Worth

First Person

The Populist's Capitalist
Charlie Crystle
05/01/2007

Charlie Crystle, 39, is a technology entrepreneur best known in his home state of Pennsylvania as a man who tried—and failed—to unseat Arlen Specter as U.S. senator in 2003. Now he is immersed in a startup software company that he and two partners run from a space in a converted tobacco warehouse in Lancaster, Pa. Fueled by profits from the sale of his last company, Crystle has become a determined progressive thorn in the side of Lancaster’s largely Republican populace.

SINCE THE sale of his software company in 2000, Charlie Crystle (center) has worked to assist street children in Central America.

Today I run a software company called Mission Research, which I started in 2001 with Dave Weaver and Chris Walker. It is the second software company the three of us have started together. At this year’s DEMO conference, a convention where 70 emerging technology companies with promise are invited to exhibit their projects, a Lancaster reporter said our product wasn’t the most show-stopping. But we’re doing something important that we are proud of.

Our company makes administrative software that is inexpensive and easy to use. We have a program for small businesses, but our main line is GiftWorks fundraising software for small and medium-size nonprofit organizations. It lets groups track donors and trends and creates lists, charts and graphs very easily. We are going to make the software free to customers in developing nations. I don’t feel comfortable taking money from poor countries. In America, the software costs $299, which is reasonable, but in other areas of the world, you can hire someone for $14 a year. I’d rather have the money go to people who need jobs than have it in our pockets.

I grew up in Lancaster, and it isn’t exactly a high-tech center, but we would like to be able to create jobs here. The cost of living is so low that it’s really attractive for people who have come up through the high-tech industry in Silicon Valley or New York. We’re recruiting a lot from both places. Ben Cohen from Ben & Jerry’s is one of our investors. This time around there is a lot of venture capital out there; we continue to invest ahead of our revenues and we have great growth prospects. I love going to work every day.

But it wasn’t always that way for me. Chris, Dave and I started a software company called Chili!Soft in 1996, which had a product that enabled customers to build Web-based business applications. The software is still on the market, and I still like my investors from that period. They made a lot of money, and we all benefited. But I didn’t love the work environment. That was partly because of mistakes in some of the hiring we did—and partly because of the way I interacted with the staff. I was a hothead. I didn’t understand that not everyone wanted to work all night long, then get up early and go to work the next day and make it a great company. I was a very powerful force, and that’s not always the best thing for a work culture. I burned out and left in 1999, just before Cobalt Networks bought the company for $70 million (in March 2000). Sun Microsystems bought Cobalt Networks just six months later for $2 billion. I was still a shareholder, though, so I profited from the sale. And even though this happened right before the markets started collapsing, I did OK.

After the sale, I went to Central America to learn Spanish, surf and decompress. I’ve had a sense of social and economic justice since my high school years, but in my travels I became a human rights activist. I met someone who introduced me to the issue of street kids in poor countries like Nicaragua, Honduras and Guatemala. I didn’t really make a plan for how I would support the cause, but I became very passionate about it. I even made a documentary about the street kids called Children in a Jar to help advocate for them.

Now I am very much into sustainability and socially responsible business. My partners and I have donated 20 percent of our founding stock in Mission Research to a foundation and a donor-advised fund. I’m looking forward to the day when we have time to do something more with the money.

I also tried running for the U.S. Senate. It wasn’t something I really planned, but I was angry about the way the government has handled the war in Iraq—and the failure of the U.S. government to act on behalf of small and midsize businesses when it comes to trade policy. We trade with China on the same basis that we trade with Canada or England, which are democratic countries, whereas China engages in illegal trade behavior. It’s an authoritarian regime, it executes democracy activists, and it uses its economic power to violate almost every clause of the WTO agreement. That’s why I ran a campaign for the Democratic nomination. I raised a bit of money, but it was mostly my own funds. I was polling decently, but I was not prepared, so I backed out of the primary. It is very hard work—and Pennsylvania is not a state that has healthy, clean politics. Joe Hoeffel, who won the Democratic nomination, lost to Arlen Specter in the election.

From the Pulpit
The issue of healthcare was definitely part of my platform. Just as our company makes our software free to the needy, I think healthcare ought to be available to everyone who needs it. So I’m using my money to do something about that. I’m working on bringing universal healthcare to Pennsylvania. After I dropped out of the primary, I began working with a group of community activists, and we started an advocacy organization called Pennsylvanians United for Single-Payer Healthcare. At our first meeting in January 2004, only 70 people showed up, but it has grown since then.

I often ask myself questions like, ‘How much is enough?’ What is the difference between reasonable wealth and excessive wealth?’
In 2005, I hosted the Pennsylvania Conference on the Healthcare Crisis in Harrisburg. We had a diverse turnout that included representatives from both the AFL-CIO and the Pennsylvania Manufacturers’ Association, as well as healthcare leaders from across the country. At the meeting, we resolved to address the healthcare crisis through legislation, and out of the conference came a bill for a single-payer system that would lower the costs of doing business and cover everybody comprehensively. State senator Jim Ferlo introduced the bill in the Senate last year, and this year it was introduced in the state House of Representatives, where we have about 30 supporters. We have some real momentum. We have tried the market system of healthcare and it has failed repeatedly, so it is time to make healthcare part of the dial tone of our society and our economy. I always say to doubters, "Look at our roads: They are publicly financed and they’ve worked out pretty well."

Health insurance represents about 17 percent of my company’s payroll costs. That is considered low by today’s national standards, because we are a tech company and we pay higher salaries than a manufacturing company. But our costs have doubled over the past four years. That’s money that doesn’t go into marketing and doesn’t go toward hiring the next person. We’ve grown from three people to 21 now, but the cost of healthcare keeps us from growing faster.

I am a capitalist. We’re nice people at our company, but we still want to crush the competition. I think, though, that the relationship between capitalism and democracy has been turned on its head. Capitalism is an economic system, not a political system. It is supposed to serve a democracy, but it is the other way around now—democracy in the service of capitalism.

I often ask myself questions like, ‘How much is enough?’ What is the difference between reasonable wealth and excessive wealth?’ I have a cutoff line. I put a certain amount into a trust and live off the income; the rest of it goes into investments for the long-term and a foundation. I don’t have a family to support yet; I’ve been pretty busy, but maybe I will someday soon. I don’t have a great desire for things. I used to play in a country rock band, and I like guitars and recording equipment, but I have all of those things already. This is going to sound arrogant or overblown, but I think my life is about improving the human condition. It seems to be the thing I keep getting drawn to.