One day last August, Brad Anderson, a senior vice president of huge Dell Computer, called CEO Phil Soran of Compellent, a fast-growing, Eden Prairie-based provider of low-cost, flexible data storage systems. That was the first contact in a several-months dating game that culminated last week in a corporate marriage that meant an $800 million dowry for Compellent shareholders.
The acquisition is Texas-based Dell's latest bid to expand beyond its legacy as a maker of personal computers and servers, and expand as a provider of sophisticated storage solutions. In addition to Compellent, Dell recently acquired EqualLogic of Nashua, N.H. Both are smaller, entrepreneurial companies focused on providing data-storage that can be automated and tiered to permit less-used information to be automatically stored on lower-cost, slower disks.
Compellent's system is designed to save expensive storage and energy costs, and some customers have reported annual savings of one-third or more.
The $27.50-per-share acquisition of Compellent, double its price earlier in 2010, is a tribute to Soran and his technologists who have built two significant data-storage firms in Minnesota over the past 20 years.
Soran, 54, the son of a teacher, also started out as a junior high math teacher in his native Colorado in the 1970s. He left teaching to make a better living in sales for IBM. And he left IBM to become an entrepreneur in 1992.
He has emerged as one of Minnesota's most successful technology entrepreneurs, said Dan Carr, CEO of the Collaborative, a membership organization that brings together entrepreneurs and financiers.
Soran and Compellent co-founders Larry Aszmann and John Guider, who are computer scientists, also started Xiotech. They sold it in 1999, at the top of the technology boom, for nearly $400 million. Xiotech, which the founders left not long after the sale, is a competitor that has struggled and recently moved to Colorado.
Soran, a guy who likes to praise Minnesota for its well-educated workforce and good business climate, has done very well here. He, Aszmann and Guider grossed nearly $90 million together on the sale of their stock, before deducting their cost, in the cash sale to Dell.
Compellent employees made a few thousand to several millions on last week's transaction, depending upon when they joined the company.
In an interview last week, Soran said this is just the beginning of Compellent's success in Minnesota, even though the history of mergers indicates the smaller party often can get overshadowed -- if not trampled -- by the acquiring giant.
For example, big Tyco Electronics, which acquired ADC Telecommunications of Eden Prairie in 2010, plans to cut 248 of the 700 ADC employees at the former ADC manufacturing plant in Shakopee and move the jobs to lower-wage New Mexico and Mexico.
Soran expects to remain indefinitely as president of what will be called "Dell Compellent" and grow the unit. He has told associates that Compellent could hire another 300 people this year to meet expansion plans, although he declined to be pinned down.
"We have aggressive goals," Soran said. "This is a good deal for our employees, shareholders and growth in this community. That doesn't always happen in mergers. We want to keep Compellent intact. Over time, that may change....
"Compellent ... has changed the data-storage landscape from Eden Prairie, Minn. And Dell goes from being largely a reseller of technology to a provider of Dell-exclusive technology."
Compellent and EqualLogic -- two of the most talked-about storage makers of the past decade -- are now the heart of huge Dell's storage strategy.
Soran said the Dell relationship already has opened doors for Compellent in South Africa, Brazil, Panama and elsewhere in Latin America.
"They have a worldwide presence and breadth of distribution," Soran said. "They give us more credibility. For a lot of our accounts, Dell already was a strategic supplier of technology and servers. Now we have Dell technology, and they have our enterprise storage."
Soran, a good sales guy with enough ego to sell his vision to early-stage investors and venture capitalists, generally credits those around him with most of his success. He is a millionaire twice over after selling Xiotech and now Compellent.
He grew up in a family of six kids. His dad, a teacher who spoke several languages, also worked as a licensed pharmacist by night and a pilot in the Naval Reserve weekends. Soran said he is proud of Compellent and his accomplishments, but careful to not get too full of himself.
"I've got a wife and four grown kids who always spoke their mind," said Soran, a volunteer park board basketball and softball coach for years. "They kept me grounded."
Staff Writer Patrick Kennedy contributed to this column.
