Entrepreneur Recalls Development of Business
Lew Hoff '62 with his wife Hannah and daughter
Orly, who currently attends UMass Amherst
“Being successful involves working hard and luck,” says Lew Hoff ’62 (economics), president of Bartizan Connects, designer and producer of groundbreaking data collection devices for the credit card and exhibition industries, and executive chairman of Addressograph Bartizan, the world’s leading manufacturer of credit card imprinters. “Everyday you meet smart people who haven’t achieved success. But it’s rare to meet a success who hasn’t worked hard and been lucky.”
After graduation and then a four-year tour in the Air Force, Hoff landed a sales position with United Airlines in New York. The job turned out to be less about selling than meeting call quotas, so he began to look for something different. During an interview at CBS Hoff learned a valuable lesson: “The interviewer said, ‘All you’ve told me is why you don’t like your job and how much you’d like a new one. I’m not interested in what you want. I’m interested in what you can do for me.’ The interview came to a quick close—but my mindset was completely changed.”
Not long into his new job with American Management Association, a woman Hoff had worked with at United Air Lines suggested he meet her husband, the founder of ICV, Inc., a publicly traded company that had introduced point-of-sale devices to the retail market. Hoff became national sales manager. “It was a piece of luck,” he recalls, noting his entry into the credit card industry. “But where is it written that all of your luck has to be good?”
Half a year later ICV’s stock tumbled from $18 a share to well under a dollar. “It wasn’t long before Ed O’Reilly, the marketing manager, and I were informed that the company would be shutting down,” Hoff says. “That was mid-December 1970.”
O’Reilly and Hoff decided to form their own company, producing a low-cost plastic credit card imprinter. “We had a prototype, but the resulting product was riddled with tooling mistakes, rendering it totally useless. Nearly broke, we came into contact with Automatic Injection Molding and its owner Charlie Serretti. Where others had told us the job was hopeless, Charlie not only gave us hope, but also a reasonable price for the work. AIM made the tooling work. We didn’t have funds to produce more than 1,000 sets, but any less than 10,000 was deemed uneconomical. Charlie insisted that we go forward, allowing payment deferrals until we could afford to pay. His confidence was not misplaced.”
Still, times remained tight for Bartizan. To make ends meet Hoff and O’Reilly became waiters at O’Brien’s Tavern. “We were in a constant quest for funds. A friend of Ed’s sent us $9,200, no questions asked. We gave him a share of the business (17 years later he cashed in and retired). We applied for bank loans—we did get a $40,000 Small Business Administration guaranteed loan—and we borrowed from relatives and others—but by 1973 Ed and I owed roughly $100,000, about $800,000 by today’s standards. Tough to repay on waiter’s tips.”
O’Reilly, married by then with an infant, decided to opt out. He gave Hoff his share of the business—and his share of the debt. “No disrespect to Ed, but that was one of my luckiest business breaks. I probably would have thrown in the towel too if we’d broken even, but because of the debt’s enormity, I had no choice but to plow forward.”
For those too young to recall that time, credit cards did not have universal appeal. For example, when Hoff tried to sell imprinters in Switzerland, he was told, “There will never be a market for such a device here. For the Swiss, having a credit card would be an admission that we have no money.” Sales in the U.S. were slow in coming as well, but eventually—through networking—a small test order was clinched with Bankers Trust. After a design adjustment to create a metal base, the bank ordered 5,000 machines, more than Hoff had sold in the previous three years.
“Getting the order was one thing,” Hoff recalls. “Fulfilling it with the retrofitted bases was another. Mideast Aluminum, a big supplier of extruded aluminum, extended credit to us, probably on the recommendation of their sales rep, Arthur Schoen. Our production crew was an eclectic bunch, working out of a former stable on East 76th Street. The paid crew included an unemployed stockbroker, an underemployed actor, a New Zealand ex-pat, and several International Rescue Committee members. Among the unpaid volunteers were a bartender, an attorney, his girlfriend and my girlfriend.”
Things were looking up until Hoff received a letter in 1973 from Addressograph Multigraph Corporation, a Fortune 500 firm, telling Bartizan it had to pay $25,000 plus 8% of revenues to license Addressograph’s patent. “We probably couldn’t have scraped together $2,500. I got a patent attorney—the brother of the owner of O’Brien’s Tavern. We ended up in Judge Whitman Knapp’s courtroom—a bevy of representatives for Addressograph, my attorney and me. The contrast worked to our advantage, and in the end we formulated a cross-licensing agreement.”
By 1975 business was picking up. Bartizan moved out of the stable to a third floor loft in Long Island City. Accounts were established with New Zealand and Australia. “I was handling marketing, sales, daily bookkeeping, correspondence, janitorial service. I needed a part-time secretary.” Hoff hired graduate student Elizabeth Mazei for $7.00 an hour. Not long after, she became an inside sales rep, and when her studies took her to France, she started calling on prospective clients in Europe. Today Mazei is executive vice president.
With a thriving business, Hoff relocated again in the late 1970s to Yonkers, and a few years after that to the present quarters. “Our imprinter business peaked in 1991. We had been extremely profitable for a decade, but the introduction of electronic point-of-sale devices imperiled our business. And our biggest customers—commercial banks—skillfully played one competitor against the other, to the point that the three remaining imprinter manufacturers had to be concerned about their survival.”
Bartizan needed another product line. Hoff found it at a Chicago trade show: a shoebox-sized magnetic stripe reader—a small computer and a fanfold printer—used by trade show exhibitors to record information encoded on badges worn by attendees. “I was intrigued,” Hoff recalls. “I envisioned a small one-piece device that contained the same technology. All I needed was a designer who could make it work.”
Four and a half years later, in 1996, Bartizan shipped its first tradeshow lead retrieval terminals. The Expo! was an immediate hit, but Hoff essentially knew no one in the tradeshow industry. Flipping through an industry magazine, he saw a column by Bob Dallmeyer. “I stared at his photo,” Hoff recalls. “He sure looked like my old fraternity brother from UMass Amherst. I contacted him, and he was! In the intervening years Bob (’59, sociology) has been my muse, having introduced me to dozens of the leading lights in the tradeshow industry.”
By the late 1990s, the imprinter business merged with National Business Systems, a publicly held Canadian firm. But when NBS decided to sell, Bartizan was the buyer. In 2001 Addressograph Bartizan was formed. The new company has thrived, with customers in more than 80 countries and operations in Canada, the U.S., the UK and China. Meanwhile, Bartizan Connects, that develops and produces hardware and software for the events industry, is coming off its most successful year yet.
Life is good for hard-working and lucky Hoff, who has reconnected with his alma mater after 45 years. His daughter Orly, after visiting 14 campuses, chose to attend UMass Amherst this past fall. “Orly is having a wonderful time—I am impressed with how ambitious she is.”
Hoff isn’t just observing his daughter from the sidelines. He has joined the Dean’s Advisory Board, working to raise the visibility of the College of Social and Behavioral Sciences with alumni in particular. Also, he and his wife Hannah are charter members of the newly created UMass Amherst Parent and Family Council, connecting with donors and helping to plan and staff Family Weekend in April. Hoff is also engaged with the Employer Networking Night run by Career Services.
“My experience at UMass Amherst gave me leadership opportunities,” Hoff says. “It’s a wonderful school in a wonderful setting. I admit that my life was very unbalanced, particularly between the ages of 30 and 50. It consisted primarily of work, not uncommon among entrepreneurs, but I continue to be passionate about it and am having too much fun to retire.”
January 15, 2008