FlyORH: Linear Air CEO William Herp Talks Air Taxis
Thursday, February 06, 2014
William Herp, CEO of Linear Air
Traveling to Florida with JetBlue out of Boston about 6 or 7 years ago, I read JetBlue CEO David Neeleman’s book Flying High
. The whole culture and business plan of JetBlue fascinated me and I could not help but think, why Worcester Airport (ORH) could not be part of JetBlue’s future? Effective November 7, 2103, Worcester became JetBlue’s 80th city changing the entire attitude and culture at ORH.
I also learned that there is a lot more to an airport then just commercial service. General aviation is a huge business. At that time, every aviation magazine had stories about the VLJ (Very Light Jet), the latest innovation in aviation that was going to propel a new air taxi business. Many companies (Cessna Mustang, Embraer Phenom 100 and the Eclipse 500) were in a rush to produce these VLJ’s for this new industry that would enable point-to-point service-on-demand to airports with runways as short as 3,000 feet.
DayJet, based in Florida, was the leader in this new air taxi business and had ordered over 1,000 of the Eclipse 500. The sky was the limit (excuse the pun). Things did not work out and by the end of 2008, Eclipse had filed for bankruptcy and DayJet was out of business. To date, the projected demand for the VLJ and the air taxi business has never materialized.
Locally, I became aware of two companies with similar plans as DayJet, one based out of Hanscom Field called Linear Air, while former chairman of Amercian Airlines, Robert Cranndall, was behind POGO based out of Chicopee. POGO never had one flight, while Linear has not only survived but seem to be thriving This week, I would like to introduce you to William Herp, CEO of Linear Air.
A conversation with William Herp
BR: A few years back air taxi was the future of the airline business. The one most people were familiar with was the failed DayJet. What did they do wrong?
WH: Unfortunately DayJet was ahead of its time. They were attempting to aggregate passengers to circumvent the constraints of FAA regulations that prohibit selling seats on charter jets while earnestly lobbying to get the rules changed. They launched with a model promoting a lower price if travelers provided a wide window for scheduling a flight, but in fact, this was a means negotiated with the FAA to stay in compliance with the rules. DayJet would offer a lower price if you gave them a larger window in which they could ultimately schedule your flight, but the window could never be smaller than four hours, and the final time could be provided to the customers no earlier than the night before.
As a business traveler who needed to, say, get from Boca Raton to Gainesville for a meeting at a particular time, this was a very poor solution and DayJet suffered from understandably weak load factors. But they almost succeeded in getting the FAA to change the rules but for the economic meltdown of 2008, which led to the bankruptcy of their primary supplier, Eclipse Aviation, and the subsequent bankruptcy of DayJet itself and the shelving of its proposal to change the regulations on selling seats on charter jets.
[Note: this same problem has led to the inability of other shared seat models to get traction, including, most recently high profile BlackJet]
BR: The DayJet fleet was to be comprised of the Eclipse 500, which has seen some problems. You use the Eclipse 500 along with the Cirrus SR-2. Are you happy with the performance of the Eclipse 500?
WH: Yes! Our customers love the Eclipse Jet. Whereas DayJets planned to utilize the Eclipse for their per-seat aggregation model, our model was whole-plane. When Eclipse went bankrupt, we were able to restructure our business into a traditional charter model, with the Eclipse filling a niche between turboprops and larger jets.
Since emerging from bankruptcy under new owners in 2009, Eclipse Aerospace has done a very good job improving and supporting the airplane. It is very capable and offers unbeatable economic value in a twin-jet aircraft. The new company has restarted production of the airplane, calling it the Eclipse 550.
The Cirrus 22 is actually operated by partner companies, with whom we contract to provide service for our customers who come to us primarily through travel search channels such as Kayak.com and Hipmunk.com.
BR: Right now, besides the air taxi business, you have scheduled service between Boston and New York? How has that gone for you?
WH: Since launching in November, we've doubled month over month and the customer response has been overwhelming—all 10 out of 10 on our customer feedback surveys. We offer our scheduled per-seat service via Kayak.com and Hipmunk.com utilizing partner Cirrus 22 aircraft, which are not subject to the prohibition of scheduled per-seat service like charter jets are.
BR: Have you considered offering this scheduled service out of other airports; for example, ORH?
WH: We would absolutely consider scheduled service out of ORH!! Our New York/Boston scheduled service is gaining a lot of momentum. We are gathering data on what other routes our customers would find useful. As some commercial airlines are halting their regional service, there is a strong need for scheduled Air Taxi service.
In closing I would like to thank Bill and Alanna for their time for this interview. If you would like a better understanding of the Linear Air Experience watch this video, or visit price flight. Travel agents attending the Chamber of Commerce Travel Show in March should stop by and talk to Linear Air, which has committed to attend.
Bill Randell is the President of Advantage Benefits, an insurance brokerage house specializing in employee benefits with an emphasis on health insurance, based in Worcester since 1992. He can be contacted at Bill@AdvantageBenefits.com or follow him on Twitter (@FlyORH).
Related Slideshow: 13 Biggest Business Stories of 2013
Worcester’s Entrepreneurial Scene Shows Signs Of Life
GoLocalWorcester looked at how the region was capturing the cool startups and spinoffs from WPI, UMass Memorial and others. The future looks brighter than it has in years.
Back in 2001, the Worcester Venture Fund opened to great fanfare. The initial focus of the $16-million private venture-capital fund was telecom and infotech. By today’s standards, the fund’s goal was quite ambitious: Invest in up to 10 companies over a two-year period. At the time, though, it seemed like a fairly realistic goal.
But reality proved to be more difficult than originally thought. The Worcester Venture Fund made a $2-million investment in one local company and put $130,000 toward a group investment in another one. Then came the collapse of the telecom/infotech sector.
In 2003, Long River Ventures acquired Worcester Venture Fund and changed its name to Worcester Capital Partners. At the the time, they had a combined fund of $30 million. The new goal was to invest in early-stage, high-growth companies focused on technology ventures. The fund aimed to invest between $500,000 and $1.5 million in firms located throughout New England, with Worcester County as one of the regions to focus on. To avoid competition with large venture funds in metropolitan areas, the fund sought to make investments that generally fell below the threshold of the majority of venture firms and above that of individual investors.
Philanthropist Mary DeFeudis
All year we have written about woman of power, influence and commitment to the community who make a difference - Mary DeFeudis was one great example of a selfless leader:
Mary (Streeter) DeFeudis was born in Worcester, and has lived in the Worcester area most of her life. She currently resides in Northborough. She has two children, Gino DeFeudis and Elizabeth Giguere both of Northborough. DeFeudis is a passionate and committed philanthropist, and volunteer. Her interests are primarily concentrated in areas that benefit children, cancer research, and improving the central Massachusetts community.
DeFeudis serves as the Chairman of the Board of Directors for the University of Massachusetts Memorial Foundation. She also serves on the Board of Directors of the American Red Cross of Central Massachusetts and the Board of Directors for Becker College. A Founding Member of the Hanover Theatre, she also serves on their Board of Directors. She was named the 2010 Isaiah Thomas Award recipient in recognition of the many and varied outstanding contributions she has made to the Central Massachusetts community.
One of the best pieces of news to the region was the announcement of Nypro's expansion in the area. It was big news, more jobs and the company serves as an economic engine.
The new parent of Nypro Inc. has owned the Clinton-based manufacturer only since July 1. But Jabil Circuit Inc. is wasting no time in seeking to highly leverage its latest acquisition.
Nypro announced on September 19 that it is planning a major expansion of its Bay State manufacturing operations because of the rapidly growing demand for its health-care products. The firm is negotiating a lease for a 200,000-square-foot satellite manufacturing plant in the Devens Commerce Center, located about 13 miles north of Nypro’s Clinton plant. Previously, the Devens space was occupied by Evergreen Solar, a maker of solar-power equipment that went out of business in 2011.
On July 1, Jabil completed its acquisition of Nypro for $665 million. Jabil expects the combined entity to bolster its position in key markets such as health-care as well as expand its presence in packaging for customers in the food and beverage markets, household and personal-care industries. The Consumer Electronics portion of Nypro’s business is being integrated into Jabil’s Materials Technology Services unit.
About 10,000 Nypro employees have become Jabil employees. Jabil is retaining the Nypro trade name, and plans to use it to jointly market services to customers in the health-care and packaging markets.
Jabil provides electronics design, manufacturing and aftermark
Downtown Progress and Delays
Downtown Worcester has been in redevelopment for decades. But the future is starting to emerge. While much needs to be done - and Main Street needs the most help - there are signs that the tides have shifted towards revival.
Here is what GoLocalWorcester reported:
As Rodney Dangerfield might have said, “Worcester gets no respect.” That’s certainly the case when it comes to downtown development. And it’s well-deserved.
“Worcester’s revival proving elusive,” the Boston Globe headlined yesterday’s story. “Ten years ago, Worcester’s downtown was going to hum. A consortium of city officials and investors pledged to turn 21 acres of blight into offices, stores, entertainment sites, and luxury residences.
The $565-million project - to be privately and publicly funded - was named CitySquare. Today, CitySquare is still a far-off promise, an unrealized revitalization effort that is all too common in the region’s old mill and manufacturing cities.”
Ouch! It brings back sad memories of when, many years ago, the New York Times referred to Worcester as “the utility closet of the Northeast.”
Interise's StreetWise Helps Emerging Businesses
Innovation doesn't come easy - but the efforts to kick-start new companies is getting a big boost from Interise's StreetWise.
Here is what GoLocalWorcester reported:
Small business owners throughout Greater Worcester, including some from the area's more economically distressed and low-income neighborhoods, recently completed Interise’s StreetWise ‘MBA’ program aimed at helping entrepreneurs create jobs and grow the economy locally.
The program, which the entrepreneurial nonprofit Interise offers in three other regions of the state and through partnerships and licenses in 34 additional cities around the country, allowed employers to work ‘on’ their business instead of ‘in’ it. This session included small business owners from Fitchburg, Gardner, Auburn, Worcester, Oxford and other locations in a host of different industries – from food to automobile to real estate.
Rather than studying large corporations, participants in the StreetWise ‘MBA’ program worked on their own business. Each business functioned as a live case and owners use their own experience as a case study. Business owners applied the lessons they learned about each topic to their own business and began to immediately implement change in how their company operates.
“We have heard such wonderful stories from graduates of our Worcester County program and are thrilled that it is enabling business owners to add jobs and in turn is helping the local economy,” said Jean Horstman, CEO of Interise, the nonprofit which developed the award-winning curriculum and manages the program.
Worcester Chamber Wants $1.2M To Court Biomed + Tech Manufacturing
There is big opportunity to tap into Tim Murray's State House connections and marry them to the innovation being sparked in the Med and Ed industry in the region.
Murray's goal is to bring real dollars in to jump start the region. It was one of the big stories of 2013 and will continue to be a huge story in 2014.
Here is what GoLocalWorcester reported:
Tim Murray has been in the driver's seat of the Worcester Regional Chamber of Commerce for less than 60 days. But he's already revving the long-stalled organization up to 60 MPH as the region's economic-development engine.
Murray's goal is to raise $1.2 million over the next few months, to recruit, retain and incubate biomedical firms, including high-tech manufacturers – those using high-tech equipment such as robotics to make products such as medical devices - in Greater Worcester. The new Worcester Economic Development Advancement Fund has initial commitments totaling $300,000.
Initial plans for WEDAF include identifying companies in sectors of the economy that play to our region's strengths. As such, the Chamber will focus recruitment efforts on specific industry sectors as well as the developer community.
In the past month, the Chamber reports, there has been “a significant increase” in the number of new businesses joining the organization. According to the Chamber, there have been “many initiating contact and asking to become a member. Several have cited increased activity by the Chamber and a new level of enthusiasm as factors in their decision to join.”
The membership turn-around is long overdue. Two decades ago, the then-named Worcester Chamber of Commerce had 4,400 members, including those of its affiliate Chambers. Since then, the ranks have shrunk by nearly 50 percent, to around 2,300.
Worcester’s Historic Elwood Adams Hardware Store- Oldest In US
Old school is still alive on Main Street, and there is no better example of success than Elwood Adams Hardware. The company has been serving Worcester for more than 230 years.
Here is what GoLocalWorcester reported:
As the skyline of downtown Worcester continues to change with the addition of numerous development projects, one building has truly stood the test of time. Having served the Worcester community since 1782, Elwood Adams Hardware boasts a unique claim to fame as the oldest hardware store in the U.S. It is also notable for being the first brick building in Worcester, built by Daniel Waldo in a time when Main St. was frequented by horse-drawn carriages, a stark contrast to the vibrant commercial block that now surrounds the store.
Over 230 years of service
Nowadays, Elwood Adams serves residential, industrial, and commercial customers with general and builder’s hardware, as well as restoration hardware. But the history of Elwood Adams begins in the late 1700s, when townspeople frequented Waldo’s store to barter over saddles, oil lamps, and shovels. It earned its namesake almost a century later, after Waldo sold the store to a man whose young apprentice, Elwood Adams, eventually bought it and gave it his name in 1869. The store’s ownership changed several times until two Frenchmen, Maurice Champagne and Nelson Cloutier, took over the business in 1958 with the agreement that the would keep the name “Elwood Adams Hardware.” To this day, the Cloutier family continues to operate the store.
Fitness Guru Lin Hultgren
Lin Hultgren has movie star looks and has built a passionate group of fitness followers. She is reinventing the business. She is the model of the next generation of small business.
He is what we reported:
Worcester native Lin Hultgren describes her week: "Eleven-plus fitness sessions, researching and preparing for Advocacy Bootcamp in DC and trip to Capitol Hill, obtaining documents and attending meetings for my son's transition into college, formatting exercise programs for a book (or two), brainstorming for an exercise video, being a landlord, being a Mom, and still finding time to partake in video shoots, photo shoots, attend fundraisers and spend time with my son and awesome friends!”
This is typical for the woman who lives what she teaches. Hultgren has enjoyed a successful career in the performing arts with dance and theater troupes including New England Repertory Theatre, Hammond Castle, First Night performances and medieval festivals including King Richard’s Renaissance Fair. She has also performed one women shows and a show entitled Magic in Motion with dancing, sword balancing and firespinning. Now she is taking the fitness world by storm.
Freight Farms: Hot Boston Start-Up Expands To Worcester
This never happens. Usually, the cool company starts in Worcester and then chases the VC money to Boston. The funders want the company close to home and the company moves to Boston or Cambridge. This is the opposite - Farm Freights could be the beginning of a trend - maybe?
He is how GoLocalWorcester reported it:
The color of the light inside the Freight Farms storage container that sits in a lot off Park Avenue is reddish-purple. Yet the plants, whose roots are suspended in nutrient-rich water, like it a lot, judging by their healthy, green stalks and leaves.
Because plants are highly efficient, they drink exactly as much nutritious water as they need. In a Freight Farms container, what one plant doesn’t consume, flows to the next vegetation in line.
Last November, Boston-based Freight Farms held the grand opening of its first Worcester facility, at 501 Park Ave. The start-up business hydroponically grows leafy greens, vine crops and mushrooms in insulated, climate-controlled containers, which operate from a standard electrical outlet.
Brad McNamara and Jon Friedman, founders of Freight Farms, seek to decrease the production costs and environmental impact of fresh produce by locating production much closer to the end consumer. Their modified, stackable containers use less water and energy than traditional agriculture.
Just as importantly, they eliminate the need for pesticides and herbicides.
How brilliant is that? So much so, that Entrepreneur magazine, in its latest issue, celebrates Freight Farms as one of the Top 100 Most Brilliant Companies in America.
Hollywood in Worcester
Worcester loved being the center of the entertainment industry this year. Having Bradley Cooper, Christian Bale, Jennifer Lawrence, Amy Adams and Robert DeNiro all in town was a big boon to the city's self-confidence and brought in millions to the economy.
Here is how GoLocalWorcester reported it:
Downtown Worcester got a makeover, as stars Christian Bale, Jennifer Lawrence, and Bradley Cooper were busy shooting Friday afternoon, causing a stir. Traffic snarled as crews worked against the dreary weather conditions to make way for the red carpet actors. Woosta Pizza, Spoodles Deli, Subway, and Honey Dew Donuts were just a few of the downtown businesses that got a momentary facelift for the film directed by David O. Russell.
Crews have been spotted around the city, including on Millbury Street. Batman and Dark Knight star Christian Bale was spotted at Nick's Bar and Restaurant.
The so far untitled movie, formerly referred to asAmerican Bullsh*t, was written by Eric Singer and will be based on the FBI's 1970-80 Abscam sting operation run from their Long Island office. The operation aimed to root out corruption in public office and led to the convinction of a US Senator, a member of the New Jersey Senate, five members of the House of Representatives, an inspector for the Immigration and Naturalization Service, and members of the Philadelphia City Council.
Bale will play Melvin Weinberg, a convicted financial con man hired by the FBI to spearhead the effort to take down fellow cons as well as mobsters, politicians, and the shady mayor of Camden, New Jersey.
Bale initially signed on to play the lead role last spring, but dropped out and was replaced by Bradley Cooper. However, Bale rejoined the cast in the same role, while Cooper now plays FBI agent Jimmy Boyle. The star-studded cast will also include Hunger Games heroine Jennifer Lawrence, Bradley Cooper, Robert De Niro, Amy Adams, Jeremy Renner, and Louis CK.
Return of Murray - to the Chamber
Out with the old and in with the new was the theme at Worcester Regional Chamber of Commerce. Murray resigned as Lt. Governor to take over the Chamber. It was big news in Worcester aas well as in Boston.
Here is the GoLocalWorcester story:
The good news for the Worcester Regional Chamber of Commerce is that Tim Murray is about to become its new leader. The bad news: The struggling Chamber has way too many networking-event candles in its cake as it celebrate its 100th anniversary.
In the immediate wake of Murray’s hiring by the Chamber’s Board of Directors, Board members heaped mountains of praise on Murray, who will replace Dick Kennedy. Last year, Kennedy announced his retirement after serving as president and CEO for the past nine years. Murray will reportedly be paid $200,000 a year – much more than the $125,000 annual paycheck he’s been getting as lieutenant governor.
The Chamber’s current chairman is Richard Burke, president of Senior Care Services and government programs and chief compliance officer of Worcester-based of Fallon Community Health Plan. He predicts the Worcester ex-mayor/soon-to-be former lieutenant governor will be “a strong leader of the business community, providing a keen focus on economic development. Tim Murray is a proven leader with a passion for economic development and the ability to lead the business community.”
Ralph D. Crowley Jr., president and CEO of Worcester-based Polar Beverages, noted that Murray’s accomplishments as lieutenant governor and mayor of Worcester “are already exceedingly visible in the revitalization of our city. He has an outstanding relationship with the business community as well as the City Council and City Manager Mike O’Brien. I think Tim’s leadership of the business community will provide a unique opportunity for all three of these vital constituencies to take Worcester into a brighter future.”
And Fred Eppinger, president and CEO of Worcester-based The Hanover Insurance Group Inc., expressed excitement at Murray’s appointment, calling it “great news for the Chamber and for the region. He is the perfect person to lead the organization at this pivotal point in time, with so much positive momentum on the economic-development front across the region and, with the potential for so much more. Tim has great vision, is a strong and tireless advocate for the region, knows how to bring people and organizations together, and has the drive and commitment necessary to make good things happen.”
Telegram - anyone want to buy it? Anyone?
The Telegram has lost double-digit percentage of advertising revenue and circulation. The New York Times Company sold it to John Henry and within days, he put it up for sale again.
Once an institution, the T&G is now at risk of being consumed by another media group. At best, three owners in one year.
Here is an excerpt from one of GoLocalWorcester articles covering the dynamic situation.
A report in Boston Business Journal outlines that Worcester's only daily newspaper's fate is in question after its sale as part of the Boston Globe deal to Red Sox majority owner John Henry.
The Telegram's new owner may absorb the paper into the Globe, could sell it, and could simply close it.
The value of the Telegram is limited. "People familiar with the T&G’s operations say it remains modestly profitable and could command a market value in the $3 million-to-$10 million range if Henry were to sell. Much of that potential value would depend on how well the T&G could affordably build out an administrative and technology infrastructure now that those operations are largely housed at the Globe’s headquarters on Morrissey Boulevard in Dorchester, sources say," writes the Boston Business Journal.
Amazingly, the Telegram and the real estate were purchased in 1999 for just over $300 million (the newspaper for $295 million and the Telegram and Gazette building for $13 million).
In recent years, the Telegram has been devastated by staff cuts, shrinking circulation and loss of advertising revenue -- especially in the past five years. According to an article by GoLocal's Pulitzer Prize-winning investigative editor at-large, Dean Starkman, newspapers like the Providence Journal and the Worcester Telegram have cut beyond the bone, "This is beyond fat, and well into bone. Really, we may already be getting past the point of no return."
JetBlue saves Worcester Airport
JetBlue finally arrived. The airport was functionally dark after the bankruptcy of Direct Air, and the arrival of this "cool airline" has helped Worcester get it mojo back.
It has not all been smooth, but the city is excited. Bill Randell's ongoing coverage of the airline has helped build the excitement.
Here is the intro into one of many of GoLocalWorcester's articles.
After months of anticipation, JetBlue is scheduled to fly out of Worcester's ORH, with talks being held later today.
According to the airline’s website, flights from Worcester will begin soon with destinations to Austin, TX (AUS); Fort Lauderdale, FL (FLL); Santo Domingo, DR (SDQ); Orlando, FL (MCO); Montego Bay, Jamaica (MBJ); Bogota, Columbia; San Juan, PR (SJU); and Nassau, Bahamas (NAS).
The solidified deal comes after a long process of courting the area, as officials visited the regional airport multiple times, over the last year.
"We take it very seriously when we choose to enter a city," said JetBlue's Martin St. George, during a visit in January. "We're very, very happy with what we saw today."
An official announcement will come later today as Governor Deval Patrick, Lt. Governor Tim Murray, and other officials visit the area.
In August of last year, JetBlue CEO David Barger said, “My headline is, 'Worcester feels very JetBlue," Barger said. "We're going to take this back to our support center and our home offices as we take a look at our fleet schedule, our delivery plans and what makes sense for us."
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