By Julie Tatge
David Wilhelm is strolling the floors of Ed Map, one of the business success stories funded by a venture capital firm he launched in 2002 to bring jobs and opportunities to central Appalachia. Thanks to the backing of Adena Ventures, Ed Map is thriving. On a recent weekday morning, workers at the company’s Nelsonville, Ohio, warehouse are sorting and packing chunky textbooks and paperbacks into boxes, capitalizing on the growth of distance-learning programs.
Not that long ago, Ed Map fulfilled 5,200 orders in a single day, shattering an earlier company record. Employment stands at 100, up from a handful in 2002. "Got the economy turned around yet?’’ an employee teases Wilhelm as he stops to say hello. "We’re working on it,’’ Wilhelm banters back. In the shipping area, he pauses to take in the view. "It feels good,’’ he says of Ed Map’s growth. "This is what it’s all about.’’
Recently honored as Ohio University’s Alumnus of the Year, Wilhelm (BA ’77) never set out to be a moneyman. Raised in Athens, Ohio, he gravitated early to the world of campaign politics, managing everything from his high school teacher’s run for Athens City Council to Bill Clinton’s bid for the White House. In 1993, he became the youngest-ever chair of the Democratic National Committee.
Lately, however, Wilhelm has been focused on economic development. How to create jobs. How to promote sustainable growth. How to help an impoverished region that has been exploited for its rich natural resources build a better future. Big questions, to be sure. But to Appalachia’s and Ohio University’s good fortune, some of the most consistent words that friends and colleagues use to describe Wilhelm are: smart, optimistic, idealistic and, most importantly, loyal.
"David has an incredible sense of home,’’ says Evan Blumer, executive director of the The Wilds, a nonprofit conservation center located on nearly 10,000 acres of reclaimed mine land in Southeast Ohio. "He wants to bring all of the social and political currency he owns and put that to use for the good.’’
"His fingerprints are on a lot of really good things,’’ says Cara Dingus Brook, AB ’02 and MPA ’06, chief executive of the Foundation for Appalachian Ohio. "He’s used Adena Ventures and other opportunities he’s had in life to create opportunities for others.’’
An exceptional venture
After his high-profile political work, Wilhelm could easily have landed a lucrative job with a D.C. lobbying firm eager to make use of his extensive network, notes Tom Vilsack, U.S. secretary of agriculture and a longtime friend. But Wilhelm elected to come back to his home state, helping those "who don’t have a voice, who might otherwise be ignored.’’
For struggling regions such as Appalachia, venture capital funds like Adena can play an important role in economic development by helping small businesses get started and expand, he adds. "Small business is often at the center of a community’s renaissance and rebirth,’’ Vilsack says.
Wilhelm’s first steps into venture capital started with a telephone call in 1998 from the Rev. Jesse Jackson, who told him that he had been invited to speak at Wilhelm’s alma mater. Wilhelm urged Jackson to spend some time in the area, and the civil rights leader ended up hosting an economic roundtable in Nelsonville.
The roundtable, Wilhelm recalls, drew a crowd of respectful folks who shared their aspirations as well as their frustration at how difficult it was to find money for emerging businesses. Their stories hit home with Wilhelm.
"That’s the day I became a venture capitalist,’’ Wilhelm recalls. "I didn’t want to lose the energy in that room. Knowing virtually nothing about venture capital, I announced that we were going to create a $15 million venture capital fund.’’
For some perspective on Wilhelm’s vow, consider this: In the U.S., venture capital hotspots traditionally have been located on the coasts, places like Silicon Valley, San Francisco and Boston, spots where investors hope to get in early on the next Google or Apple Computer. Startups in the nation’s heartland, by comparison, often are ignored.
Betting that high-growth businesses that deliver solid returns could be developed in the country’s flyover zones, Wilhelm founded Woodland Venture Management, a fund-development firm. He also recruited Lynn Gellermann as a partner and president of Adena, Woodland’s first fund. Early Adena investors included Ohio University.
By the time Adena opened in 2002, the partners had raised $34 million from other big- name investors and expanded the fund’s target area beyond Ohio to West Virginia, Maryland and Kentucky. A former Banc One executive, Gellermann estimates that Adena has helped create or maintain about 750 jobs in the region.
Woodland later launched a second fund, Hopewell Ventures, which is based in Chicago and focuses on the Midwest. "We are taking advantage of a market inefficiency and playing a leadership role,’’ Wilhelm says. "I definitely started out wanting to do good things for the part of the country I grew up in, but it has turned out to be a pretty good business proposition, too.’’
He predicts that his investors will earn returns that will be competitive with, or better than, those produced by other early stage venture funds started around the same time as Adena and Hopewell. In addition to providing equity capital, Adena offers operational assistance to developing companies, teaching managers, for example, how to find executive talent or devise a marketing plan.
To do so, Adena partners with private sector firms as well as universities, including Ohio University’s George V. Voinovich School of Leadership and Public Affairs. It’s a winning formula for the university’s MBA students, who get the chance to do hands-on consulting work on real business problems, says school Director Mark Weinberg. This year, Wilhelm is serving as a visiting professor of leadership and public affairs at the school, leading seminars and lectures as well as mentoring students.
Love for the land
The son of a refugee from postwar Germany, Wilhelm was born in 1956 in Champaign, Ill. When he was 7, his family moved to Athens, joining the Ohio University community. His father, a geography professor, focused on the settlement of Appalachian Ohio.
Wilhelm often accompanied his father on research trips, learning about the area from customs and simple icons such as a wood barn. "I think from him I got a love for the land as well as a recognition that — with his immigrant’s sensibility — life wasn’t easy for everyone,’’ Wilhelm says. "Not everyone had the same chances."
Today, Wilhelm remains active in politics and served as an adviser to Ted Strickland when Strickland successfully ran for Ohio governor in 2006. Nationally, he made news early last year by supporting Barack Obama’s push for the Democratic nomination, and he became one of his leading surrogates.
But increasingly, he is focused on the business at hand. Adena is eight years into a projected 10-year investment cycle. A second iteration is expected to follow, most likely expanding into western Pennsylvania and upstate New York.
He gets a charge, he says, from hearing about local work to promote sustainable farming, renewable energy, and new efforts by Ohio University’s Voinovich School and the College of Business to train students in entrepreneurship and support emerging businesses.
Such projects, he says, represent a big shift in how economic development is being pursued. Not all that long ago, communities focused primarily on landing a big employer from outside the region. But that strategy sometimes backfired. As Appalachia’s own history shows, the wealth created by those companies wasn’t always shared with the region’s people.
Building from the ground up, by comparison, can provide a model for how other nonurban communities can push the reset button and create stronger, more inclusive, futures, he says. It also reflects an internal belief in the area’s capabilities and talents.
"I get the sense that this area is primed to move out of the recession with more confidence than other areas. We’re used to hard times,’’ Wilhelm says. "Some of this good work that we’re doing, I think it’s going to pay off.’’
Third Sun: Alumni
find success in solar
With the help of Ohio University and TechGROWTH Ohio, alumni Michelle and Geoff Greenfield (both MAIA ’94) have transformed Third Sun from a mom-and-pop shop to the 32nd-fastest-growing energy company in the nation, according to an August ranking by Inc. 5000 magazine. With a three-year growth of 390 percent, Third Sun has become the Midwest’s leading provider of solar energy systems.
You’re originally from larger cities. (Michelle is from Cincinnati, and Geoff is from Syracuse, N.Y.) Why did you stay in Southeast Ohio?
We graduated (from Ohio University) in 1994, and a lot of our peers were moving to Washington, D.C., but we liked it here. We both ended up finding work here in Athens doing economic development. After a year or so, we decided to purchase some land in the country, build a house and stay. Up to that point, we had been traveling a lot, and we were sort of settling in and making friends. We didn’t want to pick up and go away.
How did the two of you meet?
At Miami University … but I don’t know if you are allowed to print that! We both came to Ohio University for grad school.
What has it been like to watch your business grow from a mom-and-pop shop to a midsize business?
It is sometimes unbelievable. When we first moved into the Innovation Center (Ohio University’s business incubator), we rented the smallest possible office. We now occupy the warehouse here and eight additional offices. It’s been really exciting.
What are the business advantages of living in this region?
A low cost of living. That has enabled us to take the risk of starting a business on a bootstrap budget. We also have a great work force here. (Third Sun has 21 employees.) They are motivated by more than just the job; they are motivated by the mission. There is a lot of help here with the university, too. We have a lot of great connections.
You are one of the clients working with TechGROWTH Ohio (learn more). How has that partnership helped?
The biggest help has come from an adviser working with us one-on-one. He knows our business really well. Getting that expert business perspective has been really valuable.
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