Mines News

Common threads weave together the distinguishing features of successful, high tech startup companies. Their founders are often young, bright, and driven professionals who are keen on seeing their research and innovation develop in the marketplace. These small companies find a problem and fix it; they find a niche and fill it; and sometimes their efforts create entirely new markets. The founding of RE/SPEC Inc. (RESPEC) is parallel to the stories of many fledgling, high-tech startups of today: it began with friends around a kitchen table who committed their own money, expertise, and energy to the endeavor. The only difference is that RESPEC originated 50 years ago, in tandem with the dawn of the information age.

In the late 1960s, South Dakota School of Mines & Technology was focused more on graduating top-tier engineers and scientists and less on fostering cutting edge research. Paul Gnirk (MinE 59), PhD, and other founding members seized the opportunity to form RESPEC (short for Research Specialties). “There were things we wanted to do that we could not accomplish through the college. So, we set up RESPEC, and we started hiring Mines students, and it grew,” says Gnirk. The company enjoyed initial successes in the field of nuclear-waste disposal. Gnirk landed an early contract with Oak Ridge National Laboratory in Tennessee to develop better technology for disposing radioactive waste in deep salt formations. Like almost all startups, RESPEC struggled through some lean times in the early years. “It was hand-to-mouth for several years,” says Earl Hoskins (MinE 56), PhD, with a laugh. But RESPEC thrived following its humble beginnings, “because we employed cutting edge technology in numerical analysis, laboratory rock testing, and modeling. We did what no one else was doing in a better way than anyone else could,” says Gnirk.

Over the years, that growth has included hiring a steady stream of Mines graduates who formed a backbone of the company and were happy to find employment in the Black Hills. “Dr. Gnirk’s original vision was to keep graduates from Mines in South Dakota rather than having them go out across the world to find jobs. He thought there was enough capacity of students coming out of Mines that he could start a company,” says former CEO and President Tom Zeller (ME 70).

Mines graduates provided RESPEC with computer scientists and engineers who could deal with complex data and innovate new hardware and software solutions. Mines also provided engineers and scientists who thrived across disciplines and could undertake complex problem-solving. “We had to have a laboratory,” says Gnirk. In 1981, the company completed its 1,000-square-foot office and laboratory in the heart of Rapid City’s industrial business park. The combination of rock mechanics experts, state-of-the-art laboratory facilities, and engineering and scientific expertise converged to serve RESPEC’s clients in ways others simply could not match.

Several other key elements marked RESPEC’s early success, including an unwritten policy that allowed RESPEC personnel to employ the soft skills needed for building essential customer relationships. “We didn’t talk to clients about work after five o’clock in the afternoon,” says Gnirk. “So our clients knew if they had a beer with us after work, they would not be pressured with sales. Because of this, we were invited to birthday parties, anniversaries, weddings, and all sorts of events on weekends.” These off-work events with clients allowed Gnirk and others at RESPEC the opportunity to establish and maintain personal relationships and trust, which inevitably led to more contracts.

Like all legacy companies, RESPEC also had to survive challenges, including finding financial backing and support, managing cash flow, creating an industrious workforce, and building a permanent workplace. In 1987, after finally finding a place of relative financial and technical stability, RESPEC faced possibly the most tumultuous event in its history when United States Congress amended the Nuclear Waste Policy Act. The abrupt move, which terminated all but one study for nuclear waste disposal, eliminated nearly 50 percent of RESPEC’s projected income overnight.

Despite this devastating blow, the company remained resolute and nimble and adapted to meeting the needs of an evolving marketplace. Over the next few years, RESPEC took the talents and skills originally developed in the nuclear-waste disposal field and shifted into the commercial sector. Today, RESPEC operates in three major areas: mining and energy, water and environment, and data and technology. The company serves a global list of clients including Sandia National Laboratories, Microsoft, and the National Park Service.

In 1992, the company began an employee stock ownership plan, giving employees a vested interest in the company’s success. RESPEC now has 300 employees who provide services in 40 states and 26 countries. “It has grown beyond any rational belief at this point,” says Hoskins. RESPEC has expanded its operations alongside the university. Since 2000, the company has hired one hundred SD Mines graduates. In total, RESPEC employs 215 engineers and 40 percent of them hold advanced masters or doctoral degrees. RESPEC also employs ninety technologists that include system architects, database managers, and software engineers.

Despite unimagined growth, the company remains true to its roots—its success is still built on bridging the theoretical with the applied. RESPEC continues to thrive by offering creative solutions to some of the world’s greatest challenges. For example, RESPEC has led these five major research projects in the last four years: (1) A rock melt borehole sealing system that includes melting rock to make a seal that is less permeable than the original rock, (2) a deep borehole field test that involves scientifically validating drilling technology for a five-mile-deep borehole to explore deep underground waste disposal, (3) real-time hazard recognition using video gauge technology to monitor ground movement and impending hazards in underground mines, (4) a fully autonomous unmanned aerial vehicle solution that uses simultaneous localization and mapping to improve underground drone flight for mine safety, (5) and development of numerical models that can predict borehole breakouts induced by thermal expansion for determining in situ stress.

“We are a humble bunch of engineers, scientists, and technologists,” says Todd Kenner (CE 83), current RESPEC CEO and President. “If you have any kind of knowledge of the business community, 96 percent of businesses don’t survive past ten years. So, we’re in a rare group of companies who have survived for a long time.”

Today, an increasing number of tech-based startups in the Black Hills are trying to recreate what RESPEC pioneered 50 years ago. If the success of RESPEC during the past half-century is any indication, this company will continue to lead the way for the next fifty years.

Photo caption above: Three of the founding members of RESPEC during the celebration of the company’s 50th anniversary are Mike DeMersseman, Dr Paul Gnirk (MinE 59), and Dr. Earl Hoskins (MinE 56).