With its new convention center, major league sports teams, Independence Hall and Liberty Bell, cheesesteaks and Tastykakes, world-renowned symphony, ballet and art museum, and The Wharton School, what else could Philadelphia possibly have to boast about? Answer: That the city and its environs are home to more than 11,000 Wharton alumni (second only to New York City in that respect), many of whom hold leadership positions in private, non-profit and government organizations. On the following pages we interview a random selection of graduates. Consider using their recommendations on area hotels and restaurants to help you plan a visit to Philadelphia, and Wharton.
Winning a football scholarship to Rutgers University and heading up the largest publicly-held infomercial company in the world might seem two unrelated events. But in Mark Hershhorn’s mind, they connect.
“I have always wanted to build a business based on the same team skills used by successful football players,” notes Hershhorn. “That means no superstars, because superstars by themselves can’t win games.”
Hershhorn has met his goal on both fronts. National Media has grown from $176 million in sales to $293 million during his two years as president and CEO. Hershhorn is a key part of a lean management team of four individuals — collectively called “the Office of the Chairman” — that includes himself, a chairman of the board, an executive vice president who is president and CEO of the international business, and a vice chairman who is the senior legal, financial and M&A representative.
“We each have functional responsibility for parts of the business, but we communicate on a regular basis and any one of us can fully represent the company at any given time,” says Hershhorn. “Our next level is the executive committee, which has nine people. Below that is another eight to ten managers. So there are 20-plus senior level people empowered to drive and build the organization. We have the ability to truly function as a global business and to respond quickly to new opportunities.”
Today National Media is in more than 270 million homes with television sets in 60 countries. Its Ab Roller Plus (to strengthen abdominal muscles) is the top-selling product on TV in America. Other big infomercial sellers include the Royal Diamond cookware set, the Ionic Toothbrush and an automotive product called Motor-Up.
With about 800 million homes around the world owning TV sets, Hershhorn sees big potential for growth. “We are already the major player in North America, Western Europe, Japan, Australia, New Zealand, the Philippines, Malaysia, Indonesia and Singapore,” he says. “We are initiating operations in South America and getting ready to expand into South Africa, China and India. Our goal is to be in half a billion homes by the year 2000.”
The biggest obstacles to expansion include overcoming regulatory hurdles in particular markets and setting up fulfillment, customer service, product delivery systems and other infrastructure that must be either built or acquired. “It’s a different set of challenges in each country,” notes Hershhorn.
Challenges, he’s used to. His post-Wharton career started with two years at Price Waterhouse; five years at Pfizer, Inc. where he ended up as comptroller of the pharmaceutical company’s worldwide diagnostic business; and eight years at a toiletry company called Carter-Wallace, Inc. where he was part of a team of four that rebuilt the company’s health care group “from the bottom up.”
In 1985 Hershhorn joined the Franklin Mint as CFO and chief of staff, one of 10 new executives brought in to help run the company. During his five-year tenure there, the business grew from $200 million in sales to $600 million.
He left in 1990 for the opportunity to turn around — and eventually buy — J. Crew. The turnaround was completed but by then the days of successful LBOs were gone and Hershhorn wasn’t able to finance the purchase. He worked at Nutri/Systems, Inc. for the next 18 months and then joined National Media in 1991.
He recruited a number of teammates from the Franklin Mint to start building a new management team. In March 1993, he was fired by the chairman and CEO “after prolonged disagreement over the direction of the company,” Hershhorn says. “My team was stuck there. I spent the next several months as part of a group trying to purchase the company.”
It turned out not to be necessary. In 1994 the chairman and CEO was forced by the board to resign, and Hershhorn was brought back in to help rebuild the company.
“In today’s modern global corporation, it’s very difficult to be in more than one place at a time,” says Hershhorn. “My philosophy is to create an organization with the appropriate functional skills where people work together, trust each other, don’t worry about turf and understand the common goal.”
Most of the “customers” that go through Leadership, Inc., says Elizabeth Dow, “are high-level executives around the age of 40 who are on the fast track, secure in their jobs and finally have time to exhale a little and think about what is missing from their lives.”
What Dow hopes they find missing is a commitment to put their talent to work on behalf of the community. Leadership, Inc. is a 37-year-old non-profit organization that offers extensive training in both leadership skills and civic issues, with the ultimate goal of placing its graduates on the boards of nonprofit organizations in and around Philadelphia.
Leadership, Inc.’s core program accepts 60 professionals into 10 day-long seminars throughout the year that include meetings with leaders in the business/non-profit community, an intense leadership development program and training in board skills and responsibilities. Graduates of the program, which costs $3,000, are placed on boards, frequently one which matches their particular interest. “A former football player might want to get involved with the Philadelphia Eagles’ charitable foundation; a venture capitalist might be interested in a technology-oriented board; someone else might be interested in working with an AIDS foundation,” says Dow, who places about 100 people a year on boards. “The important thing is that they know why they want to get involved in community service.”
Leadership, Inc., also does private programs for specific groups, including this year, the Young Presidents Organization. “That’s been a very exciting experience,” says Dow. YPO Members “are just as passionate about community service as they are about their businesses, which makes them very easy to place on boards.”
For senior corporate executives who are new to the area, Leadership, Inc. offers a six-session seminar dinner series that helps “weave them into the fabric of the community, whether they need help finding a business partner, a school for their children or an overview of the region’s economic, political and civic structure,” says Dow.
Leadership, Inc. currently has about 1,800 alumni — including 58 graduates of Wharton — in leadership positions.
Dow herself is an alumna of the program, which she attended while working at Coopers & Lybrand 10 years ago. Before that she had been a management analyst in the Carter White House and a principal at The Hay Group. She joined First USA Bank in Wilmington as a senior vice president, human resources, before coming to Leadership, Inc. in 1993.
“The organization was basically going under. They were looking for someone with a great passion for Philadelphia who understood how to run a business,” says Dow, who has a BA from the University of Minnesota and an MA from Cornell and is married to Wharton alumnus Scott McQuilkin, also WG’80.
Today Leadership, Inc. has a lean staff of four. “Clients want top-drawer development experiences,” notes Dow. “We have to perform to their standards with limited resources.”
It has been an exhilarating ride so far for Josh Kopelman, whose summer internship back in 1991 sparked the founding of Infonautics, a publicly-held information services company based in Wayne, Pa.
Just before his junior year at Wharton, Kopelman worked at Telebase Systems in Wayne, owner of the I-Quest business information service on Compuserve. He and his summer boss, Marvin Weinberger, noticed that usage of the service would spike up late at night in May and December indicating, they felt, that kids were using the service to do their homework, write research papers and study for final exams.
“We put together a business plan for a product called Homework Helper, which would be a kids-based information and general reference service.” Telebase Systems passed on the idea so Weinberger and Kopelman decided to do it on their own. “Marvin remortgaged his house. I couldn’t exactly mortgage my dorm room, but I borrowed some money and in 1992 we set up an office in Wayne.”
Today the company has more than 100 employees. “During the past two years we have raised about $20 million in venture capital,“ says Kopelman, who grew up on Long Island and graduated from Great Neck North High School. “In our latest round we had strategic investors come in, including Comcast, Gannett, McGraw Hill and others. We went public in May, selling 2.25 million shares at $14 a share and raising $28.5 million.”
Second-quarter revenues were $430,000 on losses of $2.6 million. “Analysts’ expectations are that Infonautics will earn about $2.8 million this year,” says Kopelman, adding that the company currently has more than 20,000 paying subscribers to its different on-line services.
Infonautics launched Homework Helper on Prodigy in 1995, and that same year won Popular Science’s “Best of What’s New” award. They recently launched a second product called The Electric Library which “tries to bring the power of your public library to any user on the internet. A user at our site — www.elibrary.com — can type in a plain English question, like who is the oldest person in the world, and our database of more than 800 magazines, 150 newspapers, books, and encyclopedias, brings back the answers.”
Kopelman’s background, “if you can call it that,” he says, “is in management and marketing, so all the programming has been done by other employees.
“The industry we are in is very young,” adds Kopelman who is 25 (although Weinberger is 42). “We joke that my age is what makes this an Internet company. But it’s true to some degree. The market is evolving so quickly that there are no footprints in the snow. You start with a blank slate … I hire people I can learn from and we partner with people who have new opportunities for us…
“The Internet has made it easy to access a lot of information but hasn’t made it easy to find answers. That’s what we are trying to do.”
Real estate developer David Marshall is a man who feels passionately about many things, including cities.
Such as Philadelphia, where he has labored for years on initiatives to improve the downtown sector in particular, and the health of urban centers in general. “We can’t abandon our cities,” he states. “If our federal government doesn’t want to support them, let’s figure out a way to share the responsibility.”
One could say that David Marshall — who sits on 11 boards in Philadelphia, including the Police Athletic League, the Fox Chase Cancer Center and The Curtis Institute of Music — has already done his part. As owner of the Rittenhouse Hotel in Philadelphia’s Rittenhouse Square, he chaired Concerned Citizens for Center City, a group of businessmen, retailers, real estate brokers and residents who met weekly with the mayor, police commissioner, district attorney, fire commissioner and anyone else who could help protect Philadelphia’s most upscale residential and commercial shopping area. “We brought them all together and said this is what we need,” Marshall says. “We got things going.”
It was the type of entrepreneurial enterprise that has characterized Marshall’s entire career. As an undergraduate at Wharton, for example, he paid his tuition by running a mortgage company on the side. After two years in the U.S. Army, he signed on as a trainee in the income loan department at Colonial Mortgage Service Company, which in 1968 was bought by Philadelphia National Bank. By 1970, in addition to running the bank’s income loan department, Marshall had started a real estate trust. “In the early 1970s there were about 200 of those, 190 of which went broke. We made money because we did only quality deals and we didn’t do a lot of heavy leverage.”
The strategy paid off for Marshall and it also attracted the attention of the Bass family in Texas. In 1976 Marshall joined them to head up a nationwide real estate company based in Philadelphia. “We purchased about $2 billion dollars of real estate over the next 12 years in projects that included Pier 39 in San Francisco, a golf course development with Jack Nicklaus in Scottsdale, Ariz., the Dorchester Apartments in Philadelphia and Denver Place, a 2.5 million square-foot mixed-use complex in Denver, Colo.”
In 1987, Marshall purchased the real estate company from the Basses and renamed it Amerimar. Today the company has about $2 billion in assets and 50 properties, including hotels, office buildings and apartment buildings across the U.S. Although Marshall is the sole shareholder, all his deals are owned by partnerships which include the Amerimar officers.
In Philadelphia, Marshall is perhaps best known as the rescuer of the now elegant Rittenhouse Hotel and Condominium Residence. Marshall bought the half-built and abandoned building in 1987 for $19 million, renovated it and reopened it in 1990 to rave reviews. He is proud of the hotel’s 294-person staff. “Last year 150 of our employees received five-year pins,” he says. “In this business, that kind of longevity is unusual.”
The letters in SEI Corp. stand for Simulated Environments, Inc., a phrase coined several decades ago by Al West to describe his new company’s first product — a training system that used computer simulation to teach bank employees the fundamentals of lending money.
That was in 1968. Today, although the original name remains substantially the same, the company has moved far beyond its original mission. With 1995 revenues of $226 million and a workforce of 1,100, SEI Corp. has expanded into global asset management as well as investment systems and services, and recently has set its sights on global investing in Latin America and South Africa, among other locales.
SEI’s global asset management unit was formed in 1995 to target pension plans and high-net-worth clients interested in investing outside their countries and regions. The company is seeking local strategic alliances throughout the world to aid in its expansion.
In South Africa, for example, SEI has established a partnership with a local brokerage firm to facilitate a move into global investing. SEI is providing both offshore and onshore funding through an office in Argentina, with plans for further expansion into Brazil and Chile. In Taiwan, SEI has set up a joint venture for a new mutual fund company.
“We are looking abroad in order to diversify our client base. Also, that gives us a tremendous opportunity to secure asset management business in some of these markets,” notes West, citing, for example, the reform and/or privatization of pension systems underway in a number of countries. SEI also plans to develop international trade expertise.
A relatively new area of interest for the company is the family business. SEI has recently become a lead partner in Wharton’s Family Controlled Corporation Program. Notes West: “The dominant form of commercial organization worldwide is the family business … The partnership with Wharton will enable us to learn the intricacies of family businesses globally so that our services can be designed to better meet their unique needs.”
Simultaneously, SEI’s investment systems and services business — which provides software, processing services, general expertise and back-office support to financial institutions — is thriving. With 40 percent market share, the company is an industry leader in the delivery of systems that handle investment accounting for bank trust departments.
SEI also provides marketing and administrative services for more than $71 billion in mutual fund assets, including $25 billion of its own funds. Its liquidity management group manages the short-term assets of corporations and financial institutions.
West, who earned his B.S. in aerospace engineering from the Georgia Institute of Technology, hatched the idea for SEI in 1968 when he was a doctoral student at Wharton. He used computer simulation as a training aid to help students run an imaginary company. “Several directors on the board of the fictitious company were bankers and they asked me to create computer simulation programs for them,” West says. He agreed, and the company took off, expanding into banks’ trust departments during the 1970s and growing at a rate of more than 50 percent a year.
In 1990, West established the SEI Center for Advanced Studies in Management at Wharton. “I had broken my leg skiing and decided while I was laid up that there were some things I wanted to change within the company. I went to Wharton and we established the Center to research the kinds of issues that come with reinventing a company and ensuring that one has the right foundations in place.”
Ask Jay Snider, founder and chairman of a $60 million, 3,000-employee full-service security company, what he enjoys most about running a business and he answers: “Coming up with new ideas.”
Most recently, that has meant the creation of a new, patent-pending emergency response software program to provide 911 public safety officials with medical and other critical information on individuals in need of assistance. The company, called Life Safety Solutions, Inc., expects to roll out the system, known as 911Plus, later this year.
Snider’s nose for opportunity started during high school when he worked as an usher and security guard at Philadelphia’s Spectrum arena, one of several businesses owned by Jay’s father, Ed Snider, an entrepreneur who also owned the Philadelphia Flyers. “While I was there I realized that no one else in the city was specializing in event security,” says Snider. “Three months after graduating from Wharton, a partner and I started SpectaGuard.” Initially the company provided security personnel for the Spectrum, rock concerts, the Philadelphia Eagles, the University of Pennsylvania and the U.S. Open golf tournament, among other clients.
It wasn’t long before Snider realized that more money was to be made in industrial security — i.e., providing uniformed, 24-hour security guards for office buildings, shopping malls, hospitals, museums, parking garages and corporate complexes. Today industrial security accounts for 100 percent of SpectaGuard’s business.
In 1983, Snider was named president of the Philadelphia Flyers hockey team and in 1987 became president of Spectacor, Ed Snider’s multi-million dollar sports, entertainment, retail sales and communications company. During his tenure as Flyers president, Jay Snider helped pioneer the concept of all-talk sports radio by buying WIP-AM, a floundering music station, and turning it into the most successful sports talk station in the country.
In 1989 Snider’s job was expanded to include head of development for the $200 million Spectrum 2, which opened in August and has since been renamed The CoreStates Center.
In 1993, Snider returned to SpectaGuard. “Today we are an integrated asset protection company,” he says. “Instead of trying to sell our customers the most number of guard hours per week, our focus is to provide the customer with the most efficient deployment of manpower and electronic resources, which is most likely some combination of security guards, card access systems and alarm systems.
“Also we are deploying our own wide-area network at all our client sites, so that we can not only input scheduling and payroll information but can generate billing information and offer computer training programs and e-mail on site as well.”
Although cable giant Comcast Corp. recently purchased the Flyers, the ‘76ers basketball team and the two Spectrums, Jay and Ed Snider and two other partners still retain 34 percent ownership.
Snider leaves SpectaGuard’s marketing and operations management to his two partners, preferring instead to focus on long-range strategic planning. “My job,” Snider notes, “is to look at the big picture.”
Doctors in Philadelphia, says Evelyn Eskin, “are very sophisticated at what they do. They have to be, because this is a very sophisticated medical marketplace. But doctors have not been trained to be business people and they don’t like change.”
Which is where Eskin and her consulting company first entered the picture. HealthPower Associates was founded in 1987 to provide educational and practice management services to physicians, hospitals and academic health centers. Over the years, the company’s mission has expanded into delivery of management and planning services to all types of health care providers. The client list has grown to include hospitals, HMOs, medical associations, software vendors, professional and specialty societies and law and accounting firms.
For example, “a hospital system will buy up physician practices and realize they don’t really know how to run them. We can help with all the non-clinical aspects of managing a practice,” says Eskin. “Or a third-party payer will contact us because they realize they must understand how to manage physician groups … Or a small group practice that is about to negotiate a contract with a big HMO will seek our advice. We also help with mergers — either among solo practices or between two larger groups.”
Doctors, Eskin says, “are individuals who like to be in control. They do not take well to working in groups. Yet now they have to deal with hospitals, insurers, HMOs and so forth. The doctors will tell you it’s the HMOs who have come between them and the patient, but it’s really the hospitals who are defining the health care systems and leading the health care revolution in this city. That’s not necessarily true in other parts of the country.”
HealthPower’s practice management projects range from strategic planning, operational assessments and evaluation of managed care contracts to recruitment and training of office staff, chart audits and selecting practice management systems and technologies.
The company, which has five professionals and 23 clients, also offers educational services, including classes, seminars and workshops.
After earning her MBA from Wharton, Eskin, who graduated Phi Beta Kappa from Cornell with a degree in economics, spent seven years as director of the Hahnemann University Physician Assistant Program followed by one-and-a-half years as director of administrative services with the department of obstetrics and gynecology at Penn. “That’s when I decided there was a real future in physician practice management,” she says. “One of my jobs was to run the practices. Not only did I not know anything about it but there weren’t any resources I could go to for help.”
The Wharton connection has been “invaluable” to the success of her company, Eskin says. “I have been in business now for nine years, and because of my Wharton contacts, I can put my fingers on the right people in almost any aspect of health care.”