Carl Bergquist was 29, a college graduate and former Army lieutenant, when he quit a corporate job in 1964 to strike out on his own.
Bergquist accepted a retiring neighbor’s offer to take over as a manufacturer’s representative for a line of electrical varnish.
“I didn’t have a plan,” recalled Bergquist, 79. “But my father, a baker in south Minneapolis, said if you’re going try something and you go broke, do it when you’re young. Not when you have a family. I had all of $300 in the bank.”
Bergquist hedged his entrepreneurial instincts by staying on as a part-time night file clerk at Sheldahl.
Smart move. His first month’s commission check was all of $32.
Last fall, 50 years later, he sold his privately held Bergquist Co. for $570 million to German industrial conglomerate Henkel.
“It’s God’s money, not mine,” said Bergquist, who said he and his wife, Libby, plan to step up their anonymous philanthropy. “We have been so blessed.”
Chanhassen-based Bergquist Co. had sales last year approaching $200 million and employs 1,000 people, most at five Midwest sites.
Yet, Carl Bergquist struggled for success for nearly his first 15 years as a business owner.
Early on, he decided representing manufacturers was too narrow. He became a distributor, storing inventory for several manufacturers. It was a nice small business. Within a few years Bergquist decided to manufacture something in order to build a factory and build equity.
A silicone company asked Bergquist to develop a material to replace mica and grease behind power transistors. His first try failed.
Bergquist hit the target in the late 1970s with an innovative thermal interface material. He started a manufacturing operation that flourished with the burgeoning circuit-board industry. This led to the modern-day Bergquist that operates three divisions: thermal products, membrane switches and touch screens.
The company was growing smartly by 1980, but Bergquist wasn’t happy. He studied the Bible through a fellowship group and concluded he was self-centered. Bergquist asked the late Dave Koch, then CEO of Graco and a philanthropist and community volunteer, to mentor him. And Bergquist started donating a healthy percentage of profits to charities.
“It had been too much about me and my success,” Bergquist said. “My focus became watching our people develop and prosper. They were so creative and they solved the problems. I used to say that we needed to ‘obsolete’ ourselves with better products. Because of our people, we created new products and I got to build factories and expand.”
Hunt Greene, managing partner of Greene Holcomb Fisher, Bergquist’s investment banker, said Bergquist chose the buyer who offered the best future for the company and employees and not the top dollar.
“Carl is the classic Minnesota entrepreneur who built a highly successful business that considered all constituents, including community and employees as well as profit,” Greene said. “This was a key part of the success formula that created a win for all involved. … Henkel pledged to maintain a number of significant practices and [employee] benefits.”
Henkel doesn’t give away 5 percent of profits, but Bergquist said he will do much more than that every year. But anonymously, “so no one is beholden to us.”
Bergquist, a conservationist and sportsman, has long had a cabin near Grand Rapids. Libby was OK with business travel, but could get irritated over long fishing and hunting trips to northern Minnesota.
“So we built a plant at Big Fork 25 years ago that employs 100 people,” Bergquist said. “And some days I would fish instead of going to the plant!”
A couple of his four children worked in the business for extended periods but family succession wasn’t in the cards.
“I admire my dad,” said Joe Bergquist, a 43-year-old son who once worked at the company. “He’s not perfect … but I can tell you … after he came to know the Lord … he knew that money is not a reason to do business. It’s a consequence of doing business well. You’ve got to be smart, take care of your employees, your customers and your vendors. If you focus on a quality job … the money will come.”
Carl Bergquist also has a place in Florida. But he says he’s not moving to the low-tax state.
“Minnesota is my state,” he said, adding that he reserves the right to complain about taxes. “This is where I made the money.”