The Great Risk Taker

The Reinhard family story is one of hard work, risk-taking, success, and a deep love of community. Claude Reinhard and his wife had five children. Two of his sons—Don and Fred—and his grandson—Dave Masenheimer—recently sat down with the Commonwealth Foundation to share how Claude’s entrepreneurial spirit shaped their family and their community.

It all began with baseball.

In the late 1940s, Claude Reinhard grew frustrated his television only picked up two channels. He wanted channel 10, his sons joke, because it showed baseball. Not one to let a problem go unresolved, Claude ran a cable from his TV to the various types of antennae he installed on a vacant lot next to his home. To his frustration, he still he couldn’t get channel 10.

But he didn’t give up. “He was a chemist. If there was a problem, he sought a solution,” Dave says.

Claude was never one to let challenges stop him. Growing up on a small farm in Northampton County in the early 1900s, he spoke only Pennsylvania Dutch until attending the local one-room schoolhouse. After learning English, Claude excelled in school, eventually becoming a research chemist at the New Jersey Zinc Company. His employer invested in Claude’s higher education and provided him a scholarship to Cornell University.

It was while he was working for the zinc company and raising a family that he resolved to fix the cable problems he was having at his home in Palmerton, about 20 miles north of Allentown. The solution, he knew, was in the Blue Mountains. High up on a mountain behind town, Claude raised an antenna and ran cable down to Palmerton. He recruited investors and ran the cable a block at a time. Claude’s son Fred describes the laborious process: “If we had money, we’d go a block. If we had more money, we’d go another block.”

It worked.

In fact, it worked so well that Claude could no longer manage working at the zinc company while running his cable business. He faced a choice familiar to many entrepreneurs: Stay in a stable, family-supporting job or take a gamble on himself.

You can guess what he chose.

“We have a picture of an old Reinhard family Christmas and no one is looking particularly happy,” says Dave, president of Pencor Services. “We [jokingly] captioned it: ‘This is when the Reinhard family found out Claude was leaving the zinc company to start the Palmerton Company.’

“We call him the Great Risk Taker. This was the story I heard at bedtime from my mom. But he had a vision. He took the role to lead the family in a new direction.”

That risk, and Claude’s entrepreneurial spirit, would impact the Reinhards and the Palmerton community for generations.

The Palmerton Company became Pencor Services, Inc., (Pennsylvania ENtertainment, COmmunications and Recreation) in 1965. Today, the family of Pencor businesses includes cable, internet, telephone, web design, newspapers, printing services, an entertainment venue and more. And that’s not counting the bowling alley, drive-in movie theaters, and laundromats the family has owned along the way.

But the business growth didn’t happen all at once. Establishing the cable business offered Claude a natural entrance into the newspaper business. In the late 1960s, the Reinhards began publishing Cable Grams to inform customers what was on television. From there, Claude became interested in the newspaper business. He purchased the Jim Thorpe Times News and in the next two years acquired newspapers in Lansford and Tamaqua. The family of newspapers continued to grow and now includes eight local papers, independently owned and operated, that form the Lehigh Valley Press. “It’s a way to unite Carbon County and give access to local news. We are local, local, local,” Dave says.

Today, internet service is critical to Pencor, and the story of PenTeleData shows the risk-taking and prescience that Claude passed along to his sons. PenTeleData began in 1994 with the goal of providing affordable broadband internet service to households. It was one of the first companies in the United States to offer internet over cable and, thanks to Don and Fred’s persistence, is now one of the largest privately owned networks in the nation.

“We had some very rough early days. We lost money for a number years,” Dave says. But Don and Fred stayed the course. “It was Don and Fred saying ‘It’s gonna go. Just hang in there.’ We had financial partners that bailed. They didn’t stick around and now they deeply regret it,” Dave recalls, smiling.

Today, Pencor Services reaches more than 200,000 customers and employs approximately 250 in the community.

Fred, Don, and Dave are proud of those numbers.

“I was always taught that the company was about the family and the community. Palmerton is important to Pencor and we are important to Palmerton. There are Palmerton employees right on Delaware Avenue. If we drive down Delaware Ave we can point to six, eight Pencor buildings. We love Palmerton. It’s part of our mission,” Dave explains.

Palmerton is so important to Pencor that the Reinhards have pursued certain ventures not to achieve a certain bottom line but to serve the community of Palmerton. “The ice cream shop might be out of our mission, but Palmerton didn’t have [an ice cream shop],” Dave explains. “So we opened one and named it after my grandfather.” Claude’s Creamery has been in business on Delaware Avenue since early 2011.

Penn’s Peak, a concert and entertainment site, also serves the community, by attracting musicians who otherwise wouldn’t stop in Carbon County. “It’s out of my comfort zone, but whenever I get stressed out, I go to a concert and see everyone enjoying themselves and think, ‘That’s why we do it,’” Dave says.

But their community and family-oriented mission reaches even further. “All along there were opportunities to cash out,” Dave says. “It’s our obligation to resist that urge. We’re trying to grow the company and expand the product line. It’s exciting. There’s still a lot of room for growth…we just need to stay focused on our mission. It’s our obligation to pass [Pencor] down. We’re just custodians of the company that’s here to serve the family and the community.”

Don gets emotional when speaking about his legacy and passing the company to the next generation. “This is our life. Pencor Services is our life. I want to make sure it keeps going.”

That sense of obligation weighs heavily on Dave, Fred, and Don when it comes to how government policies affect their business.

They immediately mention the inheritance tax. When Claude passed away in 1975, the Reinhards lost significant assets to pay the “death tax” so the company could be passed to Don and Fred. Passing the company down to the next generation is expected to be equally—if not more—painful. “There’s a risk we have to sell the company to pay the taxes. That would be devastating to the community and the family legacy,” Dave says. “It’s not about us. We’ll be fine.” But if Pencor doesn’t stay in our family, Dave wonders aloud, will it stay in the community?

The Reinhard family remains deeply committed to Pencor and Claude’s entrepreneurial spirit. Jeff Reinhard, Dave’s cousin and the youngest of their generation, is the CEO of Pencor, and Don, Fred, and Dave rattle off the names of other family members running various parts of the business. The next generation is already at work at Pencor.

And as the Reinhard’s continue serving their community, CF will continue fighting for a Pennsylvania where family businesses like Pencor can thrive and impact their communities for the better.

As Dave says, this is more than a business; its’ a mission: “The Thanksgiving table is like a meeting. Everyone is talking about ideas. That’s just what we do, it’s our reason for getting up in the morning.”