Travel & Leisure

Making Strides

As a business student at Wharton, TerraPass' Tom Arnold assumed the sensible career track was to succeed in the corporate world before striking out on his own. Then he met a professor who advised him to do the exact opposite.

Tom Arnold was a second-year student when he enrolled in a class with Karl Ulrich. During the course, he would develop TerraPass, a company enabling consumers to buy credits which fund clean energy projects that offset their carbon footprints. A successful entrepreneur and passionate environmentalist, Ulrich was searching for an easy-to-use consumer service to combat global warming, so he turned to his students for ideas. Under the auspice of Ulrich's guidance, what started out as a class project would turn into TerraPass' success story. When Arnold graduated, TerraPass had just over 500 members, today, more than 125,000 people have used the website.

Tom Arnold: "Karl made me realize it was possible to chase my entrepreneurial dreams and not put them off. He had already launched several companies and was able to guide me on how to take a business with very little capital to profitability."

Karl Ulrich: "Sometimes experience is overrated because once you're settled into a great job, you're less likely to take the same risks. What matters is an appetite to learn and strong problem-solving abilities."

Ulrich became a member of the board and got the ball rolling by setting up meetings with several key investors and industry contacts so that Arnold could raise money and get the marketing off the ground.

Tom Arnold: "Karl gave us valuable insight. It seemed like at every major fork in the road, he was there to point us in the right direction or at least help us critically evaluate the risks and benefits of various options."

Karl Ulrich: "I've always been a boot-strapper, doing more with fewer resources. Most ventures require deep pockets at some point, but rarely in the beginning. A key skill is learning to assess how much uncertainty will be resolved by spending. You should look for the biggest reduction in uncertainty for the smallest investment."

When start-up funds were waning, Ulrich suggested hiring a sales strategist. It would cost money that TerraPass didn't have to lose. The gamble paid off, and the new VP of sales brought in blue-chip accounts, like Ford and Expedia.

Tom Arnold: "Cash decisions are quite critical and knowing when to bat and when to conserve was a skill that I definitely learned from Karl."

Karl Ulrich: "TerraPass faced many critical decisions and there were no crystal balls. When faced with dilemmas, the best thing to do is organize the information at hand and make a decision. Outlining the pros and cons usually points to the right next step."