Page 7
July 20, 2006
Spíly^y Tyrooo, Warm Springs, Oregon
Software company sees results after working with Ventures
B y M aren Cohn
Warm Springs Ventures
Recent events at Bend-based
Cort Software are encouraging
its p aren t com pany, W arm
Springs Ventures, to forecast a
profitable year for the subsid
iary.
Ventures CFO Jeff Anspach
says that Cort is reporting dras
tically improved results over last
year. “We’re very excited about
their prospects,” Anspach says.
“With a new release of its hu
man resources software almost
ready, Cort is poised to bring
financial benefit to the Confed
erated Tribes.”
This news marks an impor
tant turnaround at Cort, which
Ventures acquired in 2003 after
several years o f flat sales and
ineffective management.
Early efforts under Ventures
to increase revenues and reverse
sales trends made some im
provements, but did not suffi
ciently address core issues.
After funding Cort losses for
two years, Ventures grew rest
less about continuing its support
and contemplated selling it off
in 2005.
When the Tribal Council de
cided to restructure Ventures
late last summer, it made ad
dressing the situation at Cort a
major priority.
V en tures’ new lead ersh ip
team, led by Clyde Hamstreet,
tackled the issue. “The way we
looked at it,” says Hamstreet,
“We could either sell Cort right
away at its current value, man
age the slow liquidation of the
company without attempting to
restructure it, or restructure it
to build value and then sell it at
a much higher price.”
A fter careful assessm ent,
V entures recom m ended the
third alternative.
“ S ellin g C ort last year
wouldn’t have brought in much
money,” Hamstreet says. “Cort
didn’t score well in the three
criteria that determine the price
a buyer is likely to pay for a soft
ware company like Cort.”
He continued, “Its software
didn’t meet current web-based
standards, revenues were not
growing and most importantly
the company was losing money.”
“At the same time, Cort had
a lot of potential, which made
the op tion o f restru ctu rin g
much more attractive than a
m anaged
liq u id a tio n ,”
Hamstreet added.
Nevertheless, the restructur
ing task posed a challenge.
The Tribal Council made it
clear that Warm Springs would
not continue to fund Cort’s op
erations.
Several factors contributed
to V entures’ assessm ent that
Cort was well worth this effort.
Starting out 30 years ago with
a unique and powerful payroll
product, Cort had built up a
strong brand image, loyal cus
tomer base, and a solid reputa
tion.
It was on the verge o f clos
ing its largest sale ever, and had
plans to develop a promising new
web-based human capital man
agement product.
“The m arket for w hat we
offer is huge,” says Cort presi
dent Gary Lawrence. “Every
company out there needs pay
roll and human resources func
tionality of some kind, and our
focus is on a giant segment of
that m arket, companies with
between 200 and 10,000 em
ployees.”
“T he o p p o rtu n ities for
growth are trem endous, and
Cort was already w orking to
capitalize on them,” he added.
Lawrence’s presence at Cort’s
helm was another reason for
Ventures’ confidence in moving
forward with the restructuring.
H ired d u rin g the fall o f
2005, Lawrence brought vision
and discipline to the flagging
company.
Under his leadership, Cort
closed the prospective sale and
attracted an investment partner,
Jim Cajacob o f Inform ation
Concepts, Inc., to share in de
veloping the new w eb-based
product.
“M aking that sale and at
tracting the development part
ner were key factors to us in
deciding what to do with Cort,”
says Anspach, who spent six
weeks last fall assessing the com
pany and helping to design the
reorganization.
“W ithout that infusion of
outside capital, I’m not sure we
would have gone forward,” he
added.
The restructuring plan pre
sented last December limits Ven
tures contributions to the com
pany in 2006 to u nder
$100,000, and req uires that
Cort show positive financial
numbers during the year.
Cort was required to cut its
costs drastically while develop
ing the new web-based product.
Cort m anagem ent has ap
plied this strategy vigorously.
Led by Lawrence, the com
pany reduced staff by 40 per
cent. It reshaped its sales and
Issue of casino dicussed in
governor candidates, debate
W E LC H E S (AP) - Gov.
Ted K ulongoski and GOP ri
val Ron Saxton scrapped last
week over some o f the most
contentious issues facing the
state - including the Columbia
gorge casino, proposed govern
m ent spending lim it, and re
form s to the state em ployee
pension system.
In the first face-to-face de
bate between the two leading
g u b e rn ato rial
can d id ates,
Kulongoski portrayed Saxton as
a tool o f corporate interests,
w hile Saxton shot back that
Kulongoski is a weak governor
who wants to raise Oregonians’
taxes.
Both used the occasion to
try to define K ulongoski for
voters.
Kulongoski said he’s always
fought for working families, the
e ld e rly and the needy. He
charged that Saxton, a Portland
lawyer, has catered more to cor
porate interests, as evidenced by
his opposition to tougher auto
tailpipe emissions standards and
moves to rein in payday loan
shops.
Saxton, calling the election a
referendum on K ulongoski’s
performance in office, sought
to portray the incumbent as a
“status quo” figure whose re
rm
iän
sponse to all problems has been
to try to raise taxes and to pro
pose canceling Oregonians’ in
come tax “kicker” refunds.
In th eir ho urlo n g debate
sponsored by the Oregon News
paper Publishers Association,
the two clashed over an initia
tive m easu re aim ed at this
November’s ballot to clamp a
tight new spending limit on state
government.
Kulongoski said the measure
would make it impossible to pro
v id e ad eq u ate fu n d in g for
schools or to put more Oregon
State Police troopers out on the
h igh w ays to p ro tect p u b lic
safety.
“It would be a stranglehold
on the state,” he said.
Saxton, while saying he didn’t
plan to actively campaign for the
measure, said state government
has plenty o f revenue already
and that state officials simply
have to be more efficient with
taxpayer dollars.
“We have a serious money
management problem ,” not a
revenue shortage, Saxton said.
copies o f pay stubs, see how
much vacation time they have
left, or manage their 40Iks,” he
says.
Lawrence notes that Cort’s
flexibility' in tailoring its product
to cu sto m er req u irem en ts
makes its software ideal for na
tive nations in tracking and man
aging membership data.
The Confederated Tribes is
one of his company’s many cus
tomers.
P rofessional sports team s
offer another good example of
what Cort’s software can do.
“We have NFL teams on our
customer list,” Lawrence says.
“Every time a team plays, the
host city and/or state taxes the
p layers for the m oney they
make there. And ever}7 city and
state is different in how it struc
tures those taxes and calculates
the amounts.”
“Our product handles all that
and saves the adm inistrative
staff a lot of headaches,” he
says.
Cort products assist sports
organizations in other ways as
w ell. The D enver Broncos,
B uffalo B ills, and St. Louis
Rams all use Cort products.
Over the past six months, the
Ventures team has helped Cort
take major strides forward in
continuing to provide its distinc
tive service to customers.
“I’ve been very pleased with
the way Cort is responding to
our re stru ctu rin g , e ffo rts,”
Hamstreet says. “We still have
much work to do before we can
claim success, but w e’ve come
a long way with Cort.”
“I expect the value o f the
Tribes’ investments in the com
pany to grow significantly over
the next year,” he said.
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Tribes’ casino plan
On the gorge casino topic,
Saxton said that as governor, he
would not approve a move by
the C o n fed erated T ribes o f
Springs M àrktf
ArCs
C n ä ràfis
2132 Wärm Springs St-
Wärm Springs, 02 97T61
($41) S53-1597
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in the Spilyay Tymoo is Friday, 28. Thank you.
}■
,JVarm Springs to build a casino
on off-reservation land in Cas
cade Locks.
Saxton also said the state has
become addicted to lottery rev
enue to fund schools and other
programs, and that he would
oppose any expansion o f the
lottery.
Kulongoski noted that the
lottery now raises $1 billion for
schools and other program s,
money that has helped replace
revenue schools lost when vot
ers cut property taxes.
The D em ocratic governor
said he intends to allow the
Warm Springs tribe to put a ca
sino in Cascade Locks because
otherwise the tribe might build
a casino on a far less desirable
site on tribal land upstream in
Hood River.
marketing approach and man
aged day-to-day costs aggres
sively, thereby lowering costs to
the breakeven point.
Meanwhile, the software de
velopment has proceeded for
ward and the product is slated
for release later this summer.
The new release will continue
to offer the flexibility Cort is
known for, w hile answ ering
market demands for increased
functionality and the ability to
perform operations online. The
goal is to make existing web-in
terfaced products more truly
web-based.
“Employers want to be able
to advertise jobs and manage
ap p lican t pools o n lin e ,”
Lawrence explains.
“They want to track employ
ees through hiring and training
all the way to retirement. The
system serves workers, too, who
can go online to file W-4s, get
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