People wonder why I am so fixated right now on all the regulatory legislation in healthcare, the automobile industry, the financial sector and virtually every other segment of society that touches our lives with overbearing government control. It's because with every fiber of my being I honor, promote and respect the entrepreneurial spirit that continues to help America thrive and prosper. I hope and pray it never gets stifled into extinction by excessive government intrusion, but the threat is real.
It is astounding to me how few people in this administration actually have business experience. That may be the reason the economic recovery is still so stagnant -- we're being led by academicians and attorneys who have no idea what it is to hire people and have to make a payroll and pay taxes every two weeks. They are creating an atmosphere that is dampening rather than encouraging the entrepreneurial spirit.
Jobs are NOT created by Barack Obama, government stimulus and regulatory reform bills. Jobs are created by entrepreneurs. (Click the link).
Here's the most stunning and immediate example I can think of:
Brandt Page did in early 2009. He'll be the first to give credit to Jordan, his wife, who added her paycheck to the venture to help him get out of the ground.
After graduating from BYU, Brandt announced his plans to his family. "I'm going to start my own business," he declared.
His grandmother exclaimed, "What? But Brandt, you're too young. You've just graduated from college, and now you need to find a real job!"
Most successful entrepreneurs will tell you similar stories about how they started. They are surrounded by legions of well-meaning friends and relatives who think they never should have taken that first fateful step into the unknown.
But Brandt Page is a pragmatic visionary, and he began small. He set up a card table in the front room of his townhouse condominium, hooked up an automated VOIP dialer to his computer and started calling. He found a company that was willing to pay him for cold calling other companies they were targeting for their products and services. Brandt jumped right in with both feet -- sometimes stockinged, sometimes bare -- while he began selling over the phone.
After early success, confident now that others would pay him for doing what they didn't want to do, he began attracting others to his ideas. He'll tell you he owes a lot to his Junto Partners mentors, Alan Hall and Greg Warnock, owners of Mercato Partners. He learned their lessons well. The evidence continued to roll in -- people were actually paying him for his performance and soon he needed more help. A good friend joined him, then some former roommates who believed he was on to something.
After some early rookie mistakes, budding entrepreneur Brandt was off to the races. A few months later he recognized the need for some changes. He didn't hesitate. He jetisoned his original plan, modified his offering to scheduling appointments instead of trying to sell his clients' products, then hired experienced, credible and more mature professionals. The ample supply of displaced professionals from "the worst recession since the Great Depression" (how many times did President Obama use that phrase?) was exactly the model he needed. He learned quickly and implemented changes boldly, bootstrapping his technology with the combined experience of subsequent additions to his fledgling company.
He found experienced people with years of combined sales and management experience. He's still the youngest employee of the company. He jokes that the average age of his staff is 44, and he's the only one who still drags the average down!
Brandt will tell you there were a few tight spots. Cash flow was unpredictable but bootstrapping is what he's all about, turning down offers from angel investors.
"I would much rather have the advice and counsel of my advisors than their cash," he explains.
He's had others offer to help him for a piece of the action, but he's content to make it on his own.
"Most young bucks like me think they need a business plan that's perfect, and then they go to venture capitalists looking for money for an idea they haven't proven. That never made any sense to me. I've always believed the idea has be proven and tested first." His closest advisors have confirmed his determination of going it alone.
The growth metrics continue to confirm Brandt's instincts -- his revenues and his client list continue to grow organically.
Today, Brandt Page isn't likely to hear what most young entrepreneurs hear: You're not a “proven” team with “proven” technology in a “proven” market. He's not asking to hear it, he's just routinely going about his business exceeding expectations.
Or, your company may simply not be a “VC deal” -- that is, something that will go public or be acquired for a zillion dollars. He's just not pitching anybody who says that -- yet -- but the day will come.
Instead, Page's model is a simple service business that works: "We fill up our clients' salespipes with qualified appointments. Our clients pay us directly for each appointment, and we hand off warm leads to their inside sales teams so they can do what they do best: close more sales." Simple. Scalable. Workable. Manageable.
Page subscribes to an interesting counter-intuitive idea -- that too much money too early is worse than too little for most organizations. The federal government could take a "page" out of Page's playbook for success. That's not to say he wouldn't like to stand in the sunshine of stunning financial success someday and have someone buy him out. Until that day comes, the key to his success has been "bootstrapping."
At Christmas last year, Page bought and distributed Guy Kawasaki's classic book for entrepreneurs, The Art of the Start. I don't think he even finished reading it, because he's so focused on what he's doing, but I devoured it in two nights, couldn't put it down, and observed that a lot of what Brandt's been doing is modeled after Kawasaki's advice. I recommend the book.
Here are some fundamental back-to-basics pearls of wisdom from this up and coming CEO, Brandt Page, and it's sound advice for the seasoned professionals too:
Focus on cash flow, not profitability
You pay bills with cash, so focus on cash flow. If you know you are going to bootstrap, you should start a business with a small up-front capital requirement, short sales cycles, short payment terms, and recurring revenue. It means passing up the big sale that takes twelve months to close, deliver, and collect. Cash is not only king to a bootstrapper -- it's the queen, prince and court jester.
Forecast from the bottom up
The bottom-up forecast goes like this: “We can add five new clients a month," thought Page in the early going. That adds up to sixty clients in a year. So our first year sales will be 5 new clients per month x whatever size campaign they ask us for per client per month and we'll realize something achievable by the end of the year. Rather than reaching for a small percentage of a huge market Page knows is unlikely with the top-down approach, can you guess which number Page thinks is more likely to happen?
Deliver first, then perfect later
In a service business like Launch you don't sit around inventing the perfect business plan. "Instead," says Page, "you deliver the best product you have available at the moment and you constantly improve your offering as you grow." What? Deliver first, then perfect later? Unthinkable! But that's how bootstrappers do it and it works. When your service is ”good enough,“ get it out there to your clients because cash starts to flow when you start delivering. "It's definitely a tradeoff," says Page. "You stake your reputation against your cash flow. You have to deliver on what you say you'll do, even if it isn't perfect at first." When you prove to others you can deliver, your reputation remains in tact and cash flows.
Forget the ”proven“ team
Great companies often are built with ordinary people doing extraordinary things. Winners can be trained. They can be coached to greatness. When you've got an idea that works, you will attract hungry talent. "Like the perfect product," adds Page, "proven teams -- people you've predicted will succeed because you think you know them -- are over-rated." People who worked for a billion dollar company for the past ten years are not accustomed to stretching and improving. They didn't have to. "Look for people with startup experience who aren't afraid to take out the trash, and clean the toilets at first to save expenses." The bootstrapping lifestyle isn't for the fainthearted who are in search of a 401k plan and a fat pension they're accustomed to.
Focus on function, not form
Once again, stay with the basics. Business cards with the perfect logo that brands your startup isn't nearly as significant as getting from point A to point B, and if that navigation includes a paperless trail that's more efficient, so much the better, according to Page. Page has a printer in his office, but he still has 3/4 of the first ream of paper to go in it a year later. Beyond the printer, his staff has a "can do, no excuses" attitude that breeds success and persistence. "They sweat out the details until they get it right," observed one client.
Get good stuff for free
While you're building an online brand like Page has done, look for doing the right thing for free -- that includes press releases, speaking engagements, bargain coupons for everything from food to golf he can use as "spiffs," seminars, offering free advice to others, and targeted messaging that fills up social media sites. Within a matter of months after starting Launch, Brandt Page was tapped by American Express as one of 50 people in America to follow on Twitter for sales advice. Why? Because he shares the wealth of his learning experiences with others, and it's usually sound, reasoned and practical advice that's quickly actionable and understandable. He's naturally inquisitive by nature and asks a lot of questions. Guess who learns.
Praise, train and coach your small but eager staff. Get the most out of them before making the next incremental hire. "Have you leveraged the most out of your people," Page asks, "or can you spread just a little thinner before adding more fixed overhead?" Like most successful sales entrepreneurs, Page is upbeat and positive -- he's just fun to be around. He may not be able to pay his top performers as much as he would like today, but his abundant compliments for their performance and a positive work environment that is supportive and cheerful goes a long way in the bootstraping stage.
Keep an eye on Brandt Page and Launch Sales and Marketing. He's already turning heads and being cited as an example for others to follow. Recently named as the Utah Technology Council's Emerging Executive of the Year, he continues to shine brightly as a rising star.
As the name implies, they've "launched" successfully and if they continue to "eat their own dog food" as Launch founder Brandt Page is fond of saying, they'll soon be in a predictable and self-sustaining orbit.
He's the "anti-Obama antidote" -- he and others like him across this great nation of ours will continue to lead the way to sustained economic recovery.
That much-needed leadership is clearly NOT coming these days from Washington D.C., where the best educated, presumably smartest people in the world reside. It's coming from unlikely places like South Salt Lake, Utah.