Hoffman Rides His Business Success Into Political Arena

Randy Hoffman concedes that he was probably driven to excel in business in order to overcome a troubled childhood and an abusive, alcoholic stepfather.

At 17, he won top honors at his school for forming a student-run company that sold holiday-decorated brandy snifters filled with peppermint candies.

By age 30, he was president of a binocular manufacturing firm with over $100 million in annual sales. Three years later, he took the reins of Magellan Systems, a company that became one of the country’s fastest-growing private enterprises and in the process made him a multimillionaire.

The drive to succeed grew out of an unstable home environment and moving around a lot, Hoffman said. “Maybe it was the desire to build something and own something.”

That same drive now propels Hoffman to try to conquer the world of politics. He is vying for a seat in Congress to represent the west San Fernando Valley and parts of Ventura County. To win, he must unseat freshman incumbent Brad Sherman (D-Sherman Oaks), who made a list of 10 most “vulnerable” Democrats who will be targeted by the Republican Party this year.

On paper, Hoffman looks good. He has a Harvard degree in business, a personal net worth of between $2 million and $7 million and the management experience to organize a powerful campaign. He already has put nearly $300,000 of his own money into the effort.

Hoffman, the favored Republican candidate in the June primary, has the support of Republican politicians and business leaders such as Rep. Elton Gallegly (R-Simi Valley) and Valley auto dealer Herbert Boeckmann.

House Majority Leader Rep. Dick Armey (R-Texas), Majority Whip Rep. Tom DeLay (R-Texas) and other party leaders have also contributed to Hoffman.

“We’ll do everything we can to support Randy Hoffman,” an Armey spokesman said.

But after nearly a year of campaigning, Hoffman remains vague about the policy matters he hopes to champion if elected. He has declined to discuss how he differs from Sherman, saying that his immediate goal is to get his name and accomplishments known by voters throughout the district.

He talks in general terms about improving schools, reducing bureaucracy and fighting crime. But his speeches and campaign brochures focus more on his business success and his “real world experience.”

That only provides ammunition for his critics who call him an “empty suit” with little history of community involvement outside of his business ventures.

“It’s amazing that they would say I have no interest in the community when I have created hundreds of jobs in Southern California,” Hoffman replies.

Hoffman also bristles at critics who compare him to another Republican businessman who made the transition into politics: Mike Huffington, the millionaire former congressman who spent nearly $30 million on a failed bid for a U.S. Senate seat.

Huffington made his wealth on his father’s oil and natural gas prospecting firm, while Hoffman said he worked his way up from a modest and troubled childhood.

“There is nothing easy about building a business,” he said.

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Hoffman was born in Evanston, Ill., 44 years ago. He was raised by his mother, Alice Bates, a secretary, and his stepfather, Phil Colvin, a toolmaker. His mother and birth father divorced when Hoffman was 3.

The family moved to California in 1961 in search of work in the growing aerospace industry. But jobs were hard to find, and at one point the family was forced to file for bankruptcy.

Making matters worse, Hoffman’s stepfather was a “raging alcoholic” with a violent temper, Hoffman’s mother said. She claims he once threatened her with a knife while a 7-year-old Hoffman hid in the closet.

“In the late ‘50s and early ‘60s, you didn’t talk about it,” she said. “There was no place to go.”

In search of fulfillment outside of home, Hoffman joined Junior Achievement, an after-school program that teaches youngsters how to run a business.

“It turned out that I really enjoyed it and was good at it,” he said. “I guess it was also a good escape from the family environment.”

He got his first taste of the enterprise system when he started “Possibilities Unlimited,” the student-run company that sold snifters for $3 a piece. He won top honors with the company and a trip to Indiana University for a nationwide conference.

After high school, Hoffman attended Orange Coast Community College and transferred to USC, where he graduated summa cum laude. He was accepted by Harvard Business School, where he earned a master’s degree in business administration.

After graduation and a stint at the management consulting firm of Booz, Allen & Hamilton, Hoffman was recruited by Bushnell, a marketer of binoculars, telescopes and rifle scopes that controls 34% of the world market. He became president of the firm within three years.

But his most successful venture was launched in 1987, when he met Edward F. Tuck, a West Covina-based venture capitalist who has helped launch more than half a dozen start-up companies. Tuck had an idea for a hand-held device that could use satellite signals to show hikers, boaters and other outdoor enthusiasts their exact location anywhere in the world.

Tuck said he approached Hoffman to head Magellan Systems because of his reputation as a good manager with a strong knowledge of the outdoor market.

“He deserves a great deal of the credit for making this company take off,” Tuck said.

Hoffman’s initial role was to secure venture capital to start the endeavor. But it was not easy. At the time, only six satellites were in orbit and their signals could be received only at night.

“One hundred and fifty venture capitalists turned us down,” Hoffman said.

Hoffman eventually got enough funding to market the device initially to boaters, who were willing to pay $3,000 apiece. The price has since dropped to as low as $99, and today, 24 satellites circle the globe, transmitting signals 24 hours a day.

From a staff of only five workers, the firm has grown to more than 350 employees and more than $80 million in sales in 10 years. Magellan won a $2-million contract in 1990 to supply American and allied soldiers during the Persian Gulf War with the devices to help them find their way in the desert.

In 1994, Inc. magazine named San Dimas-based Magellan the 68th fastest-growing private firm in the country.

By then, Hoffman had divorced his wife of 10 years, Julie, an accountant, and married his second wife, Brenda Lynn, who was then a 19-year-old college student. They have four children and live in Thousand Oaks.

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Hoffman can’t recall the exact day he decided to seek political office but said the idea was probably planted in his head in 1980 when he watched Ronald Reagan at the Century Plaza Hotel celebrate his presidential election.

Hoffman said he remembers telling himself: “Here is a man who truly wants to change things.”

Hoffman doesn’t share Reagan’s politics though. Instead, he sees himself as a moderate Republican who supports gun control and a woman’s right to choose abortion.

He feels strongly about reforming the education system, he said, because, as an employer, he found that many potential workers didn’t have the education to compete.

“There were a lot of opportunities we could not take advantage of because we could not find the right people,” he said.

But critics, such as Joe Gelman, one of Hoffman’s Republican challengers, say Hoffman has taken an interest in such issues as education only recently to create a better public image.

“There is no substance, all fluff,” Gelman said.

Three longtime friends say Hoffman has long expressed an interest in running for office but has only recently begun to discuss specific issues, such as taxes and the school system.

“More recently, he has been more involved in studying the issues in his local area,” said Michael McGee, a Los Angeles-based developer who has known Hoffman for more than 25 years.

Co-workers describe Hoffman as patient, intelligent and a good listener.

“He comes off as very reasoned, sensible, not outlandish,” said Mike Swiek, who heads a trade organization for the satellite navigation industry. “No matter what the situation was, he just listened very, very well.”

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Heading Hoffman’s campaign finance committee is Boeckmann, the owner of Galpin Ford in North Hills. Boeckmann and 12 Galpin employees have contributed nearly $7,000 to Hoffman’s campaign.

Boeckmann said he doesn’t know much about Hoffman’s political agenda but supports him because “he was highly recommended by others and was very successful in business.”

Seven months after Hoffman filed to run for office, Gov. Pete Wilson appointed him to the state’s Domestic Violence Advisory Council, a panel that makes recommendations for grants to domestic violence shelters. Hoffman calls himself a longtime Wilson supporter, but said the appointment was not politically motivated. Hoffman and other Magellan employees have contributed a total of $8,000 to Wilson campaigns over the years.

“Domestic violence is a very personal issue to me,” he said.

It is already clear that Gelman and Sherman plan to pressure Hoffman to make clear his political agenda and defend his personal record in the community.

“He has never done anything in the public arena,” said Parke Skelton, Sherman’s campaign consultant. “He has gotten away with running for office for a year without taking a position.”

In response, Hoffman touts his membership in two nonprofit groups--one calling for the breakup of the Los Angeles Unified School District and another dedicated to protecting children against molesters. Representatives of both groups say Hoffman joined within the last year or so.

Hoffman said he strongly favors breaking up the LAUSD to bring more autonomy to parents and teachers. His own children attend a private school in Calabasas with an annual tuition that ranges from $6,900 to $9,450.

“I have the right as a citizen to fight for quality education for all our children,” he said.

If elected, his ultimate goal is to make a difference, he said. “I don’t want children to grow up the way I did.”