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This article by Barbara Fox was prepared for the May 8, 2002

edition of

U.S. 1 Newspaper. All rights reserved.

From Software To the Stage

Taking over a company as the turnaround guy is never

easy. But imagine that you have been there only two weeks when the

board fires the man who hired you, precipitating a vicious legal


that attracts international attention. That’s what happened to


Preston, a Princeton-based consultant to high tech entrepreneurs.

The fact that his client was the Martha Graham Center of Contemporary

Dance, and that he had absolutely no dance background — this did

not faze Preston. "Dancers are similar to technical entrepreneurs

in that they are both artists, and the creative dominance in their

personality might run roughshod over finance and marketing," says

Preston. "They can make use of people like myself."

Frankly, the intrigue of getting involved attracted me. I’ve done

very well."

Two years ago the Graham company and school had closed down to avoid

bankruptcy, but on Thursday, May 9, Preston will preside at a concert

at Manhattan City Center featuring the work of America’s most famous

modern dance pioneer. "We’re doing it to keep the dancers dancing

and to show the world that the dances are still alive," he says.

For tickets at $25, $50, or $75, call 212-581-1212.

Preston’s software career began at the University of Michigan, Class

of 1966, followed by R&D positions with IBM in Yorktown Heights, Ford

Motor Company, and Exxon Enterprises. After earning his MBA at Wharton

in 1981 he began consulting to high-tech entrepreneurs and


takes temporary full-time positions. From 1987 to 1994, for instance,

he was chairman and CEO of Scott Instruments, a Texas-based speech

recognition software firm. His firm, Newmarkets Inc., is located in

a studio behind his house in the heart of Princeton.

So how did he get this unlikely dance administration job? One of his

avocations is music, and he served on the board of Young Audiences.

Another board member, a headhunter who was trying to fill the Graham

center’s executive director position, asked Preston to help her fill

out the roster of candidates. As a favor, he went to the interview

and ended up getting hired by the controversial Ron Protas, who had

gained Martha Graham’s favor in her waning years and attained

the title of artistic director. After Graham died, the company

struggled, and her prized building had to be sold.

But because Graham had to cede ownership to many parts of that legacy

in order to create a nonprofit organization, the board was able to

take control. "Two weeks after I got there, the board fired


says Preston. Protas filed suit. To the joy and relief of the dance

world, the court said that, even though Protas is Graham’s heir, he

did not own her technique. The second court decision — over the

ownership of the dances, costumes, and sets — is imminent.

Referred to as "the foxy executive director" by one New York

reporter, Preston restructured the administration and finances of

the organization. "I got the board to put up over $1 million


to make the organization solvent. I got the state to put up nearly

$1 million to help us build new studios. I have raised well over $1

million to keep our operation going since January, 2001, and the


is in full operation with about 500 students." The May 9 concert

was scheduled to show that the legacy is alive and well. "The

assets are disappearing the longer we wait," he says. "As

dance aficionados know, the dances will die unless they are used."

Preston’s niche is to take high tech companies (preferably software

based) from the start-up stage to the point where funds from venture

capitalists kick in. Like an investment banker on a small scale, he

helps investors and entrepreneurs understand the evolution of equity

and build a mental model of their own business — the dynamics

of cash flow and how much equity is reasonable for them to keep.

Among his clients was Ira Baseman, who built on Emmons Drive

and successfully sold it. Others were Massachusetts-based Network

Engines and Illinois-based HealthTech Services, a telemedicine spinoff

of Baxter. Princeton-area clients have included Jersey Cow Software,

SBX, and Textscape Technologies.

To technology and artistic organizations alike, Preston has this


Let go of the solution and find the problem . The client

will trust the master of the problem but turn away from the salesman

with a particular solution. Other ways of saying this: "Change

supply side thinking to demand side thinking" and "Be customer


Be willing to collaborate . Good ideas are not enough.

If you fail, do it in an ethically responsible way, so

you can start again. The founder of Dow Chemical, for instance, had

four failed companies before his big success.

Similarly, the Graham board shut down the company rather than

pay royalties to Protas, and the Graham dancers sided with the board.

Now — collaborating — they are working to reconstitute the


— Barbara Fox

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