Bill Kling conquered Minnesota radio, but can he save NPR?

Bill Kling

Bill Kling

Bill Kling emerges from the crowd, his stark white hair instantly attracting the eyes of the audience. He occupies the podium with the practiced confidence of a Fortune 500 CEO.

As he often does, Kling recites a quote from Thomas Jefferson to highlight the importance of his mission: "When the people are well informed, they can be trusted with their government."

It's vintage Kling—his personal ambition dressed up in populism—and the audience hangs on his every word.

After he concludes his speech, Kling prepares to step away. But he lingers a moment, as if he has forgotten something. An impish grin flits across his face, and Kling leans into the mic for one last utterance.

"Go out there and flash those signs," Kling says. "And give them hell!"

To hear Kling tell it, the fate of public radio itself is at stake. With "austerity" being the watchword of the day, Republicans suggest that taxpayer funding for nonprofit broadcasts is an expense the government can no longer afford.

Even as a young entrepreneur, Kling was a visionary of the industry

Even as a young entrepreneur, Kling was a visionary of the industry

That poses a direct threat to the fiefdom Kling has spent the last four decades building, and he's not giving it up without a fight.

After he retires on July 1, Kling plans to take his show on the road and use his influence to build up public radio stations across America. Other than MPR, he's eyeing Chicago's WBEZ, New York's WYNC, and KPCC in southern California. Ultimately, Kling hopes to take on all the top public radio markets in the country.

In an industry driven by soft-talkers and small community stations, Kling has always treated Minnesota Public Radio like big business. He's credited with inventing the notion of "Social Purpose Capitalism"—the idea that a nonprofit should be steered with a capitalist's eye.

"There was behavior and a mindset that looks more like Microsoft or Cisco than it does like your typical community arts organization," says James Phills, who teaches a case study on Kling at the Stanford Graduate School of Business. "There were people who viewed it as kind of unseemly."

Much of this success came from creating private companies to partner with MPR. While most public radio stations rely solely on federal funding and member drives, Kling bankrolled MPR's growth with tens of millions in revenue generated by his private companies.

This unusual strategy has stirred up no small controversy. In the 45 years since Kling started his station, he has battled politicians, competing radio stations, and the state attorney general. He's never shrunk from the challenge—to the contrary, he seems to relish the fight.

"Whenever there's a conflict, I'd much rather be on his side of the battle, because he is tenacious and single-minded," says George Latimer, former mayor of St. Paul. "He's got sharp elbows. He's not afraid of taking on anybody or anything if he feels whatever it is gets in the way of the mission of MPR."


TOWARD THE END of his senior year in college, Kling was still unsure of his next move. He knew he wanted to go to grad school, but was torn between business and communications.

This changed after a meeting with Colman Barry, a crew-cut monk. Barry was intrigued by Kling's lifelong fascination with radios and his work as the manager of St. John's University's student-run station. So he made Kling an enticing offer: If he chose communications, St. John's would pay his tuition—on the condition he come back upon graduation and start a radio station.

The offer sold Kling. He shipped off to Boston University to learn the radio trade.

By the time Kling returned, Barry had mounted a campus-wide campaign to start the radio station, called KSJR, or Minnesota Education Radio.

"The idea was that you would have music and educational programs," recalls Father Hilary Thimmesh, the academic dean at the time. "I remember the president giving a pitch about how it would benefit Stearns County dairy farmers, as they would go out to do their chores to the sounds of Mozart or Beethoven or whatever."

Barry didn't skimp on the expenses. On St. John's dime, he renovated the vacant third floor of an old campus building, re-paneling the old walls with handsome woodwork that almost covered up the lingering smell of formaldehyde. He filled the station with top-of-the-line equipment, some custom-engineered specifically for the school.

Kling was 26 when the station went on the air in 1967, but he appeared unimpressed with the counterculture movement of the time. He was a suit-and-tie man, hair always greased into a careful part, and carried the seriousness of someone much older.

Garrison Keillor's <em>A Prairie Home Companion</em> was key to Kling's commercial success

Garrison Keillor's A Prairie Home Companion was key to Kling's commercial success

Employees remember him as a taskmaster who pressed them into 60-hour work weeks just to keep up. The hard time paid off: KSJR was an instant hit with its central Minnesota audience.

But it wasn't until Kling met Garrison Keillor that he found a persona large enough to fulfill his grand ambition.


TODAY, GARRISON KEILLOR is one of the most identifiable voices in radio. Though his show is about a parochial central Minnesota town called Lake Wobegon, he has captured the imagination of a worldwide audience, even inspiring a Hollywood film.

On a May morning, Keillor calls to apologize for missing a phone interview scheduled for the day before. He was at a matinee performance of a play in New York, he explains, then made a spur-of-the-moment decision to catch a showing of the new Kristin Wiig comedy Bridesmaids.

"Which was..." Keillor says, pausing as if trying to find the words to describe a fine wine. "...Fantastic."

Back in 1969, Keillor wasn't even interested in radio. He fancied himself an author, waiting eagerly for the inspiration to write the great American novel.

Father Colman Barry asked Kling to help him start a central Minnesota station

Father Colman Barry asked Kling to help him start a central Minnesota station

Keillor was also the father to a newborn son, however, and in need of a full-time job to pay the bills. He'd heard the rumors about Kling's demanding nature, but applied anyway for the morning shift at KSJR.

Keillor looked the polar opposite of Kling. He showed up to the interview with shaggy hair, a long beard, and jeans. He was shocked at the serious, be-suited man of the same age on the other side of the desk.

But Keillor got the job, mostly because he was willing to show up at 6 a.m.

If he was put off by Kling's serious demeanor, Keillor was nonetheless impressed by his radio chops.

"He had a love of old radio; he listened to the same shows I had listened to in the waning years of the so-called golden age," says Keillor. "To him this was a noble thing, and a noble enterprise."

Kling and Keillor never had much of a personal relationship—to this day, Keillor professes ignorance about his boss's tastes in music and politics—but the two made a formidable team. Kling was a visionary of the radio industry, while Keillor had a natural talent for storytelling and entertaining.

"I can't ever recall a time where I ever thought he was bullshitting me or trying to impress me," Keillor says of Kling. "It's kind of an unusual thing in that world."

Gary Eichten and Bob Potter would find long careers in what began as a humble radio station

Gary Eichten and Bob Potter would find long careers in what began as a humble radio station


AROUND THE TIME A Prairie Home Companion was beginning to become popular in Minnesota, a man named Rich McClear was getting ready to launch his own public radio station in the small mining and timber community of Grand Rapids, Minnesota.

McClear was a young, dark-haired man with a beard and a progressive idea: Instead of playing classical music or educational programs, his station would mirror the community it served. In Grand Rapids, this meant polka music, programs about Finnish culture, and letting the town's poets recite their work on the air.

McClear didn't have much financial backing, so it would be a humbler operation. He called it Minnesota Public Radio.

This name did not sit well with Kling. Soon after going on the air, McClear began receiving letters from Kling's lawyers claiming he'd committed copyright infringement because KSJR had once referred to the station as "Minnesota's public radio" in a programming guide, he says. Kling told a new governor's task force on public radio that McClear's station wasn't financially viable and shouldn't be allowed to share federal funds.

"Before we went on the air, we spent a lot of time preoccupied with Minnesota Public Radio, with Bill Kling," says McClear. "A lot of time looking over our shoulder."

McClear ran in some of the same circles as Kling. When they bumped into each other, Kling would try to convince him to change the name of his station.

"You're a community radio station," McClear remembers Kling telling him. "Why don't you call yourself 'something community radio'?"

Other broadcasters eventually began protesting along with Kling, complaining that "Minnesota Public Radio" should be a moniker all public radio stations in the state could use. The criticism eventually persuaded McClear to give up the title and change his station name to Northern Community Radio.

Three months later, Kling trademarked "Minnesota Public Radio" and changed the name of his company. McClear had been hoodwinked

"I wish I wouldn't have dropped the trademark," McClear says, still smarting. "We could have sold it."

McClear wasn't the only one trying to fend off Kling's growing influence. Another station, named Fresh Air and later called KFAI, was trying to break into the public radio world on a 10-watt frequency.

When Kling found out Fresh Air had applied for a license, he petitioned the Federal Communications Commission to deny it. The complaint was twofold: Fresh Air's signal could interfere with Kling's, and Fresh Air didn't have enough money to sustain the station.

"Once this petition to deny was filed, pretty much the community support drifted away, because it was going to be a long battle," recalls Jeremy Nichols, who was on the Fresh Air board of directors at the time.

The legal arguments went on for three years, until the FCC finally sided with Fresh Air. When Kling found out, he was outraged. He threatened to appeal the FCC's decision and more.

"If we are denied relief again, we will consider an appeal to the Court of Appeals in Washington," warned Kling in a letter. "This matter is so important to the viability of public radio networks, both ours and others throughout the country, that we would be remiss in not pursuing the matter to a final determination."


THE FIRST TESTAMENT to A Prairie Home Companion's enormous fan base came in 1981 and involved a made-up product called Powdermilk Biscuits.

During one of his live shows, Keillor offered listeners a free poster advertising the fake sponsor. All they had to do was write in.

His studio was quickly inundated with about 50,000 requests.

MPR was overwhelmed by the demand. Filling all those orders would be a huge hit to the pocketbook.

Then one of the producers had an idea: The backs of the posters could be used to advertise T-shirts that would be sold for a profit.

The response went beyond anything they could have imagined; MPR actually ended up making around $15,000.

Recognizing a market, MPR started Rivertown Trading Company, a mail-in catalog. Keillor was a marketable commodity, and MPR was going to reap the rewards.

The early-1980s technology had put a glass ceiling on Keillor's audience; he was bound to MPR's Minnesota airwaves.

A few years later, satellite technology began to emerge and Kling saw an opportunity to bring Keillor to a national stage.

In 1983, Kling met Frank Mankeiwicz in a Phoenix hotel room after an NPR conference. Mankeiwicz was the brash president of NPR, and was feverishly trying to survive President Ronald Reagan's massive cuts to federal funding.

Kling, a founding board member of NPR, pitched an idea: Using satellite technology, NPR could expand its repertoire by syndicating programs from public radio stations around the country.

Mankeiwicz's answer was a swift and resounding, "No."

After the meeting, Kling and his business associates rallied by the hotel pool to discuss their options.

NPR had a monopoly on the national airwaves, meaning they got all the federal funding. To produce new programming would mean creating a separate entity that would directly compete with NPR.

Later that year, Kling launched American Public Radio—later renamed Public Radio International—NPR's first serious competitor.

When Kling left NPR, it was not on friendly terms, says Mankeiwicz. It also wasn't surprising.

"Bill's a tough businessman," says Mankeiwicz. "He's ambitious. He wanted to be a leader of public radio."


KEILLOR WASN'T THE only one benefiting from the success of A Prairie Home Companion, which had become popular with a national audience.

Rivertown turned into a multimillion-dollar, for-profit business. Kling also started publishing a magazine called Minnesota Monthly under the umbrella of Greenspring Company, MPR's for-profit partner. Kling was no longer just the CEO of MPR—he was in charge of a commercial enterprise worth hundreds of millions of dollars.

This put Kling and MPR in an unusal position. Greenspring paid millions a year to the radio nonprofits through royalties, charitable donations, and dividends, but MPR still received several million in federal funding from taxpayers. And because MPR was a nonprofit, it retained tax-exempt status.

This magnitude of commercial success for a nonprofit starting a private company was unprecedented, explains Stanford Business School's James Phills.

"The reality is that a lot of those businesses don't actually make money," says Phills. "Minnesota Public Radio, and its earned-income, was really remarkable in terms of being successful as a business."

The fact that Kling was running the whole show was bound to stir up controversy, says Phills. "It's more likely to raise eyebrows than if Greenspring had completely different people that were in fact not playing roles in both organizations."


SOON AFTER MATT Entenza, a towering, long-faced attorney, was elected to a seat in the Minnesota House of Representatives in 1994, he made an enemy in Bill Kling.

Entenza proposed forcing nonprofit CEOs to disclose their salaries, even those made in partnering for-profit companies.

Though Entenza was only 34 and a freshman legislator, he was familiar with the subject matter. He'd spent the last five years as Minnesota's assistant attorney general, unraveling charity fraud cases and complicated white-collar crimes.

Entenza expected opposition. Minnesota is headquarters to many healthcare companies, and that meant plenty of high-powered executives would rather keep their books private.

But to Entenza's surprise, only one man opposed him: Kling.

As the law stood, Kling didn't have to disclose his salary with Greenspring. As far as the public knew, he was making only $75,000 a year, his relatively meager public salary with MPR. Entenza's bill would force Kling to reveal his private salary, which was much, much higher.

Kling sent MPR's team of lobbyists to defend against Entenza. The radio owner also went on the air to enjoin listeners to oppose the bill, arguing that the law would give his business competitors an unfair advantage.

Entenza was deluged with complaints from pissed-off MPR listeners.

"What I saw were members of the public who thought they were opposing a bill that Kling was arguing would hurt the ability of MPR's business to function effectively," says Entenza. "The reality was, it wasn't about that; it was about keeping his salary private."

Kling's relentless opposition made Entenza suspicious. He figured that if Kling would go to such extremes, he must have something to hide. This and other issues inspired Entenza to file a complaint against Kling with the state attorney general.

The AG took the case, and began an investigation. When the press got wind of it, the story was splashed on the front page and roused even more questions from the public.

"I'm sorry, but you can't call yourself a public radio station and act like you're a private one," says former St. Paul Mayor George Latimer. "It's kind of like a candidate refusing to share his income taxes. It ain't gonna work."

When the bill finally passed in 1997, Kling was forced to disclose to the public that he was raking in $526,945, making him the highest-paid CEO of any nonprofit arts and cultural organization in the Twin Cities. Keillor's salary wasn't far behind, at $368,000.

The attorney general's investigation found nothing illegal about Kling's business, though there was some blurring of the lines. The AG made a few stipulations going forward, including mandating that MPR hire an independent analyst to monitor its salaries.

That year, Kling sold Rivertown to Target Corp. for $120 million, personally pocketing $2.6 million.

Though Entenza had technically won the battle with Kling, he was left with a permanent black mark on his career in the eyes of MPR listeners. When he ran for governor more than a decade later, people would often tell him that they refused to vote for him because of what he did to MPR.

"I just don't think a nonprofit, particularly a nonprofit broadcaster, should become a bully pulpit for someone," says Entenza. "And that's what it's been for Kling."


A FEW YEARS after selling Rivertown, Kling was thinking about retirement. It had been a fun ride, he told a committee of the board of directors, but it might be time to let someone else take the reins.

The board wasn't ready to let Kling go. Instead, board members convinced Kling to sign a five-year contract—the first one he had signed since starting the station.

The board had good reason to keep Kling around. He had just bought Marketplace, a popular business and economics show that was an instant hit with MPR listeners. He'd also bought a college station in Pasadena, California, meaning Kling's empire now had a West Coast franchise.

In 2004, Kling helped start American Public Media, a new parent company to MPR. With APM, Kling continued conquering the public radio map. APM bought Classical South Florida in Miami. Kling expanded MPR, which now owns 42 stations. Today, APM is the second-largest public radio company in the country, next to NPR.

APM set a new national standard for quality public radio, says Ken Doctor, a media analyst for Newsonomics. It also completely restructured the marketplace for how national programming was produced and sold.

"He proved out the model, and now NPR, through skillful use of technology and similar syndication model, could work," Doctor says of Kling. "In so doing, he's opened eyes."


THE HEADQUARTERS OF MPR in downtown St. Paul is a massive piece of architecture, taking up an entire city block. One needs a security badge just to get past the front desk.

On a Tuesday morning, Kling ruminates in his second-story corner office, sunk into a black leather chair.

Though Kling is retiring on July 1, he isn't walking away from his lifelong pursuit. He plans to employ his influence to raise $5 million a year for five years, which will be used by four public radio stations to hire more reporters. Another $5 million per year will be donated to the greater public radio system.

He believes MPR's current newsroom staff of 86 needs to double.

"You can have all the blogs, all the Huffington Posts, and Twitter feeds, and any other way of distributing content," Kling says. "But if you don't have the content, none of it's worth anything. That comes from reporters, which I believe we have to step up."

When talk turns to the many criticisms of his style, Kling doesn't flinch. Most recently, he's been on MPR advocating against a congressional bill that would cut federal funding to public radio. Some say Kling overstated the threat to bring in more donations. He was also criticized for using his taxpayer-funded radio station to push a political message.

Kling defends himself by saying that only 6 percent of MPR's budget is paid for by taxpayers.

"I promise you that we don't use any of that 6 percent to record what I put on the air," he says.

Kling doesn't deny that he's flexed MPR's muscles when someone or something has threatened his business.

"We've had a policy since we started of telling our constituents what they need to know," Kling says. "And I could write them a letter, but it would cost a whole lot more money than if I put it on the air."

As for his controversial business model, Kling argues it's been for the greater good. Without the money from Greenspring, MPR wouldn't have been able to grow into what it is today.

"There's always critics," Kling says dryly.

For Kling, what's good for MPR has always come above all else, and he makes no apologies.

"I am a harsh competitor," he says. "I have wanted Minnesota to have the best service in the country, and I hope we do. Nobody else has the reach that we have."