Outstanding Directors 2022: John Bergstrom
Other board service
The Big Know (2015–2020)
Creative Publishing (1999–2020)
Early Learning (2012–2019)
Dolan Media Co. (1994–2003)
Capella Education (1993–1997)
Most boards have talented and qualified members, says Toby Dayton, president and CEO of Minneapolis-based employment data company LinkUp Inc. He values diverse opinions, backgrounds, and perspectives. What produces a great board, he says, is “a chair who has the ability to work with and sync up with all of those various perspectives—and allow that board to reach agreement about the shared vision of the company.”
Dayton works closely with LinkUp’s chairman, John Bergstrom, whose board service for the company dates back to 2001—about as long as Dayton (who became CEO in 2008) has worked there. Bergstrom has helped LinkUp successfully navigate major and sometimes challenging changes in its business. “John has seen the entire life cycle of the company,” Dayton says. “And he’s been valuable through its growth and evolution along the way.”
Bergstrom was launched in his directorship “career” through Minnesota-based venture capital firm Cherry Tree, where he worked as a vice president starting in 1985. “Adding value by being on boards is very common in venture capital,” he notes. In 2001, Minnetonka-based Cherry Tree shifted from a VC firm to an investment bank specializing in selling companies to strategic buyers. Bergstrom became an independent investor, and “sort of adopted [board service] as a lifestyle.”
Numerous small, growing companies have benefited from his deep experience establishing corporate governance. When a company launches, typically the management is the board. But once a young business takes on outside investors, proper governance on senior executive compensation is necessary. Bergstrom believes that a board also should be involved in budgets, audits, and the strategic plans to which the company holds itself accountable.
During operations as a VC, Cherry Tree invested in a Fargo-based startup called JobDig, which soon moved its headquarters to the Twin Cities. JobDig was a multimedia recruitment advertising business combining print, web, and broadcast media advertising. Several years after launching, JobDig started a division called LinkUp, which combined a pay-per-click job search engine along with an employment data business that gathers job openings from company websites.
“Knowing the details of all those company job postings is of great interest to many buyers,” Bergstrom says. One of the biggest markets for this data is the human capital management industry, which includes HR technology and software, payroll services, and talent recruiters. LinkUp’s data offers these companies real-time, granular insights into the labor market that they can use in their own business or share with clients. Another major market is the capital markets industry.
In June, LinkUp sold its job search engine to a competitor, London-based Adzuna, to focus on its more distinctive employment data business, which now is expanding into other English-speaking countries.
Though now very focused, LinkUp is broadly held, with more than 200 investors, none of whom holds a majority stake in the company. And though it’s not publicly traded, “we operate more along the lines of a small public company,” Bergstrom says, with less ad hoc organization than most private company boards. There are three formal board committees—audit, compensation, and governance—as well as quarterly meetings of the entire board. “It’s our responsibility to look out for all of the shareholders,” he says.
About 10 years ago, when it was shifting its business model toward data gathering, the company needed to take in new money in a “down round.” Adding investors can lower a company’s price per share, a situation that’s always difficult, Bergstrom notes. “And I’d like to think I was part of helping Toby mediate that situation to a successful resolution.”
Bergstrom says that his role was to counsel and support Dayton as he led the difficult negotiations and hammered out an agreement on the financing terms that established the new, lower share price. The parties ultimately agreed on a reduced valuation in exchange for the new dollars coming into the company, an arrangement that still preserved meaningful value for longstanding shareholders. Bergstrom’s talent as a mediator is one of his strengths, Dayton says. “We’ve had a fantastic working relationship for two decades.”