Tooling U nails more cash

Tooling U, as it's known by more than 2,000 manufacturing professionals who take its online industrial courses, has received a joint investment by Cleveland venture capital firm Glengary Ventures and Joseph T. Gorman, former chairman and CEO of TRW Inc. The amount of the investment was not disclosed.

Tooling U, a spinoff of Cleveland-based toolmaker Jergens Inc., provides nearly 60 courses that teach manufacturing skills via the Internet. The year-old company expects to get more money from an out-of-town investor this week, said Tooling U president Jack Schron Jr., who also heads Jergens.

As part of the most recent investment, Mr. Gorman will join Tooling U's board. He said he will help Tooling U "wherever I can."

"I've been in manufacturing for 35 years," Mr. Gorman said. "I understand the manufacturing process and I think I understand the training needs of manufacturing companies. I can offer the experience of those 35 years - often full of mistakes and successes."

Indeed, Mr. Gorman already has helped forge relationships between Tooling U and Cuyahoga Community College. The college will offer Tooling U's classes to its students as an enhancement to its curriculum.

Mr. Gorman, who has invested in several local startups and is chairman of Glengary, said he is selective about his investments. But, he added, "The minute I heard about Tooling U was the minute I was interested."

"I found myself engrossed in talks about how they could have a greater competitive advantage," Mr. Gorman said. "I think it's a great idea."

Glengary thinks Tooling U is a fine idea, too, said Steve Haynes, managing director of Glengary.

"Tooling U is a great example of how Cleveland can be a site for technology development, especially where the technology can be applied to the manufacturing sector," Mr. Haynes said. "We are very pleased to be a part of Tooling U."

Mr. Schron said the fresh capital will help the startup distinguish itself from the 61-year-old Jergens, and will help Tooling U double the number of its online manufacturing-related classes to 120 within a year. Mr. Haynes said the latest investment ultimately could help Tooling U "either go public or be sold to a company that's already in the learning management (business)."

For now, Mr. Schron said he wants Tooling U to operate separately from Jergens because it will make it easier to attract outside investors and to form alliances with industrial companies that can provide class content.

While he anticipates benefits from operating Tooling U as a separate corporation, Mr. Schron acknowledges the startup has profited from close ties with the company that birthed it. Jergens provided much of Tooling U's initial financing. Mr. Schron would not say how much Jergens has invested in Tooling U, but did acknowledge that Jergens holds a "significant" ownership stake in the online venture.

Jergens still will provide office space to the nine-person staff of Tooling U, and will allow Tooling U to record actual manufacturing procedures in its machine tool shop. The videos are used as online demonstrations.

Mr. Schron said he wants to increase the number of manufacturing professionals who take online training courses from Tooling U to as many as 50,000 within five years and to expand the breadth of skills taught by the courses. Tooling U is writing many of its courses in Spanish, and it is exploring offering them in Chinese, Mr. Schron said.

Mr. Schron already has built significant partnerships with four industrial trade magazines, which provide for free their archived articles on ToolingU.com. He also received an investment last year from Cincinnati publisher Gardner Publications Inc., which provides Tooling U with two-page, glossy advertisements in trade publications such as Modern Machine Shop. Mr. Schron would not disclose the size of Gardner's investment.

Mr. Gorman said Mr. Schron has "carved out a space that's not been used before" for industrial training.

"It's a cost-efficient way for companies to upgrade their training of people," Mr. Gorman said. "It can be a worldwide - not just nationwide - company in several languages."

Mr. Schron, who served on the Chagrin Falls School Board for 12 years, said the educational value of Tooling U is what drives him to grow the startup. He launched Tooling U to fill the educational gap left by the dwindling number of vocational schools and the demise of manufacturing apprenticeship programs.

The business and educational communities "have not told people it's valuable to make things," Mr. Schron said.

"We've put people in two camps - those who make a living with their hands and those who make a living with their brains," he said. "In today's manufacturing, it's not two camps. There are people who are working with million-dollar machines. I guarantee you they have to use their brains."