Opportunity Calling: Making it in the Mobile Communications Industry
By Jim Schakenbach
After less than five minutes of conversation with Stephen Marcus, CEO of Marcus Communications, you realize he is out to win. Just twenty-three years old and an '02 WPI graduate, Marcus has a very clear vision of where he's taking his five million dollar company with its almost thirty employees.
Make no mistake, though -- Marcus is no business novice. Confident and articulate, he has the demeanor and maturity of someone twenty years older. Marcus started reading business books at the tender age of twelve and, at fourteen, rode his bike to downtown Vernon, Connecticut to start his first company, a computer consulting firm he named FutureNet. However, he quickly realized that FutureNet's business opportunities would be limited - no matter how hard he could try to grow the company, he could only ride his bike so far to meet with clients. Hampered by age and transportation, he realized success would have to wait.
As a WPI freshman, Marcus planned on using college as a way to "coast" while he figured out his next move. It came quicker than he expected when a chance encounter at a school career fair landed him a well-paying computer job at Tracer Research in Marlborough. Balancing work and school at the same time, Marcus thrived. However, by his sophomore year he became bored with work and began to seek new opportunities.
Opportunity comes calling
Marcus cites a class in his sophomore year as a critical juncture in his young business life. Visiting professor Brian McKenzie taught an influential small business management class which opened Marcus's eyes to the business world and gave him the opportunity to study how the best companies in America operate. This started the wheels rolling again.
"As part of the class requirements, I had to write a business plan," said Marcus during a recent interview. "I had been thinking about what to do next and realized that the cellular telephone business was only getting bigger. I discovered that I had a knack for picking tower locations and thought, 'hmmm, there's money to be made in cell tower real estate'."
There was one small drawback, though. Marcus knew nothing about the cellular tower industry. As luck would have it, the national tower convention was about to begin in Las Vegas so Marcus hopped on a plane and began an intense industry crash course, picking the brains of some of the country's most experienced and knowledgeable tower experts. Upon returning, he wrote a solid business plan that he was encouraged to develop.
A second opportunity came knocking when Marcus met influential Worcester businessman and WPI alumnus Julius Palley. "Julius had a profound influence on me," stated Marcus. "I came in as a dreamer and he said, 'hey, kid, here's the real world'."
Renting space from Palley at his 100 Grove Street building, Marcus launched into his next business venture, The Marcus Group, intending to build towers for the burgeoning cell telephone industry. With a $1 million line of credit based on potential leased tower real estate and the help of several other WPI students during the summer of 2000, Marcus began an ambitious program to build cell towers on a grand scale. "I found out that I was horrible at building towers," laughed Marcus. "We weren't going for one or two at a time, we were looking at a hundred towers - do you know how much money that is? You have to crawl before you walk."
To retrench, Marcus hired a former director at a national wireless carrier with more tower experience and moved the company to Manchester, Connecticut, where he shared space with his father's company, Marcus Communications, a 2-way radio system equipment and installation company. Struggling to make it work, Marcus was putting in 100-hour weeks, juggling school and work. "We began to do better, but just couldn't close enough lucrative deals to make it sustainable," stated Marcus.
So The Marcus Group slowly blended with Marcus Communications and turned to two-way networking, developing a communications network with the reliability of two-way radio and the ease of cell phone use. More cost-efficient and reliable in areas where cell coverage was poor, the new networking technology, called VoiceLink, was aimed at the consumer market, which was dominated in Connecticut by Nextel. The strategy was ill-conceived. With some two-way radio background from his father's company, Marcus "thought I knew ninety percent of what there was to know. I quickly learned I only knew ten percent."
Stung by the inability to make headway against their giant competitor, the company once again changed strategies and began to sell VoiceLink as a commercial and public safety network. It worked, and soon the company was landing larger contracts, installing systems for cable network ESPN, in the high-profile Foxwoods Casino, and at the Hartford Civic Center.
Rising to the top
But in January, 2001, fate once again intervened. Marcus' father, Bruce, underwent a quintuple bypass. As the elder Marcus devoted less and less time to work, his son, barely in his twenties, began to assume more and more responsibility. In August, 2001, Steve Marcus was named CEO of Marcus Communications.
Marcus knew he had a tough row to hoe. "My father was well-known as an innovator in the two-way radio industry," stated Marcus. "Those are tough coattails to ride." It didn't help that there was major age gap in the company. "Half the company was over fifty and the other half was under thirty," he added. "There was quite a culture clash."
To overcome this, Marcus and the younger staff had to earn the respect of the older employees. Eager to make their mark, the young employees dived into their work. Largely made up of WPI grads Marcus had hired, including Emmanuel Litos, '99, Chad Hart, '01 MBA, and Craig Daniels, '02, they learned the two-way business from the ground up, determined to make a mark for themselves and their company. Soon they were writing proposals for hundreds of thousands, even millions, of dollars. Their first big win came with a one million dollar contract from the Town of Windsor, Connecticut to design and install a public safety network linking all its emergency services.
"These guys wrote it all themselves," stated Marcus, referring to his WPI employees. "And you know what made it possible? It was the same process as writing an MQP at school. They went out and bought twenty-five books, learned the technology, did some studies, and wrote the proposal. It was everything they learned at WPI."
Nothing beats a good education
Marcus, who graduated in 2002 with a Management of Technology degree, credits WPI's Department of Management with helping him achieve success. "They gave me the tools I needed to be well-grounded and able to effectively manage technology and my business," he stated. Marcus also credits their success in large part to the solid background he and his WPI alumni-employees all received from the school. "A key factor was the flexibility of the curriculum at WPI," said Marcus. "For me, to be able to see all the technology going on was crucial."
Commenting on the school's entrepreneurial initiatives, Marcus encourages both students and alumni alike to take advantage of what the school has to offer, both in the undergraduate programs and in the Collaborative for Entrepreneurship & Innovation. "I've taken part in the entrepreneurial dinners and they're a great opportunity for students to ask questions and get advice from people who are out in the real world, making it happen," stated Marcus. And who better to ask than a kid hot out of school, with almost ten years and millions of dollars of business experience already under his belt.