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Generation of Wealth

ISBN: 9781935666639
Binding: paperback
Author: Donald M. Hall
Pages: 274
Trim: 6 x 9 inches
Published: 3/1/2014

During the 1960s an upstart Minnesota company Control Data made an enormous impact on the computer industry with the help of a handful of engineers and executives led by William Norris and Seymour Cray.

The rise of Control Data from a company selling stock at $1 a share to a multi-national firm manufacturing the world's fastest computers is an extraordinary story in itself. But author Donald M. Hall also examines how the success of Control Data primed the pump of local investment and facilitated the flowering of a medical device industry that still flourishes in the state.

He follows the careers of Norris and Cray but also of Earl Bakken and Manny Villanova he describes the changing world of computer sales but also the ups and downs experienced by ordinary investors as firms producing innovative products sought out new investors willing to fund further research.

It's a brisk and fascinating read a portrait of a heady time with lessons for today's investors.


Donald M. Hall grew up in St. Cloud Minnesota attended St. John's University in Collegeville Minnesota and Marquette University in Milwaukee graduating in 1959. He worked at Control Data before moving on to a career in the brokerage industry. Now retired he lives with his wife Marion in Minneapolis.


A riveting narrative deftly painted of interesting personalities key events and how it all unfolded and continues to impact markets today. An excellent storyteller Donald Hall brings focus clarity and color to a complicated subject." - George Bonniwell former president Craig-Hallum Inc. brokerage firm

"A very engaging readable narrative describing an important economic development in both the region and the country." - John Rollwagen former Chairman and CEO of Cray Research

"Great job on the history of Control Data and the local market. Everybody from that period will love it." - Howard O'Connell former president and chairman of John Kinnard and Co. brokerage firm

"A magnificent piece of work. Fascinating." - Norbert Berg former deputy chairman of Control Data Corporation

"Very interesting. An excellent review of Control Data." - Dick Lareau senior partner at the Oppenheimer law firm former director of Control Data and member of the executive committee

"A wonderful history of local commerce." - Dr. Arnold Leonard M.D. Ph.D. former head of pediatric surgery at the University of Minnesota

The rise of Control Data from its $1-a-share days
(St. Paul Pioneer Press 05/17/2014)

"Suppose the $1 000 you invested in a local company's stock grew to $783 000 just 11 years later that the company would soon be creating thousands of good jobs in your hometown and that its rise would transform your town into a national model for entrepreneurship and innovation.

Sound like a fairy tale? It came true once upon a time in the Twin Cities. Now Don Hall meticulously tells us the story from his perspective as an employee at Control Data Corp. in St. Paul from 1964 to 1977 and his later career in the brokerage business making scores of smart bets on regional stocks. He peppers his tale of how Control Data's 1957 $1-a-share initial public offering of stock launched the Twin Cities' highly unusual "dollar stock market" with many you-are-there moments."-Dave Beal Special to the Pioneer Press

"Some books tell stories. Others trigger introspection. Don Hall's book Generation of Wealth provides not only an informative history of important Minnesota companies but also a needed perspective on how vibrant economies were created in the past and could be again."Hall recounts the emergence of Minnesota's reputable computer industry after World War II and the springboard formation of other industries involving medical devices precision manufacturing instruments and special-purpose machinery. For decades computers designed and produced in Minnesota were prominent in every national laboratory and in prestigious research facilities throughout the world. Other technical industries also gained prominence.

"Much prosperity resulted from Minnesota's emergence as a high-tech industrial powerhouse. Tens of thousands of people were employed. Houses were built. Families were sustained. Other business sectors benefited from the prosperity resulting from Minnesota's technical prominence. Two Twin Cities-based airlines flew daily flights carrying technical and managerial people to all parts of the world. Banks and financial services firms grew and flourished. Venture capital firms gained national prominence by funding more new technical firms - many of them in Minnesota.

"The prosperity was not limited to the private sector. Universities hospitals orchestras theaters and social services enjoyed the vigor of Minnesota's emerging technology-based prosperity - which also drew major league sports teams. It wasn't the other way around.

"These favorable developments seemed not to result from either diligent corporate planning or organized business strategy. Major product breakthroughs occurred quickly but haphazardly. One observer noted "Probably 80 percent of the world's usable software and equipment came together within 24 hours of a trade show."

"Hall also describes financing as different - often handled not by major financial institutions but by smaller and local "bucket shops" or by company principals selling stock to acquaintances - almost door to door.

"Even the people part was unexpected. A few people were well educated but many more were simply energetic locals with excellent "bailing wire skills." Minnesota's character as a supplier of resourceful people off the farm continued to show even during the growth years from World War II up through the mid-1970s. When the grass near Control Data's Bloomington complex appeared anemic CEO and ex-farmer Bill Norris addressed the matter simply. "Hell! Spread some manure!" It was done and the grass got greener.

"Hall's well-written story describes a period of immense wealth creation with benefits that were widespread.

"Along the way though things did change. People elsewhere learned to do what only the energetic Minnesotans had figured out. Some people retired or went on to start other companies. Leaders with high levels of firsthand technical competence gradually gave way to a more bureaucratic group - skilled in meetings but unfamiliar with technology products markets suppliers or customers. Profits declined and in some cases disappeared. With the declines of major industrial employers Minnesota changed from being stellar to near average.

"In his very detailed description of booms and busts Hall makes the thoughtful observation that even pierced bubbles have silver linings. True some of the companies most influential in Minnesota's glory years of technical achievement are no longer with us. Control Data with its 60 000 employees is gone along with Univac ComTen Data 100 and a host of others. NCS Possis ADC and much of Honeywell have been acquired and in many cases greatly downsized. Even some of the medical device companies find themselves consolidated or no longer alone with leading technologies.

"Minnesota's earlier prosperity unfolded because a cadre of daring forward-looking people attempted the accomplishment of exceedingly difficult tasks - a sound premise for prosperity.

"Minnesota now needs new science-based industries to restore the prosperity of earlier periods. There are so many world problems in need of technical accomplishment. Two billion people lack potable water. There are food shortages. Pollution is rampant worldwide.

"Fortunately Minnesota still has some fine companies involved in the solution of major problems: 3M Pentair Cargill and others. But shouldn't we be striving to create such a more robust economy again?" -- Fred Zimmermanis professor emeritus of engineering and management at the University of St. Thomas. Starting as an IBM field engineer in 1955 he served in technical and managerial positions with IBM Control Data and NCS and he has served on the boards of directors of many companies. [Minneapolis Star Tribune Business Forum: Minnesota's homegrown prosperity (March 30 2014)]

"In the October 2006 client letter I wrote a lengthy paragraph about the passing of William C. (Bill) Norris the founder of Control Data here in Minneapolis. I noted that the Twin Cities has three major economic segments which have propelled our growth over the years-food products medical technology and computer technology. The food industry I noted went back to the Pillsburys and the Bell family of General Mills medical technology to Earl Bakken of Medtronic and computer technology to Bill Norris of Control Data. You could refer to page 9 of that October &lsquo06 letter in the client letter archive on our website to read what I said then having just read it again myself I find it as interesting as when I wrote it. The founding of Control Data in 1957 really marked the beginning of an era in the Twin Cities that made history as it was unique and probably not duplicated again until the Boston Route 128 or Silicon Valley VC era many years later. All this has been laid out in compelling fashion in a new book titled Generation of Wealth by Donald M. Hall. Do yourself a favor and get this book which will be available from Amazon Barnes &amp Noble and most other booksellers by the time you read this. Let Don take you back to that time nearly 60 years ago when a few talented men in search of independence from a large bureaucratic organization called Sperry Rand started Control Data raising start-up funds without a broker sponsor at $1 per share literally door to door and with gatherings of friends like a Tupperware party. It was indeed the beginning of an era written by a man who lived through much of it. Don Hall now 76 worked as a young man as an analyst at Control Data and then for 20 years in the local securities industry. Some of you reading this will remember him from the old days of RJ Steichen a brokerage which he owned part of with the late Jack Feltl.

"But let's step back a bit. I was there too at that time. Well almost. I graduated from the University of Wisconsin with an MBA in 1956 and went to work as a securities analyst at the American National Bank and Trust Company on LaSalle Street in Chicago. That is a long story most suited for my own book someday. In early 1959 I relocated to Rochester MN as the junior member of a team managing the Mayo Foundation dollars. This was two years after the event referred to as the beginning of an era when Norris and others had raised capital to put Control Data on its way. So also was the stock on its way a subject of coffee shop talk even at the Mayo Clinic where the spectacular rise in the price of the stock was discussed almost daily because it was indeed like a rocket ship. By 1961 or so the stock had gone to $100 but ultimately adjusted for splits that $1 stock became worth well over $700 per share. Millions were made even by those who sold along the way to buy what became a very expensive car or house!

"But I digress too much. As I said I was there and lived through most of it. Company after company followed in those footsteps raising capital at $1 per share or $1.15 if there was a broker--$1 for the company and $0.15 for the broker. They were well paid imagine a 15% commission today! And on and on it went some succeeding some failing but if you lived through it as I did this is a fascinating well researched and well written book that will bring back memories. Even if you did not live through that period you will find it captivating if you let Don take you back in time to experience it as if you were there. But this book is not just about Control Data as the title suggests you will read the story of Medtronic's beginning as well as many others such as Cray Research and Possis. You will also read about our one and only Manny Villafana his successes (St. Jude) and failures (CABG Medical). As George Zimmer said with his signature slogan in the Men's Wearhouse commercial 'I guarantee you will like it.'" - Richard W. Perkins CFA President Perkins Capital Management Inc.