Blackwater alters mission but retains glitz and grit

Erik Prince gets his guests to the runway seconds before the turboprop's approach. The financiers hop out of his black Chevy Suburban and gawk as the pilots drop a pair of packages that float to within feet of their target – just as they might on a mission for Blackwater Worldwide in the Afghan backcountry.

His audience is captivated by the show, but the Blackwater founder and CEO focuses on a seemingly minor detail: the parachutes.

“They're made out of the same stuff sandbags are made out of,” Prince tells the group in hurried, staccato sentences. “They are truly disposable. The normal parachutes you put a human out under are much more expensive. With these, you can use them, repack them. It's very cheap.”

Then it's back in the Suburban – a “sub” in Blackwater talk – as Prince speeds the investors off to their next stop on the tour of Blackwater's campus in the North Carolina swamplands. This is life at Prince's Blackwater: the glitz of business, the grit of military.

In that mix, critics see Blackwater as a company that recklessly abuses the gears of war to make a buck.

Prince and his devoted team view themselves as a military support staff that helps the government save a buck through an obsessive commitment to identifying and fixing inefficiencies in operations and training.

“You can't paint with one broad brush that absolutely applies across this whole place,” Bill Mathews, the company's executive vice president, said during a recent interview with The Associated Press. “This is sort of the quintessential veteran-owned, -operated and -managed company. Almost everybody is a former U.S. serviceman.”

Their work is hardly charity. The scion of a Michigan family that made a fortune in the auto parts business, Prince is pushing his company to reach $1 billion in revenues annually by 2010. To get there, he's decided to scale back the work – private security contracting – that at first drove the company's growth but later made Blackwater one of the most caustic brand names in history.

Prince and another former Navy SEAL founded Blackwater a decade ago, sensing an opportunity to provide training for the SEALs based in nearby Virginia Beach, Va., and for law enforcement officers and others in the military.

The company only started booming after the bombing of the USS Cole and the Sept. 11 attacks, and president Gary Jackson said the government later approached Blackwater about providing private security.

But the work has also earned Blackwater a legion of detractors. The company's workers were involved in two of the defining moments of the Iraq war – the grisly slaying of four Blackwater contractors in 2004 in Fallujah, and a September 2007 shooting at a crowded Baghdad intersection that killed 17 Iraqis – trigging congressional hearings and investigations from more than a dozen federal agencies.

Prince, who for years guarded himself and his business from public scrutiny, has been more open since the Iraq shooting, allowing reporters to scope out operations and probe executives about the direction of the company – all in an attempt to save the Blackwater brand he launched a decade ago.

As part of that, the company told the AP last week, Blackwater plans to scale back its contracting work to a fraction of its business, worried that the cost of doing the work hurts the business's bottom line.

By tapping the expertise of its veterans – from ex-SEALs to former Coast Guard officers to FBI agents – Blackwater instead sees a future in using its mobility and flexibility to seek out and quickly fill other gaps that present themselves.

When Prince noticed a shortage of U.S. combat medics, he developed a school and program to train his own. They practice rescues and vehicle extractions on Blackwater's campus, and Prince is now looking for customers who want to hire medics as contractors.