26 Most Fascinating Entrepreneurs: Michelle Cardinal Tim O’Leary

Michelle Cardinal & Tim O’Leary Cmedia and Respond2

for rewriting the rules for husband-and-wife teams

Husband-and-wife business teams are common enough that they even have a nickname, “copreneurs.” When the arrangement works, it works well; when it doesn’t, a couple can be crippled both emotionally and financially. Michelle Cardinal and Tim O’Leary have come up with a novel way of doing the “for richer, for poorer” thing as business partners — they decided not to share ownership completely. Each spouse runs an independent company in the infomercial business, even though they work together all the time.

Wife Cardinal, 37, is the CEO of Cmedia and husband O’Leary, 45, is CEO of Respond2. Together, the couple and their 100-odd employees have created spots for NordicTrack, KitchenAid, Stanley tools, the Songbird hearing aid, and those best of Johnny Carson DVDs that surged in sales after the comedian’s death in January. O’Leary’s team produces the infomercials; Cardinal’s group holds inventory for some of the product lines and manages the sale from pricing to buying airtime to telemarketing and fulfillment. “I always joke that we talk shop in the shower,” Cardinal says. (They also co-own two smaller firms 50-50).

Interestingly, a wide gap in terms of revenue exists between the companies. Respond2 grossed $10 million last year, compared with Cmedia’s $100 million haul, half of which came from serving clients whose infomercials were not shot by Respond2. The remaining two firms kicked in an extra $10 million. “Michelle made more than I did last year,” O’Leary freely admits. The arrangement still suits them, Cardinal explains, because “our egos are too big to tell each other what to do. It only works because I have my thing and Tim has his thing.”

That strikes Kathy Marshack, author of Entrepreneurial Couples, as a shrewd insight. “Lots of husband-and-wife teams won’t acknowledge their competitive personalities, so this sounds like an ideal setup because it levels the playing field for each one’s strengths,” she says. Plus, Marshack notes, it avoids a common copreneurial mistake: “Not paying the wife a salary.”

In certain ways, Cmedia and Respond2 operate as one. They share an 18,000-square-foot headquarters in an old dairy festooned in Tonight Show memorabilia. Their websites are also noticeably similar, featuring the same breakeven calculator for potential customers. And one monthly executive summary tracks key numbers of both companies. On the flip side, the firms pay taxes separately, and Cmedia bills Respond2 for accounting and vice versa for Web maintenance.

There is, however, one not-so-far-down-the-road issue that will test the arrangement. “For the first few years, I thought we wouldn’t have children,” says Cardinal, in an everyone-asks-that tone. “But we just built a new house with a nursery.”

Patrick J. Sauer

1. Martha Stewart, Martha Stewart Omnimedia

   because she took one for the team

2. Richard Branson, Virgin Group

   because he’s game for anything. In fact, everything.

3. Michael Dell, Dell Computer

   for being brilliantly straightforward

4. Jim Sinegal, Costco

   because who knew a big-box chain could have a generous soul?

5. Diane von Furstenberg, Diane von Furstenberg Studio

   for staging an elegant comeback

6. Julie Azuma, Different Roads to Learning

   for offering hope and help to the parents of autistic children

7. Fritz Maytag, Anchor Brewing

   for setting limits

8. Ray Kurzweil, Kurzweil Technologies and other companies

   because he is Edison’s rightful heir

9. Craig Newmark, Craigslist

   for putting the free in free markets

10. Jack Mitchell, Mitchells/Richards

    because his family business makes an art of customer service

11. Frank Robinson, Robinson Helicopter

    for whipping an entire industry into shape

12. Mark Melton, Melton Franchise Systems

    for giving immigrants their shot at the American Dream

13. Michelle Cardinal & Tim O’Leary, Cmedia and Respond2

    for rewriting the rules for husband-and-wife teams

14. Mike Lazaridis, Research in Motion

    because someone had to stand up for all those frustrated engineers

15. Trip Hawkins, Electronics Arts and Digital Chocolate

    for still scrapping

16. Warren Brown, Cake Love and Love Cafe

    because only in America will someone quit a secure job as a lawyer to start a bakery

17. Muriel Siebert, Muriel Siebert & Co.

    for being a notable first with a worthy second act

18. Chuck Porter, Crispin, Porter + Bogusky

    for verging on reckless

19. Katrina Markoff, Vosges Haut

    for setting a completely unreasonable goal for her business

20. Barry Steinberg & Craig Sumerel, Direct Tire and Auto Service

    for showing the power of the peer group

21. Victoria Parham, Virtual Support Services

    for serving as a mentor to military spouses

22. Tom LaTour, Kimpton Hotels and Restaurants

    for staying at fleabag hotels so that we don’t have to

23. Mitchell Gold & Bob Williams, Mitchell Gold

    for creating a true comfort zone

24. Izzy & Coco Tihanyi, Surf Diva

    for kicking sand in the face of conventional wisdom

25. Tony Lee, Ring Masters

    for saving 16 jobs, including his own

26. Rueben Martinez, Libreria Martinez Books and Art Galleries

    for simultaneously building a business and nurturing Latino culture