Daryl Kollman and Marta Carpenter built a $193 million empire selling blue-green algae supplements. Their company, Cell Tech, grew rapidly after its 1982 founding. Regulators later banned its core product, leading to a spectacular collapse. The business went from a gold rush success to a courtroom battle, leaving its founders marginalized.
Kollman began harvesting and selling blue-green algae supplements in 1982. He designed the equipment. Marta Carpenter, his then-wife, managed operations. By 1990, they owned the entire enterprise through two shell corporations: The New Earth Co. and The New Algae Co. Each partner held a 50% stake in both entities.
Cell Tech's growth was swift. In 1990, the company reported $10 million in revenue. Six years later, gross receipts reached $193 million. The company sold its products through 350,000 individual distributors across the United States and Canada, operating at the peak of network marketing.
The Oregon Department of Agriculture then intervened. In the mid-1990s, regulators banned algae products containing more than one part per million of microcystin, a naturally occurring toxin. This safety rule proved catastrophic for Cell Tech.
Sales did not just decline; they collapsed. Customers panicked over contamination fears. The company faced millions in unsold inventory and harvesting equipment sized for an operation three times larger than the diminished market could support.
The financial figures tell a stark story. Cell Tech's receipts plummeted to $113 million in 1997, an $80 million drop within a single year. By 1998, revenue fell to $69 million. It continued to shrink, hitting $52 million in 1999 and just $37 million in 2000. The company was bleeding funds.
In a move of desperation, Kollman and Carpenter took Cell Tech public in August 1999. This reverse merger created Cell Tech International, Inc. The change forced Kollman out of management, though both founders retained over 40% ownership each. Carpenter assumed the roles of president and CEO.
Going public did not save the company. The same month as the reverse merger, they signed a financing agreement with a private investor. This decision ultimately stripped them of control. By late 2004, that investor owned more than 90% of the company. Kollman and Carpenter's original stakes were diluted to insignificance.
The company later rebranded and relaunched as New Earth in September 2013, continuing its work in health and wellness. But the empire built by Kollman and Carpenter was gone, and what remained was a shadow of the business they started from harvesting ponds in 1982.