Roanoke Times
Copyright (c) 1995, Landmark Communications, Inc.
DATE: SUNDAY, January 9, 1994 TAG: 9401090083
SECTION: VIRGINIA PAGE: D5 EDITION: METRO
SOURCE: The Washington Times
DATELINE: HERNDON LENGTH: Medium
Fred Krazeise's 2-year-old Herndon company is recruiting customers for a service based on fleets of satellites that will not be launched until this spring at the earliest.
That has not stopped investors - including Krazeise and 14 employees - from sinking $1 million into GDI's system for tracking cargo locations from space. So far, GDI has made less than half that amount in revenue, but he expects sales to pick up after some satellite launches planned this year.
"As far as I know, we are the only company that exists solely to resell these satellite services and add value to them," Krazeise said. So the company is a hostage to satellite launch schedules, which have been pushed back while the satellite systems raise money and obtain licenses. The first system, Orbcomm, is supposed to begin operating this summer.
Two trucking fleet owners recently wrapped up six-month demonstrations with GDI, using limited service provided by government-owned satellites. At least one of the firms, Menasha Transport Inc., wants to try again when the finished product is ready.
"We were pleased with the technology. We thought it would work," said William Levenhagen, Menasha Transport's sales and marketing representative. "But a full-scale operation will be the true test."
Menasha Transport is owned by Wisconsin-based box maker Menasha Corp. It operates about 400 truck-trailers, used to haul 5,000-pound rolls of corrugated packaging material to Menasha plants throughout Michigan, Wisconsin and Illinois. A single tractor may drop off three different trailers per day, making the cargo hard to keep track of.
The GDI system puts a small transmitter in each trailer. Its signal is relayed to orbiting satellites, then to receivers on the ground, and routed to GDI's operations center in Chicago. GDI takes the information, makes sense of it, and sends reports to the customer by fax or electronic mail.
GDI has agreements to use the satellite and receiver networks planned by a pair of Washington-area firms: Starsys Global Positioning Inc., a joint venture owned by Lanham, Md.-based Hughes STX and the French firm CLS; and Orbcomm, a subsidiary of the Fairfax-based Orbital Sciences Corp.
Companies like GDI, which develop practical applications, will be very important for making the satellite networks pay off, Starsys business development director Stephen Morgan said.
Except for a small stake bought by outside investors through a private placement, GDI is owned by its employees. Krazeise, 40, said he owns about 15 percent and has sunk in $100,000.
GDI has made some missteps, Krazeise said. Most were along the lines of not delivering products to customers as fast as they wanted.
On the plus side was the decision to set up shop in the Virginia Space Incubator Program at the Center for Innovative Technology, a location that brings with it a high profile and helpful aid from George Mason University, he said. Trade-press coverage was a big help, too, bringing GDI to the attention of Menasha and other clients.
by CNB