Nebraska, and will continue to grow gradually with the expansion as Cosentry hires more engineers and technicians, Quevedo said.
Today the company has six data centers, including two each in the Kansas City and Sioux Falls, S.D., metropolitan areas. If you use utilities or health care services or do any shopping or banking in the region, there’s a chance some of your information has been stored or processed through Cosentry’s servers.
Cosentry started with what Quevedo said was a handful of clients and grew to hundreds within its first five years.
. . .
(p. 3D) Cosentry Timeline
2001: With investment from Waitt Co., Cosentry is started by Manny Quevedo and Kevin Dohrmann, former employees of InaCom, the former Omaha Fortune 500 computer dealer that began as a division of Valmont Industries but merged with VanStar of Atlanta in 2000 and later declared bankruptcy. Cosentry creates a data center in Bellevue.
2005: Cosentry, also called IPR Inc., sold its IP Revolution division to a Kansas firm, Choice Solutions. IP Revolution sold voice and data communications services and systems. Cosentry doubles the size of its Bellevue data center and expands to the Kansas City and Sioux Falls, S.D., markets.
2008: Omaha investment firm McCarthy Capital invests in the firm. At the time, Cosentry had 95 employees.
2010: Cosentry cuts the ribbon on the $26 million Midlands Data Center in Papillion, a joint project with Alegent Health, which uses the center to store electronic medical records.
2011: Boston investment firm TA Associates buys Cosentry for an undisclosed amount from McCarthy and Waitt. The local management team continues to operate and have an ownership stake in Cosentry. The firm expands with second data centers in both the Sioux Falls and Kansas City markets.
2013: Cosentry refinances its credit facilities to provide up to $100 million to enable expansion, including the expansion of the Midlands Data Center. Today, Cosentry has nearly 200 employees and six data centers in three metropolitan areas.

For the full story, see:
Barbara Soderlin. “A Growing Tech Footprint: As Businesses’ Data Storage Needs Expand, Cosentry Adds to Its Papillion Center.” Omaha World-Herald (MONDAY, AUGUST 26, 2013): 1D & 3D.
(Note: ellipses added; bold in original print version of article.)
(Note: the online version of the article has the title “As Businesses’ Data Storage Needs Expand, Cosentry Adds to Its Papillion Center.”)

“Scott Capps of Cosentry’s Papillion data center with the cooling system that helped Cosentry earn an Energy Star certification, which is given by the Environmental Protection Agency based on energy efficiency and lower emissions. It’s the only data center in Nebraska with the certification.” Source of caption and photo: the archive online version of the Omaha World-Herald article quoted and cited above.

Former Economics of Entrepreneurship and Economics of Technology Student Luis López Voted Crowd Favorite at Straight Shot Startup Accelerator Demo Day

“Luis López pitches his startup, CardioSys, to investors during Demo Day at Aksarben Cinema this week. The event was the culmination of a 90-day Straight Shot startup accelerator program that offered new companies networking opportunities, advisers and investment dollars. Seven startups were in the inaugural accelerator class.” Source of caption and photo: online version of the Omaha World-Herald article quoted and cited below.

Luis López, the entrepreneur who is featured in the article quoted below, was a student of mine in both my Economics of Entrepreneurship and my Economics of Technology seminars (and before that, in micro principles). I cannot say that I taught him everything he knows, but it appears that I did not do him much harm.

(p. 1D) The same day Luis López and his brother, Danny, were accepted into Omaha’s Straight Shot startup accelerator for their new company, corporate America called.

The 25-year-old Central High grad had received a job offer from Gallup. But he turned it down, choosing to take an entrepreneurial risk over a predictable salary and benefits.
“I can always apply for a job in the corporate world,” he said, but it’s not every day that one’s company is accepted into an accelerator program that offers $20,000 in investment, more than 300 mentors and more than $75,000 in in-kind services.
The risk paid off, López said last week as the 90-day program wrapped up. The López brothers’ startup, CardioSys — which uses predictive analytics to calculate a person’s risk of developing conditions like heart disease and diabetes based on factors such as age, blood pressure and lipid profiles — came out of the program with a group of nine advisers.
. . .
(p. 2D) Luis López said CardioSys is hoping to land some investment in the next month or two, and is now looking at applying for a short-term health industry-focused incubator program in California, which the founders were connected with via Straight Shot.
In the long term, however, López said that with its strong community of medical and insurance providers, Omaha is CardioSys’ home. At Demo Day, the startup was voted crowd favorite. “I was surprised. It’s an honor to have people excited about what we’re doing,” he said.

For the full story, see:
Paige Yowell. “Straight Shot at Success; Accelerator’s First Startups Make Their Pitches.” Omaha World-Herald (SATURDAY, OCTOBER 5, 2013): 1D & 2D.
(Note: ellipses added.)
(Note: the online version of the story has the title “Straight Shot Accelerator’s First Startups Make Their Pitches.”)

“Luis Lopez, who with his brother Danny Lopez, created CardioSys, gives his pitch at Demo Day.” Source of caption and photo: online version of the Omaha World-Herald article quoted and cited above.

Early Funding for Ameritrade Was a Loan Secured by Joe Ricketts’ House and Car

(p. 1D) Even the oldest and most established companies were once a back-of-the-envelope glimmer of an idea.
That was the message Wednesday night from First National Bank’s Clark Lauritzen, president of the company’s FNN Wealth Management.
. . .
TD Ameritrade founder Joe Ricketts, Lauritzen said, started his company in 1975 with a First National loan secured by his car and house; the first office was in the bank’s basement. Now, the online stock brokerage employs 2,000 people in Omaha and is an industry leader.
“Joe reinvested his profits in the business year after year,” Lauritzen said.

For the full story, see:
Russell Hubbard. “Even Big Businesses Start Small, Says First National’s Clark Lauritzen:.” Omaha World-Herald (THURSDAY, AUGUST 29, 2013): 1D.
(Note: ellipsis added.)
(Note: the online version of he article has the title “First National’s Clark Lauritzen: Even Big Businesses Start Small.”)

If Terry Were from Texas, He Might Oppose Federal Ethanol Mandates

(p. 1A) WASHINGTON — The ethanol industry is again under fire from critics who want to eliminate the federal mandate that oil companies blend biofuels into the gasoline supply.
The House Energy and Commerce Committee is holding hearings on the Renewable Fuel Standard [RFS], which called for 15 billion gallons of biofuels to be used in 2012. The requirements reach 36 billion gallons by 2022.
. . .
(p. 2A) Rep. Lee Terry, R-Neb., a member of the Energy and Commerce Committee, said it’s clear that members from Texas and Louisiana will be targeting the usage requirements.
. . .
Terry has been a champion of the Keystone XL pipeline, making him an ally of Gulf Coast lawmakers and the oil industry on that issue.
Their split over the ethanol issue causes some awkward moments, he said.
“I say, ‘You do realize I’m from the Cornhusker State,'” Terry said. “If I was from Dallas, you know, who knows? I’d have a different view on the RFS.”

For the full story, see:
Joseph Morton. “Big Oil Revs Up Efforts to Repeal Rules Forcing Ethonal in the Mix.” Omaha World-Herald (MONDAY, JULY 8, 2013): 1A-2A.
(Note: ellipses and bracketed abbreviation added.)
(Note: the online version of the article has the title “RENEWABLE FUEL STANDARD; Ethanol Critics Rev Up Efforts to Repeal Biofuel Rules on Gas.”)

$30 Million First National Bank Regulatory Costs Due to Dodd-Frank Replacing Clear Rules with Regulator “Wild Card” Leeway

(p. 1D) The president of First National of Nebraska, the nation’s largest privately held banking firm, said new federal regulatory and compliance efforts stand to cost the company as much as $30 million this year.
“It is a big uncertainty in the banking world,” said Dan O’Neill, speaking Wednesday at the company’s annual meeting in Omaha. “They are not operating off of concrete rules. A lot of it is their interpretation.”
The federal Consumer Financial Protection Bureau was formed as a result of the federal Dodd-Frank laws passed in 2010 after widespread bank failures and bailouts using taxpayer money. . . .
. . .
The bureau, he said, worries banks because there is not a “clear body of rules” from which the regulator is operating in evaluating the fairness of a bank’s business practices. He said the agency’s regulators have a lot of leeway in deciding what to do af-(p. 2D)ter examining a bank; penalties for running afoul include fines.
“So it is a bit of a wild card,” he said.

For the full story, see:
Russell Hubbard. “First National Chief Says Regulatory Costs Mounting.” Omaha World-Herald (THURSDAY, JUNE 20, 2013): 1D-2D.
(Note: ellipses added.)

Federal Food Regs Drive Sharon Penner to Stop Baking for Nebraska Children

“Sharon Penner slices fresh bread, which she bakes a few times a week for Hampton, Neb., students. Penner, who has fed the town’s schoolchildren for 43 years, saw new school nutrition rules that cut many of her goodies as a sign it was time to retire. With her in the school kitchen is assistant Judy Hitzemann.” Source of caption and photo: online version of the Omaha World-Herald article quoted and cited below.

Have we gone too far when the preferences of Michelle Obama rule over the preferences of the parents of Hampton, Nebraska? And is it clear that the parents are wrong in thinking that fresh-baked bread (see photo above) and a timely pat on the shoulder (see photo below), are worth some extra calories?

(p. 1A) HAMPTON, Neb. — Blame the broccoli. Blame the mandarin oranges. Blame all their cousins, from apples to yams, for removing Mrs. Penner’s butter bars from the school lunch counter.

Then blame Mrs. Obama for removing Mrs. Penner.
So goes the thinking in this no-stoplight village of 423 people about 20 minutes northwest of York.
When the new federal school nutrition mandates went into effect this year, championed by first lady Michelle Obama, fresh-baked brownies, cookies and other sugary goodies disappeared from the school menu. And Sharon Penner, who has been feeding schoolchildren here for 43 years, decided it was a sign from above to retire.
Friday [May 17, 2013] will be the last school lunch the 70-year-old prepares for the Hampton Hawks.
Mrs. Penner is hanging up her apron.
“She is?” asked an incredulous sixth-grader named Treavar Pekar. (p. 2A) He stopped cold from scrubbing some of the six tables in the small cafeteria when I broke the news after lunch.
“NOOOOO!!!!!”
That about sums up the community response.

For the full story, see:
Grace, Erin. “Time to Hang Up Her Purple Apron.” Omaha World-Herald (FRIDAY, MAY 17, 2013): 1A-2A.
(Note: ellipses, and bracketed date, added.)
(Note: the online version of the article has the title “Grace: Hampton lunch lady ready to hang up apron.”)

“Sharon Penner with Bryce Joseph, who needed some help after dropping his breakfast tray.” Source of caption and photo: online version of the Omaha World-Herald article quoted and cited above.

Berkshire Agrees to Buy No More than 25% of DaVita, Firm Accused of Medicare Fraud

Warren Buffett’s Berkshire Hathaway has agreed to cap its ownership of DaVita Healthcare Partners at 25%. A previous entry on this blog quoted a story saying that Ted Weschler is behind Berkshire’s purchases of DaVita stock. An even earlier entry on this blog discussed accusations that DaVita Healthcare Partners has committed substantial healthcare fraud by charging the taxpayer millions of dollars for medicine that is needlessly thrown away.

(p. 2D) Berkshire agreed not to buy more than 25 percent of DaVita HealthCare Partners Inc., a national network of medical infusion clinics.
Berkshire investment manager Ted Weschler has been buying DaVita stock for Berkshire since joining the Omaha investment company last year, totaling about 14 percent of the company, Bloomberg reported.
Weschler and DaVita President Javier Rodriguez signed a “standstill agreement” last week, a document often intended to clarify whether an investor wants to acquire controlling interest in a business. Some have speculated that Berkshire wants to acquire all of DaVita’s stock, which artificially inflates the price of its shares.
DaVita legal officer Kim Rivera said Berkshire is a “supportive investor with a long-term view.”

For the full story, see:
Steve Jordon. “WARREN WATCH; At Berkshire meeting, See’s candymaker outshines Warren Buffett.” Omaha World-Herald (SUNDAY, MAY 12, 2013): 1D & 2D.

Berkshire Buys Big into DaVita, Firm Accused of Medicare Fraud

Warren Buffett’s Berkshire Hathaway apparently has a large stake in DaVita Healthcare Partners. An earlier entry on this blog discussed accusations that DaVita Healthcare Partners has committed substantial healthcare fraud by charging the taxpayer millions of dollars for medicine that is needlessly thrown away. Apparently the DaVita investment is due to Ted Weschler, one of two deputies to whom Buffett has delegated the investment of some of Berkshire’s funds.

(p. 3D) Weschler is believed to be behind Berkshire’s aggressive move into DaVita Healthcare Partners — a stock he owned when he ran his own hedge fund. Berkshire bought 10.9 million shares last year, becoming Da-Vita’s largest stakeholder with 15.7 percent of the company. DaVita provides kidney dialysis services and is seen as a consistent cash-flow generator. In November, the company closed its $4.7 billion purchase of Healthcare Partners, one of the country’s largest operators of medical groups and physician networks. DaVita shares rose more than 35 percent in the past 12 months.

For the full story, see:

MarketWatch . “Buffett was avid hunter of 6 stocks last year; Wells Fargo, GM and DirecTV top Berkshire’s list.” Omaha World-Herald (Tues., March 12, 2013): 1D & 3D.

Imagining Oscar Wilde’s 1882 Visit to Omaha

Source of image: http://images.amazon.com/images/P/1451617585.01.LZZZZZZZ.jpg

(p. 10) Hansen’s first collection, “Nebraska,” which appeared in 1989, was a work that in its wrought realism, its ways of culling grim beauty from the often harsh history of his native place, achieved a memorable intensity. “She Loves Me Not” republishes seven of those stories, but to suggest that he’s recycling would miss the larger point. Instead, he has used this early work as the basis for what becomes a very different, exploded, view of a place. In these pages, Nebraska — Omaha in particular — is both rendered and reappropriated, registered and riffed on through a range of tonalities.

The first story, “Wilde in Omaha,” is, as its title suggests, a playful reimagining of Oscar Wilde’s actual visit to that city in March of 1882. Recounted by a bumbling, fame-besotted journalist, the British writer’s short stay among the arts-avid, cornfed Nebraska bourgeoisie becomes a delightful anthology of some of this famed raconteur’s best bits. For Wilde will make no conversational response to any question that isn’t an epigram, as often as not a well-known one. Hansen’s setup lines can be almost groaningly obvious. When a Mr. Rosewater of The Daily Bee asks him, apropos of nothing, “Are you a hunter?” Wilde gets to deliver one of his celebrated bons mots: “Are you asking if I gallop after foxes in the shires? Indeed not. I consider that the unspeakable in pursuit of the uneatable.” Didn’t Monty Python run a similar shtick some years before? They did. But Hansen isn’t pretending otherwise.
“Wilde in Omaha” is followed by a string of stories from the “Nebraska” collection, and what a shift it is to go from that highly arch patter to the cruel horror of the blizzard of 1888 — a mere six years, but in terms of the circuit of human experience the very antipodes. “Wickedness” consists of a series of episodic encounters of farm people and townspeople with the completely unexpected — and unprecedented — storm. It’s mainly a catalog of last hours and final moments, but the detailing, the staging, is unsurpassed. Every moment is fully imagined. “A tin water pail rang in a skipping roll to the horse path.” A wife who has gone out to look for her husband is found “standing up in her muskrat coat and black bandanna, her scarf-wrapped hands tightly clenching the top strand of rabbit wire that was keeping her upright, her blue eyes still open but cloudily bottled by a half inch of ice, her jaw unhinged as though she’d died yelling out a name.”

For the full review, see:
SVEN BIRKERTS. “Odes to Omaha.” The New York Times Book Review (Sun., November 11, 2012): 10.
(Note: the online version of the review has the date November 9, 2012.)

“Under a Mountain in Omaha”

(p. 170) lnformatics had been run from the top down. Here’s a story typical of the way the company worked. They had a trainer at headquarters who was told to educate the troops at the Federal Systems Division in northern California, which was run by Geno Tolari, a tough-minded football player from Pittsburgh. When the trainer arrived and announced, “I’m here to train your people,” Geno shot back, “You can’t train my people.”
The trainer got haughty. After all, he was from headquarters. “I’m the education department. I train your people.”
But Geno insisted, “You can’t train my people because you don’t know what they do.”
So now the trainer asked, “Okay, what do they do?”
Geno answered, “I don’t know.”
The trainer thought Geno was joking with him, and insisted, “I’m the trainer; I need to know what they do.”
That’s when Geno confessed, “I can’t tell you because I don’t (p. 171) know. They’re under a mountain in Omaha, and it’s a military secret, and the Air Force won’t tell us what they do.”

Source:
Wyly, Sam. 1,000 Dollars and an Idea: Entrepreneur to Billionaire. New York: Newmarket Press, 2008.