Chương 15: Chapter 16: The Five-Million-Dollar Race

The fourth-floor conference room was slowly filling up. In the year since the company had moved into this building, the room had hosted its fair share of meetings, but today's promised to be different. The long darkwood table seated eighteen, and nearly every chair was occupied. Prescott settled in to the right of my seat and spoke quietly with Corrigan, who was absently flipping through a stack of papers without paying much attention to what was written on them.

Chen took her usual place, notebook ready and three freshly sharpened pencils arranged in a perfect row. Angleton claimed his preferred chair in the corner, where he had a clear view of the table, the door, and the windows. An unlit cigarette hung from his lips. Bagley was absent, and for good reason. Over the past two weeks, we had uncovered two moles inside the company. He and Wright were currently trying to determine how the breach had happened and how deeply it went.

Jennings was having a low-voiced conversation with Salazar that, judging by their gestures, had something to do with the latest changes in federal regulations. Rutman, who handled market analysis for the company, was studying the folder I had given him the previous evening with instructions to prepare some preliminary projections. Grant leaned toward Greer, the head of our public relations department, and whispered something to him, occasionally glancing in my direction.

Phineas and Kozlowski had clearly come straight from the laboratory without stopping to change. Fresh oil stains marked Phineas's sleeves, while Kozlowski's lab coat gave off the sharp chemical smell she had long since stopped noticing. Several newer employees who had distinguished themselves over the past few months had been invited to a meeting at this level for the first time. They looked around with poorly concealed curiosity and nerves, while doing their best to appear relaxed.

Wesley, naturally, was there as well, standing just behind my chair. I waited for the conversations to die down, then rose.

"Gentlemen—and ladies. We have a full agenda today, so I suggest we get straight to business. First, I'm going to present several concepts for expanding our most established product division: office supplies." I placed a thick folder in front of me and looked around the table.

"A great many of our people are already comfortable working in this field. We have built a reputation, established distribution channels, and secured contracts with some of the largest retailers in the country. Now it's time to introduce a few new ideas and expand the product line." I laid the first concept sheet on the table.

"Page flags. Different colors and sizes." Martin from production, a broad man in his forties whose eyebrows seemed permanently drawn together, immediately raised a hand.

"Hold on, Mr. Miller. We already manufacture adhesive notes and pads in different shapes and sizes. What's the point of adding another product that does essentially the same thing?" It was a reasonable question, and one I had expected.

"The point is ease of use and the way people will organize information," I explained, sliding the sketch closer to him.

"Yes, we already produce small adhesive notes, and yes, they can stick out from the edge of a book. But imagine a student studying for an exam. He opens his textbook and sees ten identical yellow slips protruding from the pages. To find the chapter he needs, he has to open every marked page and check what's there.

"Now imagine he has a system. Red flags mark definitions he needs to memorize. Yellow flags mark important formulas. Green flags mark worked examples. One glance at the edge of the book tells him where everything is. Color works faster than text. The eye recognizes it instantly, without having to read or remember." I looked around the room.

"The same principle applies in an office. A secretary sorts a stack of documents awaiting a signature. A red flag means urgent—it has to go out today. Yellow means it requires attention but can wait until tomorrow. Green means it is merely for review. The executive looks at the folder and immediately knows where to begin without flipping through every page. It saves time, keeps things organized, and reduces careless mistakes.

Children and teenagers will buy them simply because bright, colorful little objects attract attention on their own." One of the newcomers scribbled something rapidly in his notebook. When he finished, he looked at me over the rim of his glasses.

"It sounds practical, and potentially very profitable. But I have an obvious question. Why didn't we do this earlier? It's hardly a revolutionary idea." Several people nodded, apparently wondering the same thing.

"Good question." I planted both hands on the table and leaned forward.

"There are several reasons, all tied to the strategy we have been following since the beginning." I straightened and began counting them off on my fingers.

"First, a year ago, we were nobody. A small company with one product and an ambitious owner no one in the industry knew or took seriously. Our adhesive notes alone weren't important enough for the major players to bother declaring war on us. They would have had to spend too much time and money crushing a minor company over a single product, especially when that product was already protected by a respectable patent portfolio.

"It wasn't worth the trouble. Page flags change that. At that point, it stops being one product and becomes an entire category. Adhesive notes, page flags, and whatever follows after them create a very different picture. That is a piece of the market worth fighting over." I paused to let that sink in.

"If we had introduced page flags a year ago, the major corporations could have crushed us without much effort. And I'm not just talking about lawsuits, although our chances against an army of corporate attorneys would have been poor, to put it mildly. I'm talking about every other trick available to them: connections inside retail chains, private agreements with purchasing managers, pressure on suppliers.

"Companies like 3M or Avery could flood the market with similar products at dumping prices. They could negotiate priority shelf placement with retailers. They could simply suffocate us without breaking a single law. A year ago, we would have been easy prey." Prescott nodded. From his expression, he was remembering our early conversations about risk and why we had chosen not to expand the line too quickly.

"Now the situation is fundamentally different," I continued.

"We have contracts with Sears, Montgomery Ward, True Value, and more than a dozen other major chains. We are in their catalogs. We have shelf space. Our logistics are established, and we have proven ourselves as a reliable supplier.

"If someone copies our idea now, they will have to start from scratch and build relationships with the same retailers that already work with us and are perfectly satisfied with the arrangement. By then, we will control the category and be in a position to dictate terms." I gave them a moment to process that.

"Second, our reputation has finally begun working for us." I allowed myself a faint smile.

"Retailers trust the quality of products bearing our logo. We earned that trust through hard work and a properly organized quality-control system. Every partner we work with knows that we monitor standards at every stage, from manufacturing to packaging.

"They will accept a new Aegis Industries product without months of persuasion and extended trial periods. A year ago, we would have had to knock on doors and prove ourselves to every buyer in every chain. Today, all it takes is a phone call." Corrigan had been listening attentively, leaning back in his chair. He suddenly slapped one palm against the table and grinned.

"Boss, since you mentioned phone calls—the people at Sears contacted us yesterday. They wanted to know whether we had anything new for the fall catalog." I could not have asked for a better demonstration of my point.

"Exactly." I placed several more sketches on the table.

"Third, page flags are far from the only thing on today's agenda. We will begin with a field in which we have already proven our competence." Kozlowski leaned forward for a better view of the new sheets.

"What else have you prepared, Mr. Miller?"

"Our next product is correction tape." She raised an eyebrow.

"Correction tape? Correction fluid already exists. You can buy it in any office-supply store."

"The purpose is similar. The execution is completely different." I turned the diagram so everyone could see it.

"This is a roller mechanism containing a dry strip coated with correction material. You pass it over a mistake and can write or type on top of it immediately. There's no waiting for it to dry. It doesn't stink up the entire office. It doesn't stain your hands or clothes. And it cannot spill across the desk when someone knocks it over." I looked around the table.

"I'll admit, it isn't an earth-shattering invention. But it will find plenty of buyers. Anyone who has ever sat waiting for that white sludge to dry before typing the next letter will want to try an alternative. Secretaries who correct hundreds of errors every day will line up for it." Phineas had already stopped listening. He was completely absorbed in the diagram, his fingers tapping against the table as his mind worked through the mechanism.

"The tape feed will require precise tension," he muttered without looking up.

"If it runs too loose, the tape will wrinkle, tear, or wind unevenly. If the tension is too high, the roller will slip and leave gaps in the coating."

"That won't be a problem for you, will it?" I asked, already knowing the answer. Phineas finally looked up.

"I already know how to solve it. A spring-loaded ratchet with adjustable resistance. Give me a week, and I'll have a prototype."

"Excellent. Then let's move to the next item." I pulled out another sheet.

"Since we have made serious progress in adhesive compounds and now produce some of the finest commercial adhesives on the market, the logical next step is self-adhesive cold-lamination film." Chen frowned, her pencil stopping above the page.

"Lamination? That's an entirely different field."

"Not entirely," I said.

"The foundation is the same: adhesive technology, polymer films, and an understanding of how different materials bond. Let me show you the problem." I walked to the board and picked up a piece of chalk.

"Traditional hot lamination requires specialized machinery that can cost anywhere from a hundred dollars to several thousand. You need the correct temperature, pressure, and feed speed. For a small office or school, that is unnecessarily complicated and expensive." I drew a rough diagram of a laminating machine.

"But cost is not even the main problem. More and more heat-sensitive materials are entering everyday use. Cash-register receipts printed on thermal paper. Fax paper. Certain types of photographs, especially instant prints. Hot lamination can deform them or destroy them completely. Someone tries to preserve an important document and ends up with a warped piece of plastic containing something no longer legible." If you stumble upon this narrative on Amazon, be aware that it has been stolen from Royal Road.

Please report it. I put down the chalk and returned to the table.

"Cold, self-adhesive film solves the problem completely. Peel away the backing, place it over the document, and smooth it down. No machinery. No heat. No risk of ruining the original. The film will cost pennies per sheet." Still staring at the board, Phineas spoke.

"I've heard of similar work being done by some of the larger chemical companies. But they are focusing almost entirely on industrial applications. Protecting surfaces during transportation, temporary coatings for manufactured parts, that sort of thing." He fell silent for a moment, considering it.

"As usual, Mr. Miller, you're taking an existing technology and proposing an application that could interest the mass market. The consumer market for cold lamination is practically nonexistent."

"Which is precisely what I'm counting on. Offices, schools, and ordinary consumers all want to protect important documents, but they aren't willing to spend two hundred dollars on a laminator. Our film gives them the same result for a few cents." Kozlowski was already writing rapidly in her notebook, clearly working out possible adhesive formulations. I placed the final concept drawing from that section on the table.

"And to finish the office-supply portion of the meeting: name badges." Salazar, who had been listening quietly and making notes, could not suppress a skeptical smile.

"Name badges? With all due respect, Mr. Miller, what can possibly be innovative about a name badge? It's just a card with someone's name on it." Corrigan, seated across from him, shushed him with exaggerated severity.

"Quiet, Salazar. I want to watch the boss open our eyes to yet another obvious thing we have all been walking past for years." A ripple of laughter went around the table. Even Angleton, who normally maintained a stone face, allowed himself a slight smile. I waited for the amusement to fade.

"Name badges have existed for a long time. But let's consider what they look like today and how they are used." I lifted one of my drawings.

"A handwritten or typed card is slipped into a cheap clear sleeve and pinned to a shirt or jacket. The pin leaves holes in the fabric. The plastic clouds and cracks. The badge constantly flips around or falls off at the worst possible moment. To put it mildly, it does not look professional." Several people exchanged glances, clearly recognizing the problem.

"We are going to do it differently." I handed the drawing to Prescott so he could pass it around.

"A rigid plastic holder with a transparent window, protecting the card and giving it a more polished appearance. Instead of a pin, an alligator clip attaches to a breast pocket without damaging expensive clothing. For people without a suitable pocket, there will be a lanyard.

"The same holder can be reused with different cards. One name and title for a conference, another for an internal event, and a third version for visitors." Grant, who usually remained quiet during meetings, spoke up.

"That would be useful. I attended three trade shows last month, and those ridiculous pins left holes in my blouses every time."

"Those are exactly the kinds of problems we intend to solve," I said.

"We will introduce the badges inside our own company first. Every Aegis employee will receive a professional badge displaying the company logo, their name, and their position.

"This is not just about identification. It is part of corporate culture. One standard, a professional appearance, and a visible sense of belonging to the same organization. And when we bring the product to market, we will be able to tell potential customers honestly that we use it ourselves every day." Prescott finished examining the sketch, passed it along, and turned to me.

"The concept is sound, but I'm concerned about the size of the market. How many companies use badges regularly? For now, they're mostly limited to conferences and trade shows."

"For now," I agreed.

"But look at the trend. Corporations are growing. Their workforces are expanding. Office buildings are becoming larger. In a company of twenty people, everyone recognizes everyone else. In a company of two hundred, it becomes difficult to remember every employee, let alone every visitor. In a company of a thousand, identification badges stop being a convenience and become a security requirement." Angleton, who had been silent until then, finally spoke.

"After several recent cases of industrial espionage, companies are beginning to take access control more seriously. Badges are cheaper and simpler than posting a guard at every door." I nodded.

"Exactly. And don't forget conferences, exhibitions, seminars, and corporate events. All of those sectors are growing every year." The next twenty minutes passed in lively debate. Martin asked about materials for the holders and potential manufacturing methods. Kozlowski suggested several plastics with different properties. Salazar began outlining a patent strategy for the clip mechanism.

Corrigan discussed marketing possibilities: customized corporate orders, premium versions for executives, and special runs for major events. When the discussion began to fade, I raised a hand.

"Everything we have just discussed is not, of course, the full list of what I intend to propose today." The room fell silent at once. Every eye turned toward me.

"Yes, these products will keep us busy. Development, manufacturing, marketing, distribution—every department in this room will have enough work for the next several months. By my estimate, full deployment of the new line should increase company revenue three- to fourfold within six months." Chen smiled with quiet satisfaction. Of course she did.

"But all of that, ladies and gentlemen"—I paused, studying the faces around the table—"is small change." Chen's smile slowly disappeared. Her pencil froze above the notebook.

"Small change?"

"In the context of what comes next, yes. Small change," I said calmly.

"We will continue developing our office-supply division, strengthening our market position, and increasing production and sales. Organic growth is stable and reliable. I have nothing against it.

"But organic growth takes time. A great deal of time." I looked around the table.

"And some opportunities do not wait." After a brief pause, I continued.

"We are entering a much larger game. We need to capture a market that almost no one has noticed yet. We will have to move quickly—faster than we are accustomed to." I turned toward Jennings, seated near the windows.

"Tell me, what laws have recently been passed—or are currently being considered—regarding fire safety in residential buildings? Specifically, smoke detectors." Jennings took a moment to collect his thoughts.

"As far as smoke detectors are concerned, several states have already introduced mandatory installation requirements in residential properties. California, Massachusetts, and roughly a dozen others. New York is considering similar legislation, and from what I understand, passage is only a matter of months. Current projections suggest that comparable requirements will be in effect across most of the country by the end of next year."

"Exactly what I wanted to hear." I pulled a new set of documents from the folder.

"Smoke detectors. Required by law." I spread the papers across the table and gave everyone a few seconds to examine the figures.

"There are roughly eighty million households in the United States. The law will require a detector in every home, but that is only the beginning. Add apartments in multi-unit buildings, where the requirements will be even stricter. Add hotels and motels. Office buildings, schools, hospitals, stores, and restaurants. Add every new property constructed each year.

"Then add the need to replace the devices every eight to ten years, because no detector lasts forever. That is guaranteed demand for decades." I laid out the cost projections.

"At present, the manufacturing cost of a standard detector is approximately five dollars. Retail prices range from fifteen to twenty dollars, depending on the model and manufacturer. Do the math." Another sheet went on top of the first.

"Automobile alarm systems. You all read the newspapers. You know what is happening on the streets. Last year, more than eighty thousand vehicle thefts were reported in New York City alone, and that is merely the official figure.

"Insurance companies are already offering meaningful policy discounts to drivers whose vehicles have alarm systems. The market is expanding by forty to fifty percent a year, yet there is still no clear leader—only dozens of small manufacturers producing mediocre equipment and earning terrible reputations." I placed the final document on the table.

"Personal alarms. Compact keychain devices that produce a one-hundred-and-forty-decibel siren when activated. Louder than a jet aircraft during takeoff.

"The target market includes women walking home late at night, elderly people worried about robbery, students, tourists—anyone who wants a legal means of drawing attention and frightening off an attacker. Estimated manufacturing cost: one dollar and fifty cents per unit. Retail price: around ten dollars. The markup is well over five hundred percent. More importantly, it is a new concept, and the market is practically empty." I set my pen down and straightened.

"Three product lines, all within the security sector. All supported by either guaranteed or rapidly increasing demand. All offering profit margins most manufacturers can only dream of." Prescott was the first to break the silence. There was something close to excitement in his voice.

"It will work. It is obvious that it will work. A legal requirement does not merely create demand—it creates an obligation. People will buy the detectors whether they want to or not, because the law will leave them no choice."

"I agree with the analysis," Rutman added, tapping one finger against his notes.

"And the trend will only intensify. Regulations will become stricter each year, the requirements will expand, and penalties for noncompliance will rise. It is a long-term development, and it works in our favor. I have gone through the projections. I don't see any unexpected threat serious enough to undermine the venture." Chen narrowed her eyes at me. From her expression, she was already running numbers in her head.

"Mr. Miller, it all sounds excellent, and I'm not disputing your reasoning. But we have five hundred and sixty thousand dollars in reserve, and you are proposing that we enter an entirely new sector. Different products, different technologies, different production requirements. Are you sure we are not overestimating our capabilities?"

"We will proceed in stages," I said.

"Each new step begins only after the previous one starts producing results." I pulled out another document, this one containing a timeline and financial projections for each phase.

"Look here. Step one: we purchase a small smoke-detector factory. I have already found a suitable operation in Hartford, Connecticut. The owner is an elderly man who wants to retire and move to Florida. His son has refused to take over the family business. He is asking three hundred and fifty thousand, but given the circumstances, I believe I can bring him down to two hundred thousand or less." Chen calculated instantly.

"That leaves three hundred and sixty thousand in reserve."

"Correct. But the factory is not an empty building. It is already operational and already profitable. Not extremely profitable, but stable. It comes with machinery, trained workers, established suppliers, and a small but existing customer base.

"Phineas will take over the product, improve the design, and reduce manufacturing costs. I'm confident he can manage that. We will use our existing contacts to put the detectors into major retail chains. Within two or three months, that factory will be earning three times what it earns under a man who thinks only about retirement and fishing." I pointed to the next stage of the plan so everyone could follow the logic.

"The personal alarms are the simplest item on the list. We will not build our own production line, at least not at first. We contract the manufacturing to Hong Kong according to our specifications and under our quality control. Minimal initial investment, maximum markup, and a rapid launch.

"Automobile alarms will be more complicated and require more serious engineering work, but we can begin with contract manufacturing there as well. Once we have accumulated sufficient capital, we can build our own line." Greer had been studying the timeline carefully. He looked up.

"Am I understanding this correctly? Every dollar we earn goes straight back into the company? No distributions, no significant reserve for emergencies?"

"Exactly. No dividends. No excess reserves beyond the absolute minimum. Everything goes into expansion. Aggressive reinvestment for the entire period." Chen rolled the pencil thoughtfully between her fingers.

"It is risky, but acceptable. The income from the new office-supply line should provide at least some cushion. The page flags and correction tape will begin selling before the detector operation reaches full capacity." Grant raised a hand.

"Mr. Miller, may I ask something? I understand the logic behind each individual step, but I don't understand the larger picture. Why the urgency? We could continue expanding the office-supply business, accumulate capital, and enter these new markets safely in a few years. Why are you proposing a race instead?" I met her gaze.

"Because in a little over one year, we need to earn five million dollars." Silence settled over the room. Someone exhaled softly.

"Five million?" Chen repeated, automatically glancing toward the calendar on the wall.

"Yes." Angleton leaned forward in his chair.

"What is the hurry, Mr. Miller? What exactly is supposed to happen in 1977 that requires precisely five million dollars? Has your model"—he gave the word a faintly ironic emphasis, referring to my reputation for seeing opportunities where everyone else saw empty space—"noticed something important that the rest of us have missed?" I took my time before answering.

"I see an extremely promising industry. Within ten or fifteen years, it will be worth billions of dollars. But the window for entry is closing. Right now, almost no one is involved—only a handful of enthusiasts and pioneers. In two or three years, the major corporations will enter with vast amounts of money and resources, and breaking into the market will become many times more difficult.

"To enter early and secure a position from which no one can dislodge us, we need starting capital. Five million dollars is the minimum."

"What industry?" Phineas asked. His eyes had lit up. He could already smell an interesting technical problem.

"We will discuss that when we have earned the five million," I said firmly.

"For now, your task is to focus on what is directly in front of you. Office supplies, detectors, automobile alarms, personal alarms. Everyone does their part as well as possible. When the time comes for the next step, you will be the first to know." I looked around the table, giving everyone a chance to respond.

"Questions? Objections? If anyone believes this plan is unrealistic or that I am steering the company toward disaster, say so now. I would rather hear your doubts in this room than discover them later, when it is too late to change course." The silence lasted several seconds. Then Corrigan slowly nodded.

"The logic is solid. Legislation guarantees demand, the markups offset the risk, and aggressive reinvestment accelerates growth. Even looking for one, I can't find a serious flaw in the plan."

"From a manufacturing standpoint, it is realistic," Martin added.

"Provided we purchase existing capacity instead of trying to build from the ground up. We simply don't have time for new construction." Chen sighed, closed her notebook, and looked at me over her glasses.

"The numbers work. Assuming everything proceeds according to schedule and we don't run into any major unforeseen obstacles, it should succeed."

"Then let's get to work." I closed the folder and rose.

"Chen, begin preparing for the Connecticut acquisition. I want a complete financial analysis of the factory's records for the past three years. Jennings, verify the legal condition of the company—ownership history, liens, liabilities, lawsuits—and prepare the contracts.

"Phineas, begin designing the improved detector and the new office-supply products. I want working prototypes within two weeks. No later. Salazar, patent everything that can be patented. Martin, begin preparations for page-flag production and set up the correction-tape line in parallel. The office-supply division still has a business to run, and it needs to run like clockwork." I glanced at the clock above the door.

"I expect the first results in one week. Any final questions?"