He challenged the conventional teachings at business schools. He’s a 25 Top Visionary, one of the Top 24 Most Powerful Men In Business, and advises people to hang out with people who are better than you.

I wanted to add to the Warren Buffett story by sharing another valuable lesson from one of the world’s richest men: Never Back Down!

“You’re neither right nor wrong because other people agree with you,” says Buffett. “You’re right because your facts are right and your reasoning is right – and that’s the only thing that makes you right. And if your facts and reasoning are right, you don’t have to worry about anybody else.”

Buffett made a career out of taking the road less traveled. He is a value investor; he spends his time looking for securities whose selling prices are lower than their intrinsic value. He ignores the stock market, instead choosing to look at the overall potential of a company in the long term. Claiming that his favourite holding period is “forever”, Buffett’s conservative nature has distinguished himself from other investors.

Despite having many followers, value investing still has its critics. Taking this road less traveled was not always easy for Buffett, who has endured years of ridicule for his investment decisions, particularly during the dot-come frenzy. In 1999, Berkshire Hathaway stock grossly under-performed and analysts claimed that Buffett’s career was over because he had missed the technology boom. Wall Street thought he had committed the biggest mistake of his career and wrote him off. That is, until the dot-com bust in the early 2000s when his strategy proved infallible. “It was a mass hallucination, by far the biggest in my lifetime,” recalls Buffett.

Time after time, Buffett has listened to his gut instinct – and his vast research – to inform his business decisions. When others were acting and reacting to the stock market, Buffett was standing strong in his decisions. “You do things when the opportunities come along,” he says. “If I get an idea next week, I’ll do something. If not, I won’t do a damn thing…Much success can be attributed to inactivity.” His strategy is admittedly simpler than most investors feel comfortable with, claiming, “I don’t look to jump over 7-foot bars: I look around for 1-foot bars that I can step over.” But, there is genius in its simplicity.

Having the confidence to follow his instincts, however, never meant that Buffett was willing to make an irrational decision. Buffett knew when he was in trouble and he knew when to walk away from something. “One’s objective should be to get it right, get it quick, get it out, and get it over…your problem won’t improve with age,” he says. “Should you find yourself in a chronically leaking boat, energy devoted to changing vessels is likely to be more productive than energy devoted to patching leaks.”

Buffett knew that no matter what move he made he would always have his critics. He decided early on, however, that regardless of what anyone else said or did, he was not going to break his stride. “The important thing is to keep playing, to play against weak opponents and to play for big stakes,” he says.

By marching to his own beat, Buffett was able to surpass his competition. He wasn’t afraid to try something new. After all, “if past history was all there was to the game, the richest people would be librarians.”

Have you benefitted in your entrepreneurial career by never backing down? I’d love to hear your story!

[via YoungEntrepreneur] by Evan Carmichael

First, some numbers. The United Nations estimates that by 2025, two-thirds of the world’s population will face periodic and often severe water shortages. And the problem is not limited to the developing world. Here in the U.S., water managers in 36 states are predicting significant shortfalls within the next decade. Even in regions that do have sufficient supplies, aging infrastructure, inadequate treatment facilities, and contamination pose more problems. No surprise, then, that battles over water rights are becoming commonplace, pitting states and sometimes nations against one another in increasingly bitter conflict.

Analysts estimate that the world will need to invest as much as $1 trillion a year on conservation technologies, infrastructure, and sanitation to meet demand through 2030. As in the past, most of the large capital-intensive projects will be done by the usual multinational corporations and engineering firms. But the extent of the problem and the demand for new technology to address it present — pardon the metaphor — a kind of perfect storm for entrepreneurs. “Small companies with intellectual property, significant know-how, and a product that’s scalable can stake out a niche below the radar of the large companies,” says Laura Shenkar, a water expert and consultant in San Francisco. “This is an opportunity that will generate Googles.”

In the pages that follow, Inc. examines the emerging water economy and takes a trip along the water trail, from source to sewer. Our guides on this journey: 11 extraordinary entrepreneurs who are creating radical change at every step of the way. Some of their innovations are striking in their simplicity. Mark Sanders’s AQUS System uses water from bathroom sinks to fill toilet bowls. Others push at the limits of science and technology. Fatemeh Shirazi, for example, is “training” microorganisms to kill pollutants in water. What they share is a vision, a drive, and an address — the sweet spot at which blue meets green.

Increasing the Supply

Born in Swaziland, raised in Zimbabwe, and educated in South Africa, Amanda Brock knows what water scarcity looks like. “I have seen and lived through waterborne diseases, childhood mortality, cholera, typhoid,” she says. “I have lived the poverty that comes from inadequate access to a fundamental resource like water. And with global warming, it’s getting worse.”

The desire to do something about it is what led the former Enron executive and water-industry consultant to take the CEO spot at Water Standard, a start-up founded by Florida entrepreneur Andrew Gordon. Water Standard plans to bring water to dry regions in a new way: by installing state-of-the-art desalination plants inside retrofitted tankers and delivering freshwater, via pipeline or by ship, to thirsty cities on the shore.

The ships, which Brock says can be outfitted in less than a year at a cost of about $150 million, will be anchored from one to five miles offshore and will be capable of producing up to 75 million gallons of freshwater a day — enough to meet the basic residential water needs of a small city. And because they will operate in deep water rather than close to shore, the ship-based plants should promise to virtually eliminate the negative environmental side effects often cited by critics of desalination.

Specially designed intakes will draw seawater from a greater depth and at a slower speed than typical desalination facilities, thus reducing injury to aquatic life, and the concentrated brine produced in the desalination process will be thoroughly and rapidly diluted before it is returned to the sea, far from the more ecologically sensitive zone close to shore. While the ship-based plants will have a carbon footprint — initially, they will run on marine-gas turbines or new emissions-compliant diesel generators — Brock hopes eventually to generate energy using ocean-current or wave-action turbines.

Freshwater already is exported via tankers between France and Algeria and Turkey and Israel. And smaller-scale barge-based desalination systems operate in the Middle East and India. Tom Pankratz, a desalination consultant and the editor of Water Desalination Report, expects mobile barge- and ship-mounted systems to play an important role in increasing the supply of freshwater — whether by addressing site-specific environmental concerns or space limitations, getting facilities up and running faster than the two to seven years it takes to construct a land-based plant, or responding to emergency or temporary needs.

Investors seem to like the idea. In March, Water Standard secured $250 million in venture funding, one of the largest investments to date for a water start-up. The company’s first vessel — a tanker that’s currently used to transport vegetable oil — should be ready to sail sometime in 2009. And thanks to recent regulations requiring that oil tankers be double hulled, there is an abundance of older single-hulled ships that are perfectly suited to join the fleet. Brock has spent much of the past year meeting with investors and potential customers in the Middle East, Chile, Cyprus, India, and China.

Whether based on land or at sea, almost all desalination plants built after 2000 use a technology called reverse osmosis, or RO, to get the salt out. Water is pushed at high pressure through a membrane that lets freshwater pass through but blocks salt and contaminants. RO technology is generally more efficient than other desalination methods that use heat to evaporate and distill water, but it still requires a lot of energy — at seawater plants, almost half the costs are for the electricity required to push water through the membranes. This makes desalination one of the most expensive ways to produce freshwater: The cost of producing 1 cubic meter (264 gallons) of desalinated water ranges from about $1 to $1.50, compared with 10 cents to 20 cents to obtain water from a reservoir or well. (Average U.S. daily household use is about 350 gallons.)

The Los Angeles-based start-up NanoH2O is working on a way to make the process a lot more efficient. The company was founded in late 2005 by Robert Burk, an engineer with extensive experience on water and wastewater projects, and current CEO Jeff Green. It is now ramping up for mass production of a nanocomposite membrane based on technology developed by researchers at UCLA led by Eric Hoek, a professor of civil and environmental engineering. In pilot studies, it has proved nearly twice as productive as existing membranes — meaning you can get almost twice as much water with the same energy input or the same amount of water for half the energy — and has the potential to reduce the total expense of desalinated water as much as 25 percent. That would make it a far more attractive proposition for communities looking to diversify their water portfolio.

Unlike traditional RO membranes, which are just filters made of a dense polymer, NanoH2O’s polymers interact with “thirsty” nanoparticles to draw in water and repel salt and contaminants as well as the organic materials and bacteria that tend to adhere to conventional membranes and decrease efficiency over time. The technology was an academic research project when Burk and Green, a serial entrepreneur who previously founded the software start-ups Stamps.com and Archive Inc., came across it in their search for a water-related technology to build a company around.

Why water? It’s where the action is, Green says. Software, he believes, has largely become commoditized. With water, on the other hand, “core technology and intellectual property are still differentiators,” he says. “As an entrepreneur, when you see the scarcity issues, and you see that technology can make a difference and that it’s still a little early on the curve, all those factors led to a decision that it would be a good time to start to look into this.”

Green and Burk moved quickly to secure the intellectual property through UCLA’s tech transfer program and closed a seed round to speed up work. In 2007, the company received $5 million from Khosla Ventures, the clean-tech investment group led by Sun Microsystems co-founder Vinod Khosla. In August, it got $15 million more from Khosla and Oak Investment Partners. Now, with 11 employees and several prototypes being tested in the field, NanoH2O is in the process of shifting from a research and development venture to an operating company, with the goal of bringing a product to market by the end of next year. The market for RO membranes is dominated by big players — including Dow, General Electric, Koch Industries, and the Japanese companies Nitto Denko and Toray. But Green is unfazed. “As big as Dow or GE are, they don’t apply all their energies to reverse osmosis — if you have the resources to stay independent, you can compete for that segment,” he says. “For me as an entrepreneur, it’s an exciting place to be.”

Desalination, of course, is well and good for communities that are close to the ocean and that can afford relatively expensive water. In the villages of sub-Saharan Africa, that’s not the case. Forty-two percent of the region’s population lacks access to a safe water supply, and the impact of waterborne diseases on public health is staggering: Of the 396 million cases of malaria every year, the majority are in sub-Saharan Africa; 90 percent of those who die from the disease are children under 5. About 100 million Africans are infected with the parasitic disease schistosomiasis, which kills tens of thousands annually, also mostly children. The death toll from diarrheal diseases is probably much higher. What’s more, a lack of reliable, clean water precludes meaningful economic development. By one estimate, some 40 billion hours a year are spent collecting water in sub-Saharan Africa — or roughly a year’s labor for the entire work force of France. The work usually falls to women and children, who are left with little time for things like growing food or going to school.

Moving Water Industries, an 82-year-old, family-owned manufacturer of water pumps based in Deerfield Beach, Florida, has been selling portable pumps for irrigation and flood protection in Nigeria for more than 30 years. But its mission in Africa has taken on a new focus: addressing the problem of safe drinking water in rural villages. The company’s solution is the SolarPedalFlo, a solar- and pedal-powered pump that can provide filtered and chlorinated water for thousands of people a day — three to four times the amount that can be produced from a borehole equipped with a hand pump. Each unit costs about $15,000.

Working with local governments, nongovernmental organizations, and the U.S. Agency for International Development, MWI has been able to install hundreds of the pumps in 12 African countries. The company is just introducing the technology in Central and South America and has one unit installed in the Philippines. With the hopes of speeding adaptation in Africa, it is in discussions with Green WiFi, a U.S.-based volunteer group that is working to install solar-powered Wi-Fi networks in the developing world. Together, the companies would be able to offer a compelling infrastructure two-for-one: clean water and Internet access powered by the same set of solar panels. William Bucknam, MWI’s vice president and point man in Africa, hopes that pressure to meet the U.N.’s Millennium Development Goals — decreasing the number of people without access to safe drinking water by half by 2015 — will encourage more of the public-private partnerships that will be needed for the technology to spread. “It’s a huge problem,” he says, “and we believe we have the answer.”

Treating It

In spring 2007, the Department of Homeland Security issued an alert about a new terrorist threat: chlorine truck bombs. At least five had been exploded in Iraq, killing scores of people and injuring many more who inhaled toxic fumes. The insurgents who carried out the attacks probably stole the chlorine from water-purification and sewage treatment plants, which use the chemical for disinfection. Authorities here worried about the 2,000 or so U.S. water systems that store Environmental Protection Agency — regulated quantities of chlorine. More than 100 treatment facilities are in densely populated areas, where an explosion could expose more than a million people to toxic gases.

Some say the threat was overrated. But the underlying facts were real — and for at least one company, the heightened awareness was good news. MIOX, an Albuquerque-based outfit founded in 1994, makes compact generators that allow water treatment facilities to produce a liquid chlorine — based solution on-site, using only water, salt, and electricity, eliminating the need to store or transport hazardous chemicals. (The company also makes a hand-held battery-powered version of its generator, used by backpackers and military personnel.)

The gold standard of disinfection for more than 100 years, chlorine kills bacteria, viruses, and other pathogens, and it has played a key role in eliminating diseases such as typhoid and cholera in the U.S. And chlorine’s benefits in water are twofold: it not only disinfects but also remains at a residual level in the water, preventing reinfection by viruses or bacteria during transport, storage, and distribution. For that reason, the EPA and state regulators require that all municipal drinking water contain a measurable chlorine residual. So even as new disinfection methods, such as using ozone and UV light, gain popularity, they continue to be used with some kind of chlorine-based treatment.

Safety and security alone might have been sufficient drivers to propel MIOX’s technology. But since joining the company as CEO in 2005, Carlos Perea, a veteran of the semiconductor and telecom industries, has been highlighting other benefits. Water quality is one: Using freshly generated chemicals helps avoid the development of undesirable chlorine byproducts. And because the MIOX generator can produce a “mixed oxidant” (hence the company name) that disinfects water with less chlorine, treated water has less chemical taste and odor, and there is less buildup of biofilm and algae in the treatment system. But cost and carbon savings are an even bigger selling point. “It doesn’t make sense to transport chemicals when you can generate them yourself at a fraction of the cost and a fraction of the impact,” Perea says.

In August, the 77-employee company received $19 million in Series C funding from several venture capital firms, including DCM, Sierra Ventures, and Flywheel Ventures. Water utilities in Santa Fe, New Mexico, and other cities now use MIOX generators. The U.S. Navy also uses them on some of its ships. For some large beverage makers, MIOX equipment is the first disinfection step in their bottling processes. Other industrial and commercial customers are looking to use the system as a component in self-contained water recycling systems to disinfect water before it is reused for, say, landscape maintenance or cooling. “Moving water is so power intensive, such a huge energy user, that it doesn’t make sense to continue to treat it one place, pump it, live with losses and degradation, and move it someplace else to dispose of it,” says Perea. “If you have a swimming pool, you don’t fill it up and dump it out every time that you use it; it just wouldn’t make sense.”

In a developing country like India, the ability to treat one’s own water at home can be a matter of life and death. According to a 2002 World Health Organization study, 782,000 deaths, or 7.5 percent of all deaths in India that year, were caused by diseases related to unclean water. Even in places where municipal tap water is available, quality is unreliable, and the water runs for only part of the day. Much of the population gets drinking water from vendors who sell it from tanker trucks.

Those with limited means often purify water by boiling it or mixing it with iodine tablets. Those who can afford it use home water-purification systems. One of the companies capitalizing on demand for such systems is Eureka Forbes, India’s largest manufacturer of home water-purification systems. And since 2006, a Bothell, Washington, company, HaloSource, has played an integral part in Eureka Forbes’s effort to make such systems much more affordable.

HaloSource manufactures a sort of turbocharged version of the cartridge that goes in your Brita pitcher at home. But whereas the Brita cartridge merely filters water, thus improving appearance and taste and removing some contaminants, the HaloPure biocidal cartridge — packed with tiny polystyrene beads that have bromine ions chemically bonded to their surface — disinfects it, eliminating viruses and bacteria.

Eureka Forbes is using HaloPure cartridges in gravity-fed countertop water purifiers that let a family treat and store up to 6.5 gallons of water at a time. Unlike ultraviolet purifiers, countertop water purifiers don’t require electricity to work, and their lower cost — $40 to $60, versus $200 to $300 — puts them within reach of India’s burgeoning middle class.

HaloSource also manufactures products used for recreational water treatment and storm-water management, as well as antimicrobial coatings for textiles. But the company, which has annual revenue of more than $10 million, sees its biggest opportunities in water purification. HaloSource has partnered with the Brazilian consumer-device maker Everest, which will use HaloPure cartridges in countertop water purifiers, and the Chinese manufacturer Chanitex, which uses them as a component in reverse-osmosis purifiers for homes and businesses. HaloSource now has manufacturing facilities in Bangalore and Shanghai, as well as in Washington State.

In 2007, the company secured $15 million in funding from the Abu Dhabi-based Masdar Clean Tech Fund. “In China and India combined, you’ve got close to three billion people who will be looking for consumer-product solutions to problems they’ve dealt with for generations,” says Andrew Clews, HaloSource’s vice president of marketing and business development. “Access to clean, safe drinking water is certainly one of those issues.”

Storing It

It’s nice to imagine that water flows magically from a pristine reservoir or spring to your home faucet, but that’s simply not the case. As we have seen, it is disinfected and pumped along through a sprawling network of water mains and pipes. The U.S. water network, much of it built in the 1950s and ’60s, will require some $277 billion worth of construction, upgrades, and replacement in the next 20 years, according to EPA estimates. With scarcity driving water agencies to fix leaks — by some estimates, about six billion gallons per day in the U.S. are lost through literal cracks in the system — companies making high-tech metering and leak-detection technologies are doing well for themselves.

San Rafael, California-based PAX Water Technologies, founded in 2006, is focusing elsewhere, on a relatively overlooked niche in the distribution chain: water storage tanks. Though the numbers are hard to tally, there may be as many as 400,000 storage tanks in use in the U.S. today, according to PAX Water’s vice president of marketing, Jason Oppenheimer, who came to the company after nearly a decade of working on water infrastructure projects as a civil engineer.

After being treated, drinking water can spend as long as 100 days in the distribution system before reaching an end user. That’s not necessarily a bad thing, but when water sits in a tank too long, it begins to stagnate and settle into layers of different temperatures, as in a lake. In warmer layers at the top, the disinfectants used in treatment are burned off, which increases the potential for contamination. Even when the water is being used, poor tank design can create an uneven distribution of disinfectant and encourage uneven aging, allowing water at the bottom of a tank to be replenished more quickly than water at the top.

The traditional solution is to dump more disinfecting chemicals into the holding system, which has environmental and economic costs and can lead to the formation of chemical byproducts. Water agencies also use energy-intensive “operational cycling” — basically pumping moving water around from tank to tank — or even dump some water at the end of the line to allow fresher water to flow into a stagnating system.

The energy-efficient, inexpensive, and elegant solution proposed by PAX Water is called the Lily impeller. Featured in a 2008 design exhibit at New York City’s Museum of Modern Art, the Lily — a spiral propeller whose shape calls to mind a calla lily — is not just pretty but powerful. When installed on the bottom of a storage tank, the impeller, which weighs less than 70 pounds, can mix up to seven million gallons of water while drawing the same amount of energy as three 100-watt bulbs. Mimicking natural convection currents, the mixer evenly circulates water in the tank, thus reducing or eliminating the need to add disinfectant. Several states require new and retrofitted storage tanks to include some of kind of mixing system — a potential boon for PAX Water.

The water mixer came to market in 2007 and won the People’s Choice Award in the New Product Technology Showcase at the American Water Works Association convention. The same year, PAX Water launched a beta program in California. That helped open up the market, and by mid-2008, the company had about 25 of the $30,000 units installed in municipal storage tanks. Dan Heimel, a water quality specialist in Redwood City, California, which participated in the pilot study and subsequently purchased a mixer for a troublesome water tank, says the system solved the city’s thermal stratification problem.

But for Oppenheimer, storage tanks are just the beginning. A floating solar-powered impeller, for example, could improve surface water to be treated for drinking or even provide basic wastewater remediation in an off-grid environment. “We think that our technology has huge potential to help natural remediation of water bodies and all sorts of applications around the world,” he says.

Conserving It

As a kid, Mark Sanders hated brushing his teeth with cold water. But watching all that clean, drinkable water run down the drain as it warmed up bugged him. So at the age of 9, he began thinking about ways to capture it and save it for some other purpose — say, flushing the toilet. Three decades later, during a visit with his wife’s family in drought-stricken Oklahoma in 2000, he took up the problem again with a newfound sense of urgency.

On the plane ride home to Louisville, he made a sketch of a water recycling system that would take used water from the bathroom sink, disinfect it, and reroute it to the toilet tank for flushing. Back home, he took the drawing to a friend who did home remodeling, and two weeks later — with a hot glue gun, some PVC pipe, and a Tupperware container — the friend had a prototype working in his own home. Sanders, a CPA by trade and at the time the CEO of a large medical practice, patented the system, built a basic website, and began touting the system to anyone he thought might be interested. The result: thousands of hits for the site and affirmation that the interest was out there.

In 2003, Sanders left the medical practice and founded WaterSaver Technologies; he picked up a partner, Tom Reynolds, along the way. After the two spent a couple of years raising money and testing prototypes, the system, dubbed AQUS, made its big-time debut at a water-industry trade show in 2006. Sanders describes the response as “incredible,” especially from water companies in the increasingly parched South and Southwest, excited at the prospect of adding another water-saving device to the arsenal of products for which customers already receive rebates.

Indeed, utilities have found that offering customers rebates for things such as low-flow showerheads and toilets and efficient front-loading clothes washers has been a reliable and cost-effective way to curb water use — and the related cost of energy to supply and treat water and wastewater. (In California in 2005, for example, about 19 percent of electricity use, 30 percent of natural gas consumption, and 88 million gallons of diesel fuel were used to move and treat water.) Thanks to such efforts, total U.S. per capita water use has declined from a high of 1,950 gallons per day in 1977 to 1,480 gallons per day in 2000, according to the Pacific Institute, a nonprofit research group.

The AQUS System — named one of the 100 best innovations of 2007 by Popular Science magazine — uses standard plumbing parts and can be installed by a professional plumber in about two hours. Priced at $395 (before rebates), it can save up to 6,000 gallons of water a year in a two-person household. Cutting-edge green architects use AQUS in their home designs, and Sloan Valve — the world’s leading manufacturer of water-efficient plumbing devices — recently agreed to distribute the product. “People are just now beginning to be aware of the value of water and the dollar savings they can achieve,” says Jim Allen, head of Sloan’s water-efficiency division. Sanders and Reynolds — who remain the company’s only employees for now — aim to sell 5,000 to 10,000 units in the first year of the Sloan deal, ramping up to as many as 300,000 after five years. Allen expects the market to swell as more states mandate water-efficient technologies.

That kind of regulation — coupled with compelling economics — has already helped Falcon Waterfree Technologies, another pioneer in restroom efficiency. If you are male, and you have recently heeded nature’s call at Dodger Stadium, the Hollywood Bowl, the “Bird’s Nest” at the Beijing Olympics, or the Taj Mahal, you may be familiar with its product. Falcon, founded in 2000, claims about 90 percent of the worldwide market for water-free urinals and revenue of more than $15 million a year.

Like WaterSaver, Falcon, headquartered in Los Angeles and Grand Rapids, Michigan, piggybacks on the existing sales and distribution networks of established partners in the sanitary equipment industry (it, too, has a partnership with Sloan in the U.S.). “In many respects — on a significantly smaller scale — we’re really not unlike Intel,” says James Krug, Falcon’s CEO. “We are the technology that powers the urinals.”

Here’s how it works: Urinal manufacturers create the “bowl with a hole” — a porcelain or metal unit designed with a smooth, easy-to-clean surface. A stainless-steel housing provides a perfect seal between the opening and a patented cartridge containing a biodegradable liquid with a specific gravity lighter than water. As soon as urine passes through the cartridge, this lighter liquid covers it and creates an airtight seal, blocking any escaping odor of urine and sewer gases. Unlike with conventional urinals, there is no “flush plume” to spread bacteria and no moving parts that require maintenance; cartridges just need to be replaced every 7,000 uses or so. “Pound for pound, our system is probably the most effective water-conservation device out there,” Krug likes to brag. “It doesn’t reduce water use by 10, 20, or 30 percent — it’s a 100 percent reduction. Each urinal saves about 40,000 gallons of water a year.”

Falcon is backed by some very heavy hitters. Its founder and lead investor is Marc Nathanson, a cable entrepreneur and chairman of Voice of America in the Clinton administration. In 2006, Capricorn Management, an investment group founded by Jeff Skoll, eBay’s first president, bought 25 percent of Falcon. And its board of advisers includes Al Gore, Richard Gephardt, and former Los Angeles mayor Richard Riordan.

Acceptance of a waterless urinal was once the challenge. Now the challenge is competition, including new rivals such as Kohler and Zurn. Still, Krug believes that by continuing to invest heavily in R&D, he is keeping ahead of the curve. And competition has its advantages, too. “When everyone else joins in,” he says, “you know you’ve gone from fringe to mainstream.”

Here’s a fact: According to the American Water Works Association, 58 percent of urban water goes to landscape irrigation. And as much as half of that is lost or wasted because of evaporation, wind, or improper irrigation design, installation, maintenance, and scheduling.

Chris Spain, co-founder and chairman of Petaluma, California-based HydroPoint Data Systems, saw an opportunity in those lost 3.5 billion gallons. After selling a software start-up in 2000, Spain and two partners began plotting their next move. Water was especially attractive. “One, it seemed to be a huge issue that a variety of macro trends were driving to a crisis point,” says Spain. “And two, there seemed to be a huge absence of focus, investment, and innovation.”

They came across a company in Petaluma that had patented a compelling technology — a system that used live weather data, rather than preset timers, to tell sprinklers when and how much to water crops, lawns, and commercial landscapes. They acquired the company, raised funds from angel investors, and went to work upgrading the technology. Now known as WeatherTRAK, the system uses data retrieved from the National Oceanic and Atmospheric Administration satellites that gather information from 40,000 weather stations across the country. WeatherTRAK’s database and servers can accurately map weather conditions — wind, humidity, and temperature — for any given square kilometer in the U.S. Subscribers to the system (commercial users pay $225 per year) need only set a sprinkler controller with some information about the plants and topography of their site, and the system takes over, sending weather updates via satellite to automatically adjust watering needs to real conditions on the ground.

There are some 45 million irrigation controllers nationwide, and according to a survey by the American Water Works Association, most still have the same settings they had when they left the factory. The result: overwatering, often accompanied by runoff into neighboring surface waters. By watering landscapes just enough, the WeatherTRAK system cuts water use up to 59 percent.

Agriculture would seem to be an obvious market. But long-term contracts for purchasing water give farmers extremely low prices, so they generally have little incentive to invest in conservation. So HydroPoint has focused on commercial and institutional clients. Among its 15,000 subscribers: Wal-Mart, Coca-Cola, Google, Lowe’s, and the cities of Newport Beach, California, and Charleston, South Carolina. In 2007, those 15,000 customers saved a combined 6.7 billion gallons of water. Lockheed Martin estimates it saves $1 million a year using WeatherTRAK at its two Silicon Valley campuses.

Keeping It Clean

Though drought is one of the more obvious consequences of climate change, water experts are equally worried about the problems caused by extreme storms and flooding that many, if not most, scientists believe are another consequence of global warming. Long underregulated and undermanaged, storm-water runoff has become a concern for its effect on surface and ground water, as well as the additional burden that it puts on already creaky wastewater treatment facilities when it is treated.

Glenn Rink, founder and CEO of Scottsdale, Arizona-based AbTech Industries, first used his Smart Sponges — made from a synthetic polymer — in 1997 to clean up oil spills from tankers at sea. In 1999, when he turned his attention to storm water, most regulation was focused on runoff from new construction. “No one was really doing anything about dealing with the billions of gallons of rain that come down on the roads and go into our flood-control devices and are contaminated on the way through,” he says. So Rink figured out how to mold the sponge material into different shapes that would fit into street-level storm drains and catch basins, soaking up oil and debris and letting clean water pass through. Later, he developed a way to coat the sponges with an antimicrobial agent so they would disinfect water as well. The next iteration will add the ability to capture heavy metals, herbicides, and pesticides.

Long Beach, California, installed 2,000 AbTech filters in June 2004. Tom Leary, the city’s storm-water compliance officer, was primarily concerned with cutting bacterial pollution at beaches. Tests showed the Smart Sponges effectively eliminated bacteria. And in the unusually rainy year following the sponges’ installation, they also caught almost 92,000 pounds of trash and debris and 3,600 gallons of waste oil. Leary likes the technology, because unlike UV treatment or mechanical debris catchers, “it’s not outrageously expensive, and it’s easy to move around. You don’t smell them, hear them, or see them.”

Today, AbTech has 13,000 installations in 36 states and seven countries, and its 2008 revenue is expected to be 2,000 percent higher than last year’s. Seventy percent of its business is with municipal customers. But private developers and commercial entities are increasingly part of the mix. British grocery giant Tesco recently installed an AbTech system to treat runoff at a new 88-acre facility in Riverside, California. Smaller operators are employing the technology to solve niche problems — in bus depots and fast-food drive-throughs, to cite two examples. Airports, too: The ones in Newark, New Jersey, and New York’s Westchester County are among those that have installed AbTech sponges, which typically need to be replaced every two to four years; used sponges are sent to waste-energy plants and burned as fuel.

Road runoff is one problem. But pollutants from other sources are even more insidious. Hundreds of U.S. water utilities, for example, are dealing with high levels of the chemical perchlorate, a rocket-fuel ingredient that has been found in the lower Colorado River, which provides water for more than 15 million people in the Southwest, and in dozens of ground-water wells throughout California. Though the EPA has yet to set a drinking-water standard for perchlorate, Massachusetts and California have, citing health risks to developing fetuses. The gasoline additive MTBE is another troublesome ground-water pollutant, as is nitrate, a common agricultural contaminant, which at high enough levels in water causes serious illness or death in infants.

A new technology being commercialized by a company called Microvi Biotech literally eats these pollutants up.

Eliminating challenging pollutants from water has traditionally involved using mechanical filters or chemicals. Recently, researchers have experimented with using genetically modified organisms to degrade water pollutants. But until now, all these methods have had at least one major drawback: the production of a secondary waste stream of concentrated pollutants or sludge that must be incinerated or otherwise disposed of. In eliminating one kind of pollution, they create another.

Microvi’s founder, Fatemeh Shirazi, has developed what she and others believe is a safer, more efficient, and cleaner method — using so-called biological reactors that house colonies of natural microorganisms “trained” to feed off particular pollutants in water. Inside the reactor, Shirazi explains, microorganisms are “packaged” in materials and configurations that protect them from the die-off common in other treatment methods. Most remarkably, the system is self-cleaning — when the microbe population reaches a critical stage, it stops growing and cleans house, with living organisms feeding off dead ones. As a result, there is no fouling and buildup inside the reactor and no waste to dispose of — all that comes out is clean water.

“It’s unique,” says Michael Dimitriou, president of the consulting firm WaterInnovations. He discovered Shirazi’s work when he was asked to review it for a multinational water company. “It does something that’s been tried before but no one could do.” Shirazi has developed reactors that target about eight specific pollutants, including PCE, a chemical used in dry-cleaning and other industries, MTBE, perchlorate, and nitrates. The novelty of her technology was recognized with a first prize in the water category at the 2007 California Clean Tech Open competition.

Shirazi earned her Ph.D. in environmental engineering from Oklahoma State University, got her first U.S. patent in 2002, and incorporated Microvi in 2004 in Overland Park, Kansas. With $1.8 million in grants from agencies including the National Institutes of Health, she worked to troubleshoot issues with the technology. Now headquartered in Union City, California, the company has 11 employees and is beginning its first large-scale implementations. In addition to working with public water and wastewater facilities to treat emerging pollutants, Shirazi anticipates a market in treating water discharged by various industries — including the paper industry, which produces wastewater high in toxic chlorinated phenols, and the food and beverage industry, which discharges water high in organic pollutants and nitrate.

“We are in such a big mess today partly because we never thought about the consequences of discharging water that was full of pollutants,” says Shirazi. “It never made sense to me that in the name of cleaning up those pollutants, we’ve kept coming up with solutions that also have a negative impact on the environment. The idea of using biotechnology — using concepts from nature — to do this is very appealing.”

[via Fast Company] by Adam Bluestein

Family Guy = $2 Billion.

It’s not hard to find someone who delights in attacking the show Family Guy. Which isn’t a criticism, per se. Much of the animated sitcom’s purpose seems to be to stoke the opposition, to offend the easily offended. But that’s not the only reason it annoys people. There is a school of thought that says the show is hackish — crudely drawn and derivative of its cartoon forebears. Members of this school would include, most prominently, Ren & Stimpy creator John Kricfalusi, and Trey Parker and Matt Stone, the fathers of South Park, which is probably the only show on television that rivals Family Guy for objectionable content per half hour. South Park has devoted entire episodes to attacking Family Guy, portraying the show’s writers as manatees who push “idea balls” with random jokes down tubes to generate plotlines. Kricfalusi has said, “You can draw Family Guy when you’re 10 years old.”

What does Family Guy creator Seth MacFarlane — who earlier this year inked a $100 million — plus contract with Fox, followed by a breakthrough deal involving Google — have to say about that?

“I would say, ‘How many violas do you have?’ ”

MacFarlane is hovering over the soundboard in the control room of the Newman Soundstage on the 20th Century Fox lot in Los Angeles. Various engineers twiddle knobs and adjust levels as he looks out on a gymnasium-size room full of classically trained musicians tuning their instruments. Every piece of music on every episode of Family Guy is recorded live by an orchestra that on this day numbers 56. The only music that ever repeats, even once, are the opening and closing themes, and those too are frequently updated, just because. Now, it is not unprecedented to use a live orchestra in today’s TV world. But it is highly unusual. “All the shows used to do it,” laments Walter Murphy, one of Family Guy’s two composers. “It’s mostly electronic now — to save money.” The Simpsons, he says, still uses an orchestra, as does Lost. King of the Hill has a small band. And, of course, there’s an orchestra on American Dad, the other show created by MacFarlane, who is now the highest-paid writer-producer in the history of TV.

MacFarlane, despite being 35 and looking like an average dude, possesses the musical inclinations of a septuagenarian drag queen. A significant percentage of Family Guy episodes feature extravagant Broadway-inspired song-and-dance numbers (because, really, why have the cartoon doctor tell his patient he has end-stage AIDS when a barbershop quintet can break the news via song?), and only some of them are sacrilegious or scatological. Among the features of his new contract with Fox is a Family Guy movie he imagines as “an old-style musical with dialogue” in the vein of The Sound of Music, a poster of which hangs above his desk. “We’d really be trying to capture, musically, that feel,” says MacFarlane, whose father moonlighted as a folk singer. “Nothing today feels like it’ll play 50 years from now, like Cole Porter or Rodgers and Hart.”

If you’re waiting for the punch line here, there isn’t one. Critics may dismiss MacFarlane’s show for being vulgar, but when he writes a song, it’s going to be lush and jazzy and, at least musically, exactly as you might hear in something by Irving Berlin. It’s all part of a manic attention to detail that not only gives the show its layered humor but also has made MacFarlane a massive multiplatform success.

MacFarlane is more than just an eclectic entertainer. Stripped of its crude facade, Family Guy — indeed, all of MacFarlane Inc. — exposes itself as a quintessentially modern business with lessons that extend far beyond TV land. MacFarlane has divined how to connect with next-generation consumers, not simply through the subject of his jokes but by embracing a flexibility in both format and distribution. He has also stepped outside the siloed definitions of a single industry (Hollywood) and exploited opportunity wherever he could find it (Silicon Valley). And perhaps most instructive, his success is not predicated on his product being all things to all people. He has bred allegiance from his core customers precisely because he’s been willing to turn his back on (and even offend) others — a model of sorts for how to create a mass-market-size niche business in our increasingly atomized culture.

MacFarlane is a fairly unassuming young man. He is partial to long-sleeve T-shirts, fraying jeans, and laceless black Chuck Taylors. Various stories have described him as prematurely graying, but today his hair is convincingly black and lightly gelled, and he’s wearing wire-rimmed glasses. Beard stubble is a staple. The net effect is the look of a full-grown, thinking man’s frat boy, which also pretty well sums up the target of his comedy (minus, perhaps, the full-grown part).

His show concerns the Griffins of Quahog, Rhode Island, whose patriarch is Peter, voiced by MacFarlane. Like Homer Simpson, he is lovable but bumbling, overweight, and a little slow-witted (a recent plot development is that he’s mentally retarded, but just barely). His wife is Lois, cartoon sexy and much sharper; she adores him despite his flaws. They have three children: Chris, overweight and dim, in so many ways his father’s son; Meg, smart but underappreciated and ever the butt of jokes about her homeliness; and Stewie, the infant pedant with the football-shape head who secretly wishes to murder his mother. Rounding out the clan is Brian the talking dog. He lusts after Lois, drinks martinis, and has been known to snort the occasional line of blow. (MacFarlane also voices both Brian and Stewie.)

Back in the soundstage control room, with the orchestra on the other side of the glass, a bank of flat screens are frozen on an image of Stewie staring out a window, forlorn. MacFarlane tells me that in this future episode, Stewie has been left home alone while the family goes on vacation.

“Let’s try it once with the dialogue,” Murphy says to his musicians. Stewie’s quasi-British voice — inspired by Rex Harrison, MacFarlane says — booms through the control room. “Oh, Mommy! Thank God you’re home! I promise with all my heart that I’ll never say or do anything bad to you for the rest of the evening.” Comedic pause. “By the way, I disabled the V-chip and watched so much porn.”

Out in the orchestra room, trombonists erupt in laughter.

It is a violent collision of high and low — classical musicians accustomed to the Hollywood Bowl recording music for a show heavy on poop jokes — and a perfect lens for examining why this man sipping coffee from a paper cup emblazoned with the Fox logo has such an enormous and perpetual grin.

*****

It would be fair, at this point, to call Family Guy a juggernaut. If you’re looking to get acquainted, it airs Sunday evenings at 9, just after The Simpsons, which it has surpassed as the most-popular animated show on TV. Among males 18 to 34, often cited as the most desirable demographic in advertising, Family Guy is the highest-rated scripted program in all of television (American Dad ranks sixth). It is the second-highest-rated show among males 18 to 49. It is among the most-downloaded shows on iTunes and the most-watched programs on Hulu, and it was the eighth most-pirated show of 2007 on BitTorrent sites.

Next spring, MacFarlane will introduce The Cleveland Show, a spin-off starring the Griffins’ African-American neighbor. The show will be MacFarlane’s third in prime time and the first new product of his megadeal with Fox. (He is also prepping a live-action movie, but no title or dates have been announced.)

A common complaint about MacFarlane’s shows is that they are random and disjointed, with episodes that veer wildly off course for no apparent purpose. A human-size chicken, for example, has been known to show up and battle Peter, apropos of nothing, in elaborate fight scenes that mimic movies like Raiders of the Lost Ark and stretch for more than a minute.

The show’s tangents are intentional, but in no way intended to advance plot. MacFarlane admits that sometimes vignettes are inserted into an episode just to fill time, or just because they’re good for a laugh, regardless of plot relevance. As a result, Family Guy is easily digested in bite-size portions — the breakout gags, like the musical numbers, can be watched in isolation, at any time, and still work. This makes MacFarlane’s show especially well suited to the Internet and mobile devices — perfect for viewing during a boring history lecture or on the dreary commute home on the 5:07 to Ronkonkoma.

Easily masticated comedy — plus a fervent audience of college kids in baggy cargo shorts bursting with disposable income and electronics — also made MacFarlane a natural fit for Google. In September, the first of 50 bizarro animated shorts by MacFarlane appeared online. Seth MacFarlane’s “Cavalcade of Cartoon Comedy,” distributed by Google via its AdSense network, is a series of Webisodes that MacFarlane describes as edgier versions of New Yorker cartoons come to life. Running from 30 seconds to just over two minutes, the shorts are sponsored by advertisers and noteworthy for a host of reasons. For fans, they are MacFarlane’s first non-TV venture and so exist outside the reach of censors and network suits and introduce a universe of entirely new characters. For the entertainment industry, they mark the first experiments with a bold new method of content distribution (and the entry of the beast Google into its world). This purportedly unsophisticated hack comic now finds himself, in some ways by accident, at the intersection of advertising, television, and the Web — all of which are blurring together.

Perhaps it’s not surprising, then, that while a MacFarlane product like Family Guy may seem slapdash when you’re watching it, the creative process behind it is decidedly sophisticated. “He’s kind of a modern-day cross between George Lucas and Norman Lear,” says his manager, John Jacobs. “He thinks on a big canvas.”

Says Norman Lear himself, a man who was once also the highest-paid creator on TV: “I’m crazy about him and his work. I can’t think of anybody doing a better job right now of mining the foolishness of the human condition.”

*****

A Family Guy episode is more or less a nine-month undertaking, from first script to finished animation. All episodes take shape in the writers room on the third floor of an unremarkable office building on Wilshire Boulevard, home to MacFarlane’s Fuzzy Door Productions. It’s pretty much as you’d imagine: a conference table surrounded by rolling chairs and covered in computer monitors, action figures, and the assorted detritus of the comedy writer’s diet: soft-drink cans, candy wrappers, half-finished bags of beef jerky. MacFarlane takes a chair in front of a dry-erase board as his 16 writers stagger in drinking coffee and stabbing at cups of fruit. One of them asks the boss how a concert he’d seen the night before had gone, and when MacFarlane complains about the bathroom lines, the guy suggests he stick to “lesbian shows, like the Indigo Girls.”

The typical episode begins with a single writer producing a script, but then the whole team gets involved, dissecting each scene and line to decide if a) it’s actually funny and b) it can be made funnier. In a loose but laborious process, each gag gets chewed over ad infinitum in this peanut-gallery forum. The goal is to produce an episode overstuffed with jokes — something that gives fans plenty to discuss late at night on bulletin boards. “I think we’re the most joke-per-minute show on television,” asserts executive producer David Goodman.

This late-summer afternoon, the challenge is to fill out a scene in which Stewie and some friends are at nursery school. Ideas are tossed out in various impressions of Stewie’s voice: There’s a molestation joke, some poop jokes, a joke about a rogue chicken because, according to the writer who pitches it, “chickens just wander around the yard at some schools.”

“Is that safe?” MacFarlane asks. “Aren’t chickens aggressive and, like, poke your eyes out?”

Anyone can speak, and jokes are called out with no introduction. MacFarlane sits up front, along with Goodman, reclining in his seat and appearing in no way dictatorial. He’ll chime in, but his input seems no more or less important than anyone else’s. “If the writers in that room don’t laugh — it’s not going on,” says Goodman. “That’s a tough room. If we laugh, it’s probably funny.”

The prevailing meta-joke about Stewie is that, despite being an infant, he is the most intellectual character on the show, even if the only family member who can hear him speak is Brian the dog.

“Stewie could wear a cop hat and go up to a white girl standing with a black kid and say, ‘Are you okay, miss?’ ” one writer suggests.

Awkward, almost embarrassed laughs break out around the table. It’s a joke that could be viewed as offensive, or as fairly pointed social criticism. A digression on race follows, before everyone moves on to another idea, about toddlers as obnoxious art critics picking apart one another’s finger paintings.

There isn’t a comedy writers room in America where the banter doesn’t often veer toward extreme subjects. The difference with this crew is that the extremes are the goal. Watch enough Family Guy and you’ll almost certainly see something that makes you cringe; it might not offend you personally, but you can imagine how someone won’t find it funny. Family Guy savages politicians and celebrities, and is more than willing to tackle all manner of touchy subjects in the name of comedy — race, Islam, Christianity (Jesus is a recurring character, because FCC rules stipulate you cannot use “Jesus Christ” as an exclamation unless the deity himself is present), homosexuality, bestiality, pedophilia, the physically impaired. A favorite example tossed out by opponents is a sight gag that involved a JFK Pez dispenser in which the candy emerged from a hole in the president’s head. (MacFarlane later admitted that maybe, just maybe, that one crossed the line.)

MacFarlane doesn’t argue with the notion that many of his jokes border on offensive, but the notion that the content is actually offensive irks him. Each episode is vetted by a team of Fox censors editing with the FCC in mind. But beyond that, he contends, “There’s an enormous amount of self-policing that goes on and a lot of intelligent conversations about whether a show is worth doing. I would stack the ethics of one of my writers up against the average Washington bureaucrat on censorship any day.” MacFarlane is mystified in particular by the two things that most upset the FCC — two basic elements of human life that, in his view, are far less sensitive than, say, religion. “For the FCC, it’s sexual references,” he says. “But even more than that, shit jokes. Any time we even show somebody on a toilet, we get in trouble.”

MacFarlane doesn’t argue with the notion that his jokes border on offensive. But the notion that they are actually offensive irks him.

Which brings us back to the writers room. A source of ongoing consternation is Stewie’s inability to master the commode. MacFarlane assumes the child’s erudite voice and says, speaking in character to his fellow children, “I’d like to make an announcement: It’s the elephant in the room. I made a stool. Now let’s just all go about our business as if nothing happened, and it’ll take care of itself in due time.”

Most everyone in the room laughs. The joke is in.

*****

Seth MacFarlane was basically fated to this life. His middle name, Woodbury, was chosen by his mother as an homage to the town drunk back in Kent, Connecticut. “Some of the foulest jokes I’ve ever heard,” he has said, “came from my mother.” MacFarlane started drawing at 2 and published his first cartoon, “Walter Crouton,” in a local paper at the age of 8. At 18, he left for the Rhode Island School of Design and, after his adviser sent his thesis film, “Life of Larry” (starring a lovable schlub with a tolerant wife and a talking dog), off to Hanna-Barbera, he was hired to work as an animator and writer on shows like Dexter’s Laboratory and Johnny Bravo. In 1996, he created a sequel to “Life of Larry” that aired in prime time on the Cartoon Network. Fox development executives took notice and hired him away to work on interstitials to run between sketches on Mad TV.

A few years later, Fox asked MacFarlane, then 25, to develop an animated pilot, giving him a scant $50,000 to do it. MacFarlane emerged three months later with a nearly completed pilot, for which he had drawn every frame and voiced every character.

Fox bought the show, gave MacFarlane a reported $2-million-per-season contract, and premiered Family Guy in the highest-profile slot possible, following the 1999 Super Bowl. He was the youngest person ever to be given his own primetime network show.

It drew 22 million viewers but then became a sort of network foster child. For the next two years, Fox execs moved the show all over the schedule, trying it in 11 time slots, including in the death zone opposite Friends. Despite the fact that Family Guy tracked well with young men, the show’s ratings were low. Fox canceled it in 2000, revived it briefly the next year, then canceled it again.

But a funny thing happened. The show lived on over at the Cartoon Network, with even edgier versions specially edited by MacFarlane. Regard for the show was so low that Fox essentially gave the Cartoon Network the first 50 episodes for free; Fox simply asked for promotion of the show’s DVD in exchange. (They were having trouble persuading retailers to stock it — another in a list of miscalculations that seems inconceivable in retrospect.) Family Guy’s audience, ignored at every turn, followed the show to the Cartoon Network, dug in, and swelled, regularly beating both Letterman and Leno in the desirable young-male demographic. When Fox released the first 28 episodes on a series of DVDs in 2003, it sold more than 2.5 million copies. (In 2005, a straight-to-DVD movie called Stewie Griffin: The Untold Story sold about 3.5 million copies, bringing in almost $80 million.)

Twentieth Century Fox TV president Gary Newman (now chairman) summoned MacFarlane to his office in 2004 and did the unthinkable: He asked him to restart production. “I had gone into the meeting not knowing why I was going in there,” MacFarlane recalls. “He said, ‘We’d like to put this back into production,’ and I almost fell out of my chair.”

David Goodman says that when Family Guy was initially canceled, MacFarlane told him Goodman’s job would be safe if it ever returned. “I’d been on 14 canceled TV shows,” Goodman recalls. “They never come back. It’s never happened before — ever.”

Fox brought the show back in a big way, ordering 35 episodes (22 is typical) and handing over the Sunday-at-9 slot, where it boomed. The 100th episode aired in November of 2007, pushing the show into syndication. Though schedules vary, Family Guy airs up to 27 times a week in a single market, with reruns on Fox, TBS, the Cartoon Network, and in 20 major markets on channels owned by Tribune Broadcasting.

“Animation is something that, if it works, it’s more profitable for a studio than any other show,” MacFarlane says. People don’t buy Everybody Loves Raymond T-shirts, but they do buy shirts bearing the devious visage of Stewie, as well as action figures, stickers, posters, and video games. Increasingly, they also buy song clips and ring tones. And Fox, which owns the show, also owns the intellectual property (but kicks a percentage of sales back to MacFarlane). Reports have valued the Family Guy franchise at as much as $1 billion. Though neither Fox nor MacFarlane’s team would confirm that number, a little back-of-the-envelope math indicates that it is overly conservative. At a reported $2 million per episode, Family Guy has garnered at least $400 million up front from syndication. DVD sales have totaled almost another $400 million, while 80 licensees have contributed at least $200 million from sales of various clothing and baubles, actual and digital. Fox’s ad revenue off Family Guy can be estimated at at least $500 million over the years. “Suffice it to say, with it being a studio-owned show, and being on the Fox network, it’s of substantial value,” Newman told me. And none of this figures in revenue from MacFarlane’s other hit product, American Dad.

Team MacFarlane, of course, also recognized the value of what MacFarlane has brought to the network. By the time negotiations on a new contract began more than two years ago, the challenge for both sides was how to put a number on MacFarlane’s worth, considering that he isn’t just a writer-producer but also an animator and actor. MacFarlane’s team felt the need to let his contract expire, “to have him on the open market,” explains one of his representatives. For more than two years, MacFarlane worked on Family Guy in good faith, without a contract. “There were a couple days when I was ’sick,’ ” MacFarlane says. “At times, that helps bring the negotiations back when they’re stalled.”

When the writers strike broke out last year, he sided with the guild and walked off the set. Fox decided to go forward and edit episodes without MacFarlane’s participation — they did own them, after all. MacFarlane called it a “colossal dick move.” When asked about it now, he says it’s a sore that’s been salved ($100 million has a way of doing that). “They gave us money to go back and edit the shows the way we wanted, and we made nice.”

One Fox-inflicted bruise that has yet to fade involves shots taken at Family Guy by The Simpsons, a show that MacFarlane says he admires greatly. Most famously, in an episode called “Treehouse of Horror,” Homer creates a sea of clones even dumber and more dim-witted than himself. One of these is Family Guy’s Peter Griffin. MacFarlane decided to return fire. He wrote a joke in which Peter’s perverted friend Quagmire attacks and molests Marge Simpson. Fox, he says, nixed the idea. “They said, ‘We want the feuds to end.’ I thought it was very conspicuous that this came about only when we decided to hit them back.”

What did he do? He left it in anyway, and delivered the edit to Fox, which then edited it out. “It’s still a sore point,” MacFarlane says. “It’s still this wound that has never quite healed that says, ‘We don’t value you quite as much,’ which I can’t imagine is true, but …” The thought trails off and, perhaps realizing that it’s best not to follow this logic, he turns a corner. “To be fair to Fox — for the most part, creatively they have been a very easy company to work with. This was kind of a rare lapse in judgment.”

*****

MacFarlane’s contract hiatus didn’t just buy him leverage with Fox; it was an expansion opportunity. While the studio was noodling on the deal, MacFarlane’s management team went out and signed him up with Google. The resulting “Cavalcade of Cartoon Comedy” is outside the bounds of the Fox relationship. “In a completely perfect world,” Dana Walden, chairman of 20th Century Fox Television, has said, “he wouldn’t be able to do that.”

He did. The idea stemmed from conversations between MacFarlane’s lawyer and agent and representatives of Media Rights Capital, an L.A.-based multimedia financier. Loosely tied to the talent agency Endeavor (which reps MacFarlane, naturally), MRC partners with content creators — whether that’s director Alejandro González Iñárritu on Babel; or Sacha Baron Cohen on his next film, Bruno; or MacFarlane — giving them funding and a share in ownership, plus creative control.

MacFarlane produced the Cavalcade shorts with a team of six writers. The animation is instantly recognizable as his, as is the humor. The shorts lean heavily on pop culture (say, “Fred and Barney Try to Get Into a Club,” which is fairly self-explanatory); they’re rude (in one, Tara Reid’s grotesque belly flab talks); and of course, they’re crude (a boy is told he is adopted by two parents with nipples that stick out of their chests like javelins; his name, they tell him, is not Michael Sticknipples but rather Albert Horsefeet Turdsneeze — whereupon the boy sneezes a turd that sprouts horse feet and gallops off).

The Cavalcade shorts are also distributed in an innovative way: targeting young males where they lurk by popping up in ad windows on sites such as Maxim.com and Fandango.com (while simultaneously appearing on YouTube). “The idea is not to drive someone to a Web site but to make content available wherever the audience will be,” explains Dan Goodman, president of digital at MRC.

Also unprecedented is the way MacFarlane is being paid. MRC is not Fox; it can’t just write him a nine-figure check. Instead, MacFarlane’s status as an equity partner in the deal entitles him to split the ad revenue with Google and MRC. Because the whole idea is new, it’s hard to draw parallels to current entertainment and marketing models but, essentially, MRC provides the funding and sells the ad partnerships, MacFarlane provides the content, and Google serves as distribution outlet, providing the “broadcast” via its AdSense network. Then all three split the proceeds. It can, and will, be replicated with other content providers. Already, MRC is working with the Disney Channel’s Raven-Symoné on kids-targeted programming. You could easily imagine it with, say, Rachael Ray.

Each Cavalcade short carries a single advertiser. The first 10 were bought by Burger King, and — in yet another unprecedented move — MacFarlane animated the company’s ads for them. It’s an option available to any of the sponsors if they choose to pay extra for it.

For Burger King, the appeal was obvious. “Seth’s fan base intersects squarely with our audience of young men and women,” says Brian Gies, vice president of marketing impact for Burger King. In other words, MacFarlane’s comedy provides a very powerful and friendly connection to a very targeted audience, one that tends to get the munchies. Says Google’s Levy: “We know where to find them, and we’re putting the advertising in an environment they’re comfortable in.”

“The idea is to take the TV experience and provide it on the Web,” says Alex Levy, Google’s director of branded entertainment. “But brought to the people you want to reach, when, where, and how you want to reach them.” For a company that likes to say it’s not in the content business, that’s a remarkable statement. Google, in essence, is trying to use its ad-distribution network to turn content distribution upside down. (Google calls it the Content Network.)

There’s no guarantee the new model is going to stick, of course — advertisers could decide they get as much value by just buying regular Web ads and avoid paying extra. But early returns showed viewers were responding well to the shorts. In its first days, Cavalcade was the most-watched channel on YouTube, and the videos racked up 5.5 million views across the various sites running them. And MacFarlane wins no matter what. Unlike his Family Guy characters, every horny frog and lusty princess and sarcastic talking bear created for Cavalcade is owned by him, and can be deployed for future revenue. And for all this, he has zero financial risk.

*****

A couple of years ago, MacFarlane nearly worked himself to death. He collapsed at his desk and was rushed to the hospital. He was sick, he says, and “didn’t have the time to stop.” So he passed out right there under the Sound of Music poster. He ended up spending, as he tells it, “a lovely afternoon at the emergency room.”

“We’ve been behind schedule on Family Guy since day one,” he explains. “In reality, you can’t do a prime-time animated show in the time allotted, so that always puts a glaze of stress over the whole process.” He takes a breath. “I refuse to let that control my life. I did that in my twenties. Now I insist on a balance.”

MacFarlane has handed off the day-to-day control of both American Dad and The Cleveland Show, and he is increasingly delegating on Family Guy. He reviews all the drawings and obsesses more than a little over the music — there is some stuff he just can’t give up. And what’s easy to forget is that MacFarlane is also the star of Family Guy. Actually, several stars of Family Guy. He voices three of the six main characters, and is in virtually every scene, sometimes playing several parts at once. He’s also the voice of Quagmire, a major secondary player, and hundreds of ancillary characters and one-timers. And, of course, he’s the voice of Stan, the lead on American Dad, and almost certain to guest-star often on The Cleveland Show. This summer, he showed up as a voice actor in Guillermo del Toro’s Hellboy II and is very soon planning to step in front of the camera in live-action projects. He also intends to direct movies.

One afternoon in August, MacFarlane and two sound engineers are in the tiny control room outside the recording booths in the Family Guy offices. In strolls the actor Gary Cole wearing shorts and sunglasses. For a show that likes to pick on celebrities, Family Guy has little trouble attracting them, especially those whose résumés include the kind of wonderfully awful performances that ultimately get embraced as cult in-jokes: Drew Barrymore, Haley Joel Osment, Gene Simmons, Bob Costas, Phyllis Diller … Michael Clarke Duncan was in earlier this morning. Richard Dreyfuss is due to arrive this evening.

Cole has done the show 23 times. Today, he’s doing Mike Brady, reprising a role he played in The Brady Bunch Movie. In this script, Mr. Brady is verbally abusing Mrs. Brady in one of those trademark pop-culture tangents.

“You know, you can really go as loud as you want,” MacFarlane says in director mode. “We’ve never heard Mike Brady yell before, so this is new territory.” He then assumes the role of Carol Brady.

“Huh, I don’t remember asking for a warm beer,” Cole says, his voice quiet but seething.

MacFarlane, as Carol, flips out: “I didn’t want to quit working — you made me!”

Five minutes later, Cole exits and MacFarlane is off to the next thing, laying down lines in furious fashion, typically in three or four takes, which he then selects from on the fly. His sound engineers tag his favorite takes and move on. He swaps from voicing Stewie to Peter to Quagmire to various odd parts, including a bit as Paul McCartney and another as Vince Vaughn.

Next up: A writer is doing Patrick Swayze, who is not, as you might expect, the butt of a cancer joke, but rather a tight-jeans joke followed by repeated takes of the writer growling, as throaty redneck Swayze, “Roadhouse!” It’s another one of those cult jokes, a little snippet of Dada theater.

“Even a hair more badass,” MacFarlane directs, and over and over they go until that one simple word becomes absurd in its own right. You can already hear it as a ring tone.

[via FastCompany] by Josh Dean

Here’s someone you need to meet. Seth Gordon, Managing Partner @ Gordon|Diaz-Balart.

Seth Gordon brings over thirty years of intensive local market experience in community relations, economic development, and corporate relations to Gordon|Diaz-Balart, widely known as the “Miami Relations Firm” for their ability to help clients succeed in the complex and rapidly changing Miami market.

In addition, Seth is an active aggregator of like-minded people. He established the TUESDAY NETWORK, a pioneering networking organization for Florida’s and Latin America’s emerging entrepreneurial technology sectors in the late 1990’s. More recently, Seth has been active with MiamiLink.org, a locally-focused analogue of Linkedin.com. Seth is also an active political adviser and expert fund raiser for wide range of candidates (including his former business partner U.S. Congressman Mario Diaz-Balart).

Prior to his partnership with Tia Diaz-Balart, Seth was partner with Jami Reyes in Gordon Reyes & Co., a Miami-based marketing, public affairs and communications consulting firm established in 1989.

Gordon previously was associated with the statewide public affairs consulting firm, Chiles Communications. Prior to that, he was Senior Vice President Public Affairs for Citicorp Florida where he was responsible for public relations, community involvement and governmental affairs and marketing support activities on behalf of Citicorp’s ten Florida-based businesses.

For five years prior to Citibank/Citicorp, Gordon was Vice President for Public Affairs of the Greater Miami Chamber of Commerce. He remains active with the Chamber, currently serving as head of the Entertainment & Media Group and member of the Board of Directors.

Gordon earlier served as Tallahassee lobbyist for Metropolitan Dade County and in several capacities in Florida State government including Executive Assistant to the Attorney General, Executive Assistant to the Senate President Pro Temp, and Legislative Analyst for the Senate Committees on Governmental Operations and Health & Rehabilitative Services.

Gordon is and has been involved in a wide array of civic organizations including:

ARTS:

City of Miami Arts & Entertainment Council, founding chairman

New World School of the Arts, founding chairman

Performing Arts Center Foundation, founding member

Florida Philharmonic, board of directors

Miami Arts Exchange, founder/chairman

The Rhythm Foundation, board

Performing Arts Network (PAN), board

ENTERTAINMENT

Miami Film Festival, chairman

Florida Entertainment Commission, chairman

Entertainment Group, One Community/One Goal, co-chairman

BUSINESS & CIVIC

Greater Miami Chamber of Commerce, Board of Directors

South Florida Coordinating Council, President

Beacon Council (Greater Miami’s economic development agency), board member

Dade Public Education Fund, president

Gordon received his AA degree from Miami-Dade Community College in 1971, attended Boston University, Florida State University and received his Bachelor of Arts degree from Florida International University in 1974.

http://www.gd-b.com

[via UrbanLandInstitute, Linkedin]

When Amy Loera was looking for a loan to expand her family’s Mexican-restaurant business earlier this year, she applied at nine different banks. They all turned her down.

Many of the banks accepted her initial application but simply didn’t take things any further, she says. Some raised concerns about the nationwide downturn in the restaurant industry in refusing her request. And some told her that if she had applied a year ago, she would have had no problem.

So Ms. Loera turned to a local lender, Arrowhead Credit Union in San Bernardino, Calif., after a business acquaintance told her the credit union had given loans to other businesses in the community. She was approved for a $643,000 loan this summer.

Ms. Loera, who runs the restaurant chain, Tio’s Mexican, with her husband and brother-in-law, believes that since Arrowhead was based in the region, it was easier for her to make a stronger case about the health of her business.

“They were local,” she says. So “they were able to see that because we are a family-owned restaurant and because we had a very good formula to keep our overhead [costs] low and prices reasonable, we are picking up the slack from [fancier restaurants] around us and are not feeling a big hit from the current economic situation.”

Small businesses have been having increasing trouble getting loans as the credit markets have seized up. But some, such as Tio’s Mexican, are finding that smaller community banks and credit unions are more open to offering financing. For one thing, many smaller lenders are in relatively strong financial shape because they didn’t make the types of investments that got many of their larger brethren in trouble.

In addition, private local lenders may be more familiar with a region’s business climate, so they are better able to look beyond national trends to base their decisions on the more immediate factors affecting an individual business.

“Often times,” says Sandy Baruah, acting administrator of the Small Business Administration, “the larger institutions will rely more heavily on the credit score, whereas sometimes community banks will take a much closer look at the business plan. And especially if they are based in the region or the community, they will make a decision based on their overall comfort with the business plan and presentation.”

” But still, credit ratings matter,” Mr. Baruah says.

When applying for loans, Ms. Loera says she highlighted the fact that her restaurants are based in so-called bedroom communities like Rancho Cucamonga, Calif. — where people commute some distance to work, are strapped for time, and look for a place where they can eat an affordable family meal at the end of the day.

She presented a three-inch-thick binder filled with financial statements showing the historical results of the company’s existing restaurants as well as the fact that they were debt-free. The Loeras had credit ratings in the 750 range, she says.

She also gave a projection of how much money the new restaurant would bring in over the first 12 months, and a business plan that included details such as the number of employees the new location would have and the intended menu.

Ms. Loera says all that data didn’t affect the decision of the banks — but it did Arrowhead’s.

Jon Parks, a vice president at Arrowhead, says the credit union approved Ms. Loera’s application because the family showed they already had experience managing restaurants and were able to prove that their existing locations were financially successful.

The fact that the new eating place is being planned as an affordable family restaurant makes it more likely to succeed in the current economic environment, he says.

“We are not score-driven in the business-lending side, and choose to look behind the scenes,” Mr. Parks says.

He says a strong credit score — one above 700 — can be helpful. But the one metric that often trumps all others is cash flow. Since it indicates the amount of cash generated and used by a business over a certain time frame, it can be a key indicator of a borrower’s ability to pay back the loan.

Lenders also try to gauge how a small business will do going forward. Heath Chapman, vice president, commercial banking at Morrill & Janes Bank in Merriam, Kan., which is still lending to small businesses, says companies increase their chances of getting a loan if they give financial forecasts that look realistic.

He suggests that owners include a best- and worst-case scenario for their revenue projects and for forecasts on how they will repay the loan.

For a banker, “having all those questions already answered helps,” he says.

Certain industries that have been particularly hard hit by the weakening economy may face added pressure to prove that their earnings are strong enough to withstand the downturn. But institutions that are still lending to small businesses tend to take each application on a case by case basis.

“Those industries that have been hit the worst — construction, auto dealerships — we are going to look at with a logical eye and understand what we are up against the next 12 to 18 months,” in terms of the outlook for the overall industry, says Mr. Parks.

“It doesn’t mean we are not going to lend to them if the numbers dictate and everything makes sense,” Mr. Parks says.

He believes there could be pockets or individual businesses that continue to do well even within such sectors because they have some kind of a niche offering.

Some community lenders aren’t completely dismissing even those businesses that face some financial hiccups. Mr. Chapman says he is asking small-business clients to come to him as soon as possible with financial problems or difficulty funding losses.

He says he is willing to consider lending to small businesses that face some difficulties if they have a history of overcoming problems in the past.

[via WSJ Small Business] By Anjali Cordeiro

Saleen Automotive is the latest American carmaker to announce that it is seeking a potential buyer, with management acknowledging the firm has suffered financially from the economic downturn and rising fuel prices.
Saleen is a specialty vehicle manufacturer and a long-time tuner Ford tuner, and most recently unveiled its own concept vehicle, the Raptor S5S. The company has close links with both Chrysler and Ford, and is responsible for part of the assembly of some of the Detroit carmaker’s limited production vehicles.

According to Automotive News, Saleen’s board has set a tentative timetable to receive preliminary indications of interest from prospective parties over the next two months and plans on finalizing a transaction early next year. In 2004 controlling interest was sold to investment group Hancock Park Associates in an effort to raise capital, however there were reportedly a number of major conflicts within the company, mostly between the Saleen family and the new management board.

The company has faced a number of hurdles since then, having lost its founder Steve Saleen last year and CEO Paul Wilbur in August of this year. September saw additional departures of many senior officials and a freeze on production of many major product lines. Saleen has also started selling its office and factory equipment in a clearinghouse style auction, with more than 20 brand new 2008 Mustang GTs, tools, cabinets, office equipment, and factory machinery all going under the hammer recently.

[via MotorAuthority] by James Martinez