In August, we were delighted to learn that iPlace had reached #3010 on inc. 5000’s Fastest Growing Private Companies in the US. It truly was an honor to be selected to come to San Antonio on behalf of iPlace to accept our award. I was proud to represent a company that has strong values and I enjoyed networking with people and telling them about what we do.
It was a packed few days. It started on Wednesday morning with Camp Gladiator. It was a workout team-style. The instructors did a number of ice-breakers to help us meet other people. For example, they broke us up into four groups and we had to complete a number of different exercises (sit ups, push- ups, air squats, high kicks, etc.) while building the highest structure we could with a certain amount of blocks. If the structure fell, you automatically were eliminated. Just like building a business, it took a lot of teamwork. Even though we were completely exhausted by the end, we won the competition by having the tallest structure. They gave us a t-shirt as a trophy.
The rest of Wednesday was spent attending different sessions on leadership and networking with 500+ people. It took place in the Marketplace. I met several different people, and they all had a different story. The hard part was not the actual engaging, but instead starting a conversation. We didn’t receive our name tags until Wednesday morning, so it was a bit difficult not knowing what type of company they worked for – it would have been helpful if we had the name tags ready beforehand (Tuesday). That way, we can put a name to a face.
One of the first speakers was Eric Ryan, the co-founder of Method Soap. Eric and his friend Adam co-founded this soap company and they’ve built it into an $100-million-dollar brand. When it comes to scaling and bootstrapping, Eric emphasized culture, product, and in advocacy. The question Eric always gets asked is, ‘How did two guys create a soap company?” He said he never thought he was smart enough to create a business plan and he always liked how Richard Branson would go in and try to disrupt really tired categories. So, Eric and his friend were both trying to think of ‘a really big and boring category and figure out the cultural shift it had missed.’ Eric felt like the soap business was a huge industry, but was a really boring one. When Eric thought about it more, the missing element with a soap company was the life styling of the home. Nobody was thinking about soap as something that you could use as an extension of the home as a design or leave on the top of a counter for visitors to see. Eric researched it more and realized cleaning is a really dirty business. What if Eric could create something more ‘green’ friendly? For example, you pollute when you clean and you use poison to make your home healthier. How can his friend and he change this? Eric took high design and deep sustainability and tried to put it into a single product offering. There first ad was just that: An attempt to get the mainstream into the green product. He did this with naked people cleaning. The reason they were naked is he wanted to show that with ‘Method Soap’, no white gloves or digging into your closet to find your 1975 old college sweatshirt that you don’t wear anymore is needed. Thus, you can even do it completely naked. Obviously, people will pay a premium for something scarce. Eric went on to say that nothing is more scarce than fun when it comes to cleaning. So, Eric would go from store-to-store begging them to let him do in-store demos to show how this soap was different than others. He broke it into little steps and built capital along the way. Eric emphasized how he had to make changes to packaging and continue to move forward, instead of backward. Target was the first store to take it in and it spread very fast. Eric mentioned the importance of culture with his team and the importance of having courage for entrepreneurs. He said he had some lucky breaks, but it has propelled the business forward. When starting a business, everything starts with culture. By having a good culture, it allows you to scale. Every Monday, they have a meeting and discuss a leadership topic. It is very similar to what we do with Guiding Philosophy. Eric ended by talking about the importance of hiring the right people. Eric always ends an interview with an odd question that doesn’t have a specific answer. The reason he does this is to get an idea of how a certain candidate thinks. Even though they are getting bigger every year, he wants them to continue to have a small feel. By doing this, you ensure the culture will stay intact.
I enjoyed listening to Les McKeown, author of ‘Predictable Success’. Les has started 42 startups and he advises senior leaders of organizations on how to achieve scalable, sustainable growth and speaks to Fortune 500 companies about his breakthrough strategies. Les emphasized that any company that is at the Inc. 5000 has already beaten the Darwinian odds. 66% of businesses fail in 3 years and 80% of all new ventures fail at the beginning. The start of every successful business is a vision. Most entrepreneurs are risk-takers, committed, charismatic, good communicators, and driven people. The reason people start businesses is the need for autonomy. Les joked that entrepreneurs want to stop working 40 hours for someone else, so they can work 80 hours for themselves. Les talked about 7 stages any new business of two or more people will go through. Four of the stages are periods of difficulty, while three stages are more smooth running. Every organization goes through an ‘early struggle.’ (stage 1). The struggle is for a profitable, sustainable market. It is a race against time. During this stage, you are just trying to stay afloat. After the ‘early struggle’, it is the FUN stage (#2). It is high growth. It is typically a relief to a CEO and Senior Management when they realize they will be able to meet payroll every month, and can pay a certain supplier on a Tuesday, and all is well. However, the small business starts growing very fast. They will take on anything and say ‘yes’ to any request. They will make sure everything is in on time (even if last minute) because it is important to SELL, SELL, SELL. With that being said, they may have triple digit growth, but they soon become overwhelmed because there are no systems and processes in place. They can’t continue to improvise each day. They soon start making errors. This stage is Whitewater (#3). It is all about delivering simplistic quality in the face of complexity. If you can get it under control with the systems and processes, the next stage is Predictable Success (#4). If the company starts going through the motions and are too fixated with efficiency (and the way things are being done), we are at the Treadmill (#5) stage. Form has become more important than function. A checklist is only completed to get it done instead of understanding the purpose. A company can recognize that the systems and processes aren’t in places and changes need to be made. You can recover in Treadmill. However, if you do not recover, ‘the big rut’ (#6) can occur. Thus, you’ve lost the power to self-diagnose. It is only a matter of time before the business hits ‘death rattle’ (#7). It will not go any further down and the company will die. I wish Les was given more time since it felt rushed, but I thought he provided plenty of good information. The takeaway was the importance to scale and the goal is to focus on a profitable, sustainable market. You need both profitability and sustainability to be successful. It makes sense why both of those words are components of being a great company.
In the evening, they had a dinner at the Knibbe Ranch where people networked. It was a fun event. Most of these firms were unfamiliar with the offshore business and seemed intrigued by the idea. One CEO/Founder said her concern with offshore firms is the communication aspect. I recommended that she speak with the team and directly experience our recruiters excellent communications skills. I also explained that our people in our International Recruiting Center are very well trained and understand how to work with American business owners.
On Thursday, the seminars became more specific. I enjoyed a forum debate about whether businesses strive at the beginning for purely profit or more of a social mission (and then accomplish profit later-on) when creating a company. One side spoke about how profits and purpose go hand-in-hand and who you are is how consumers will see you. The other side spoke about how it is value proposition and when you put social good above profits, you risk not having a company at all. One side brought up Milton Friedman’s quote in 1962, “There is one and only one social responsibility of business – to use its resources and engage in activities designed to increase its profits as long as it stays within the rules of the game, which is to say, engages in open and free competition, without deception or fraud.” The opposing side said, “it is not 1962 anymore. Times have changed.” They brought up Chester Barnard’s quote, “Thus the endurance of organization depends upon the quality of leadership; and that quality derives from the breadth of the morality upon which it rests.” The point is that profit and purpose go hand-in-hand. My personal opinion is the answer is somewhere in the middle. Purpose drives profits, but companies need a profit in order to exist.
Other than the Gala and picking up the trophy, the highlight was listening to Tony Robbins. I knew he would be motivational, but he made a lot of good points that I want to bring back to the office. Since everybody at this conference had already been somewhat successful creating a company, he talked about uncovering your threshold of control. Do you want to be a $30-million-dollar company or can you take it to the next level? Be that person that adds more value in your industry than anyone else. He went more specific – love is not enough, energy is. Passion is. Passion requires energy. Tony talked about how ‘hunger’ is the most important ingredient to an extraordinary life. IBM is a perfect example. In the US in 1997, 98.3% of all computers were Microsoft. Since that time (19 years), where did Microsoft go and what made a lot of people interested in Apple instead? Well, Apple innovated and anticipated what consumers want. Tony brought up a different example. Tony said that it isn’t the rooms at the Ritz Carlton or the Four Seasons that is so much nicer than other hotels, it is that winners anticipate and losers react. Those winning hotel anticipate your needs and go the extra step. The two master skills of life he emphasized throughout his talk were the ‘Science of Achievement’ and the ‘Art of Fulfillment.’ Success without fulfillment is the ultimate failure. Tony brought up Robin Williams as someone that had everything in life – everyone liked him and he made a ton of money. However, even though he made a lot of money, he ended up committing suicide because he didn’t like himself. He brought pleasure to millions, but inside he was hurting. You need both the achievement and the fulfillment to be successful. Tony is invested in 31 companies and 12 of them he manages weekly. Tony has over 1,300 employees and due to the amount of people, Tony said that most likely someone is doing something incorrectly right this second. However, he said how life is fragile and you can’t just be upset all the time. It is not good for the soul. Some people feel Tony is phony and they don’t really like him. I can see where they get that idea. However, I also see that he looks at life in a very positive way and if we are high fiving and motivating one another daily, it turns into a better quality environment.