He arrived in Watsonville on a foggy August day. Harlin had built the business to four locations when he sold Coast Gas to Baxter and his partner Charles Kittrell, now the COO of Cornerstone. Within 10 years, the company grew to 50 locations. And by 1996, the company entered a master limited partnership with Northwestern Corp., a South Dakota utility company, and went public. Today Cornerstone has over 460,000 residential customers at 300 locations in 34 states.
Propane is also a small industry.
Only 3 percent of households in America use propane instead of electricity or natural gas to heat their homes. Most of propane's best customers live in rural areas like the Santa Cruz mountains where there are no gas lines. Filling trucks called bobtails carry propane to the home and pump propane into gigantic tanks that look like the smaller ones that sit under a barbecue grill. Since propane is a product of crude oil, rising oil prices coupled with warmer winter weather will leave some smaller propane shops vulnerable, Baxter said. In 1989, Baxter made sure Cornerstone customers would never run out of gas by becoming a wholesale propane marketer.