2008 INC 5000 Conference Review

7:37 pm | Charles Wu | Be the first to comment

NOTE: formatting in this blog entry thing still sucks, so advance apologies if portions get hard to read

After having a great experience at the INC500 conference in Chicago last year, I was excited again for the annual gathering of the INC5000 in Washington, DC.  Last year, due to the fact that it was in Chicago, I don’t believe that I got the “full experience” due to the fact that the “lure” of the office kept me away from many of the after-hours / social events.  This time, several states away, I wouldn’t have the excuse of “work” to keep me from attending events and networking with other entrepreneurs.

Pre-Conference Day 1: Golf Tournament

I am not much of a golf player.  However, the opportunity to network with 3 other INC5000 CEOs outweighed my distaste (and lack of ability) for gold.  So, on ~4 hours of sleep (due to a luggage handling issue, I get into my hotel room until about 2 AM EST), I was up bright and early to play golf.

There were a total of 4 people in my golf group.  Andy Chiranjeevi, President of KBTS Technologies, an IT consulting company, had just begun golfing 2 weeks ago, so he and I were in the same boat.  Rory Wilfong, Co-Founder of ProspectMX, an online Internet Marketing company for Real-Estate professionals, and another fellow (who’s name I can’t remember), were both experienced golfers, so our team would be depending on the two of them to shoot a decent game.

There’s not much to say about golf, other than the fact that the conditions weren’t very good due to golf-course construction and weather, but the point of the event was to golf, but rather to network and meet other fellow Entrepreneurs.

Rory, my cart-mate, was a real-estate broker whom, in the bubble of the past few years, had worked with a few partners to create a marketing web engine to develop real-estate leads.  What ultimately happened was that they had more leads than they could handle, so they started sharing / selling them to other real-estate agents, and a business was born.  Today, they have boot-strapped a $5 million business with ~50 employees.  As someone who’s also built a business from the ground-up with no outside investment, I can emphasize and relate.  Personally, I have more respect for people like Rory who have started from nothing and gotten to $5 million than someone who’s raised $50 million in Venture Capital to start a business.

After golf, I had to decide whether or not to head immediately back (to the conference for Michael Gerber’s afternoon session) or to stay to network with other INC5000 golfers and lunch.  I chose the latter, and I wasn’t disappointed.  At lunch, I met a father-son team who ran a business performing warranty work and fulfillment for camera manufacturers and retailers.  He (who I’m going to call baldy because I never got his card and I only remember the fact that he had a shaved head – that said, it’s also worth noting that he’s probably old enough to be my father), was an extremely friend, interesting and fun guy.  Before getting into this business, he had taken a run at becoming a rock-and-roll artist.  He, like me, had also been to Chicago and was at the conference to network with fellow INC5000 entrepreneurs.  He told me that he had actually found his current IT vendor at the last INC conference in Chicago.  When he introduced Suresh Thankavel, the President of Wisdom, we found out that we had also met at the previous INC conference in Chicago…small world.  Hrm, that also got the entrepreneur in me thinking about whether I should keep my eyes open to find business opportunities =)

On the way back to the hotel, I sat across from an older gentleman fellow from West Virginia who had a company that built and repaired transformers for utility distribution companies.   There’s not much to say from that conversation, other than the fact that I’m glad that I don’t live in West Virginia.

 Michael Gerber – The Dreaming Room

I was able to catch the last hour of Michael Gerber’s session, and I’m happy that I chose to golf instead.  Personally, I thought I was a fan of Gerber, as I have read the E-Myth and E-Myth Revisited books and subscribe to the mantra of “work on the business, not in your business.”  That said, I just thought he was “way out there” for the session, talking about some “zone” or “dream” that went way over my head.   He was literally ranting on stage like some crazy preacher (flashback to an image of an early 1800s Calvinist minister ranting about how everyone is predestined to go to Hell).  Or better yet, the speech reminded me of late-night conversations back in college when we would sit in a circle in a cloud of reefer jabbering about meaningless nonsense while trying to stretch our minds and imagination (and telling ourselves that this was the pinnacle of liberal arts education, analysis and thinking). 

Keep in mind, I did not inhale.

General Session

Due to a conference call (yeah, can’t completely escape work), I was about 45 minutes late to the general session and missed Rod Beckstrom’s presentation about decentralization. 

Growing Benefits Fuel Growing Companies: While I understand that the Principle Financial Group is a large sponsor of INC magazine and probably contributed significant dollars to the conference to help make things happen, I felt strongly that most of their presentations about the necessity of benefits were redundant and quite annoying.  I find their pitches to be akin to the people who try to pitch me ROI on office furniture…

Welcome to the Idea Factory: Google – This session really didn’t do much for me

Breakthrough Performance: Even though I had already read Keith McFarland’s book, I found his presentation interesting and extremely relevant to my business.  Our business is at a point where we’ve been holding off on growth the past 2 years in order to (1) generate cash and strengthen our balance sheet (2) build the organizational structure and (3) change our culture from one of “individuals” to one of a corporate identity, as we prepare to go from being a $20 million organization to $100 million over the next 3 years.  His talk on “break-through” was especially relevant and I immediately circled his follow-up break-through session to attend the next day.  More on this in my write-up about his break-out session: The Three Levers of Leadership.

On the way down to the Welcome Reception, I met a fellow called Isaac Davenport, Ph.D (I highlight the Ph.D because my mother still looks down on me because I never got any advanced degrees) who runs a product development company in Denver.  We had a fun introductory conversation (the usual, where are you from, how are you, how is your company, etc) which really wasn’t any different than probably the other 100+ introductory conversations I’d have over the weekend.  The one thing worth noting here is that, unbeknownst to me at the time, Isaac would turn out to be a party animal over the course of the weekend.

Welcome Reception & Marketplace:  At the welcome reception, I had an opportunity to meet and speak with Jim Melloan, the project manager for the INC 5000 project.  We had a very interesting discussion about the INC 500 / INC 5000 and the rankings in general.  Obviously, I gave him my 2 cents and plenty of criticism in how one could argue that the rankings are unfair, not good, etc, but in all in all, when I look back at it, INC has done a pretty good job given their limited resources at highlighting the “premier” private companies in the United States.  My one comment to INC (as I know this write-up will probably make it back to INC in some manner) is that you need to raise the bar for minimum 1st year revenue from $200k to $2 million and last year revenue from $2 million to $5 million…my personal opinion, it’s not until a business hits 30+ employees / $5 million in revenue that it actually becomes a business (prior to that, it’s basically a sole proprietorship).

I didn’t really take the time this year to look at the exhibits this time, which much to my chagrin, would end in me missing out on an afterhours Career Builder party later that evening.

Afterhours

Still wired on 4 hours of sleep from the night before, I ended up going up to my room and going to bed.

Day 2: Friday September 19, 2008Breakfast

As a young entrepreneur, one would think that I wouldn’t have a bias towards other young people…however, as weird as it sounds, I always seem to make assumptions that young people are just “there for the ride” – even taking into account the fact that I’m just another “young guy.”

Last year, it was Jared Isaacman from United Bank Card.  This year, it was Kevin Sproles from Volusion.  While we were eating breakfast with two ladies who were telling us about their business, a Dental Office Corporate play, two people sat down and joined our table.  One was an older fellow from Louisiana who ran a home-care nursing /staffing company.  The other was Kevin Sproles…however, because they sat down together, and due to the fact that the older fellow did most of the talking (even though they were completely unrelated), I naturally assumed that they were together (perhaps Kevin was the older guy’s protégé / intern, kinda like how I had Jeff Ehman with me).  After breakfast, as we are walking out, Kevin introduces himself to me and we do the usual meet and greet.  Seemed like a smart guy.  It isn’t until another person who I met later in the conference started talking about Kevin did I put two and two together…go figure.

Speaking at breakfast was Bill George, a Harvard Business School professor who was the former CEO of Medtronics.  Unfortunately, due to echoing and noise issues, I really couldn’t hear what he was saying well, so missed what seemed to have been a pretty good talk.

General Session: Building Great Companies with Jim Collins

Jim Collins, author of Good to Great, gave the morning Keynote for the conference.  Having read Good to Great multiple times over the years, it was still amazing to hear the actual author talk.  The scary thing though, was in listening to his talk, everything that he had said was a “no no” were things that my company had done / was doing…eek.

Well, they say that the first step towards recovery is admitting that there’s a problem…

Here are my notes from his talk.

KEY POINT: If you allow growth to outpace your stable of key people, you will surely fail

 “WHO” comes before the “WHAT”

Businesses need to focus on the WHO

THE BRUTAL FACTS:

1.       Need the Discipline to confront the brutal facts of business

2.       Disciplined action BEGINS with what we decide to STOP DOING

WHEN PUTTING TOGETHER A “STOP DOING” list

1.       Need a debit / credit ratio of To Dos vs. Stop Doings

How to access “Good-to-Great”

1.       Figure out how many key seats are on the bus

2.       Figure out what percent of these key seats are filled

3.       Figure out a plan to fill these seats

Characteristics of the “Right People” on the Bus

1.       Fit with the core values of the company coming in the door

2.       Do not need to be managed

3.       Understand that they don’t have a job – they have responsibilities

4.       Do what they say they will

5.       Take personal responsibility for their actions / mistakes

6.       Passionate

Over-Reaching

1.       If you can’t keep a percentage of good people, you WILL over-reach

2.       If it goes wrong, you can’t recover

3.       Set a performance standard that you need to hit on a consistent manner

Reminders: ToDo after the Show

1.       Go to Jim Collin’s Web site (www.jimcollins.com) and download diagnostic tool

2.       Start tracking number of key seats and whether or not they’re filled

3.       Aggressively seek out generation Y

4.       Build a Personal Board of Directors

a.       Council <- Build council and use it Socratically

b.      Try to double your questions to statements ratio

5.       Take time to think -> Whitespace days

6.       Start a Stop-Doing List

7.       Figure out “core-values” of the organization

8.       Set a 15-25 year BHAG

9.       Prepare the company to be “great” without oneself

Ultimately, GREATNESS is the intersection of DISCIPLINE & CONSCIOUS CHOICE

Wow, that session made the entire conference worth-while – hope I take what I learned and actually remember to go back to the office and focus on what I have to do and to NOT do.

General Session: Inside the Entrepreneurial Mind

Last year, American Express gave everyone in the conference a free Apple iPhone.  While I knew it was highly unlikely, I couldn’t help but hope that we might all get an encore to last year and get another round of free iPhones…it didn’t happen.

The panel of Seth Godin and Tom Peters, moderated by Susan Sobbott, president of American Express OPEN, was, in my opinion, much more interesting than the “spiel” Susan gave last year introducing the Plum Card.  Seeing the banter between Susan, Seth and Tom was highly entertaining and engaging.  Unfortunately, all I can remember from that session was that it was fun and a good time, but I don’t think I got anything from that.

Lunch Break: IncBizNet Leadership Meet Up

For lunch, there was an IncBizNet Leadership Meet Up where the topic was Hiring and Keeping Top Talent.  In these situations, it’s the selection of your seat (which is completely random) and the people you sit with will make or break the lunch.  In this case, I wasn’t very lucky, as on one side of me was an INC Reporter and on the other side was someone who worked for The CEO Project, one of those Executive forum groups that acts as a defacto Board of Directors for hire.  Now, both people were extremely nice, and we had conversations, but there’s a marked difference between talking to people who are “in the trenches” vs. talking to people “on the outside looking in.”

On a brighter note, sitting in the next table was Joy Gendusa and Sarah Payson from Postcard Mania.  They were a postcard design and mailing company that I had used when I first started my business in 2001, and I was happy to introduce myself to them as a happy customer of theirs.  Although we really don’t have business overlap, both Joy and Sarah are awesome and fun, and I’m glad to say I met them (and in a conference dominated by middle aged males, it’s always more fun to talk to cute women and say that it’s business =).  Come to think of it, they’re female, they’re cute and they own a $20 million computer…hrm…

Jokes aside, it’s fun to put a face to a company name.

The Three Levers of Leadership: Building Breakthrough Capabilities: Keith McFarland

Here are my notes from this session…obviously, you can tell that I was “rapt” with attention here.

3 LEVERS OF LEADERSHIP

1.       Strategy: a collection of ideas of how we’re going to win – management’s job is to make sure one collects ideas faster than the competition

2.       People:

3.       Execution

NOTE: Companies need to constantly reinvent themselves every 3-5 years

4 STAGES OF AN ORGANIZATION

1.       One-man Band (startup & crisis)

2.       Tribal Clan

3.       Village Eldership

4.       Sovereign Organization

STRATEGY GIVES YOU THE ROUTINES YOU NEED TO SUCCEED

3 IDEAS ON STRATEGY

1.       Most companies think of strategies TOO SELDOM – need to talk about it more (at least once a quarter) – Questions to ask

a.       What are the three most important strategic accomplishments done in the last 90 days

                                                               i.      NOTE: a strategic accomplishment is some element in how we’ve changed the field of play

b.      What are the three most important ways we fell short of our strategic potential?

c.       What are the three most important things we’ve learned about our strategy

2.       Most companies look at strategy TOO EXCLUSIVELY – need to involve more people in the strategic process

a.       The more minds you have working on the problem, the better chance of success as long as the process is correct.

3.       Most companies looks at strategy from a TOO CEO-CENTRIC perspective – need “Insultants” to make things happen

PEOPLE

PROBLEM
SOLUTION

“Great People” Myth (Good to Great)

No “Right” Person

Heroes vs. Bricklayers

People are “made right” by the organization

Lack of Systematic Thinking

Executive Development Milestones

Regarding direct reports

-          Write about the skills/attitudes/etc that the person will need when sales have doubled/tripled

 

NOTE: Loyalty to a PERSON is a LIABILITY in a breakthrough company (to breakthrough, one has to be loyal to the ideals and needs of the collective organization)

Be a DETERMINED developer of people

EXECUTION

PROBLEM
SOLUTION

Loose link between strategy and execution

Quarterly action plans

90 day resets

NOTE:

-          Execution is squeezing the 20% of the stuff that gives 80% of the results

No “after-action” discipline

1.       What went right

2.       What went wrong

3.       What will we learn from this

 Marketplace Break: 45 Minutes of Networking

I had the pleasure of meeting Ryan Buchanan during this break (well, it’s hard to say if it’s a pleasure, but since Ryan devoted a paragraph of his blog to me, I felt obligated to at least reciprocate something back).

In all honesty, Ryan’s a fun guy and someone who I’d definitely want to keep in touch with.

Breakout Session II: The Knack…and How to Get It: Norm Brodsky

What can I say, Norm Brodsky always puts on a good and entertaining session...given that I have no managerial, functional, technical or business skills, if I didn’t have “the knack”, then I would be truly worthless and probably wouldn’t be in the conference…so even though I didn’t get much out of it, it was an extremely enjoyable session…and I ended up buying Norm’s book.

Ditching Class (or the General Session)

What can I say, this Ryan guy and I have started hitting it off, and after Norm’s session (of which we both attended) we spent the next 30 minutes outside just talking about business, growth, companies, etc…all the usually schoolyard chit-chat topics that occur between two entrepreneurs on the playground.

That said, we ended up going to the General Session, listening to another horrendously boring Principle Financial Group spiel (seriously…their “case-study spokesperson” sounded like he had just had the speech beaten into him for an hour beforehand).  Then, it was politics, and while I admire the Carl Schramm, the Kaufman Foundation, and everything it stands for, I “cut class” with Ryan.

Dinner at the Smithsonian

Free food, drinks, lots of people, fun, dancing…how can anyone complain?

Well, if I was one to accept the status quo, I would probably be some faceless cog working in a massive corporate machine, but instead, here I am…

Personally, while the party was nice, I’m a big fan of energy (maybe it’s because I’m young) – and a big believer that parties need to packed with energy….the museum was too large, people got spread out, and I am not a big fan of art…I much preferred the packed environment of the House of Blues last year, where people got down, dirty and sweaty…personally, I think it makes for a better party.

Day 3: Saturday September 19, 2008

Slept through breakfast – probably shouldn’t have done it…oh well

General Session: AE Hotchner

A.E. Hotchner and the mission of his business is something to be admired.  Even though I still fall into the category of greedy capitalist pig at this stage of my life, I can still admire people who are better than me.

Marilyn Carlson Nelson, an extremely impressive woman, had a tough act to follow.  While I admire her accomplishments with her business and admit that she is probably 10x more capable then me as a business person, somehow, her topic just reminded me of my Grandfather whining / lecturing to me about something that I can’t remember anymore…

After Marilyn, there was an interview with Elon Musk…you can tell that he’s an incredibly smart person, but for some reason, I walked away not too impressed with him and basically just felt like he got extremely lucky…maybe I’m just jealous.

Breakout Session III: Hope, Fear and Mojo: Where Do We Go From Here?

Even though Doug Tatum’s concept of “No Man’s Land” was probably the most relevant issue that my business currently faces and learning about this is top three on my “to-do” list (see, I’m listening to Jim Collins =), he (Bo and Doug) spent most of the time trying to convince everyone to become a “Small Giants.”  I can see where this might be useful for someone who was relatively unsure of what they were doing with their business, but for me, I should’ve attended a different session and just bought the book (which I incidentally did after the session and read it the next day) and attended a different session.   Then again, if I didn’t attend the session, I may not have bought and read the book

Here a brief summary of what Tatum’s book “No Man’s Land” covers:

No Man’s Land explores the reality of business growth by focusing on a pivotal stage in a business’s life cycle, the adolescent stage in which a rapidly growing firm is too big to be small, but too small to be big.  During this phase – growth confronts entrepreneurs with new challenges for which they are not readily equipped.  No Man’s Land is about comprehending the realities of this unique transition that businesses will face so that the entrepreneur can make solid, informed decision about how, and in some cases whether, to grow the business.

If you’re at the stage in business where this may affect you, I would highly recommend that you purchase a copy of this book.

That said, I can’t say everything was lost, because after the session, I ran into husband and wife team Genevieve Thiers Dan Ratner from Sittercity.   Now, I’ve heard of Genevieve (even though she’s never heard of me), and what’s interesting is that we both have musical backgrounds…well, Genevieve still sings Opera and I haven’t touched a piano in almost 10 years, but it is worth noting that we both shared a common understanding of the classical music industry (in a previous life, I had contemplated attending Juilliard for piano).    We had so much fun talking and learning about each other’s business that we missed the first part of the General Session.

General Session: Optimism is the New Cynicism

Um, that presentation was a bit too granola for me

Lunch and Marketplace Break

Have you ever sat down in a table where you make an introduction and start a conversation between people sitting on both sides of you, but soon it becomes apparent that they are EXTREMELY interested in talking to each other but NOT AT ALL interested in talking to you (and probably in the back of their mind, hoping that you would just disappear)?

After lunch, I was wandering the exhibit hall and had a chance to meet Dave Dreiling from GTM Sportswear (they had an exhibit booth).  As the owner of a 600 person company, Dave has plenty of people manning the booth for him, but he took the time to sit and chat with me (or maybe I just kept talking and he was just being polite).  Anyways, it was a fun conversation and that’s someone whom I’d like to keep up with in the future.

Champagne Reception – Black-Tie Dinner and Awards Ceremony

I had gone for a work-out right before the Champagne Reception, so when a group of girls started staring and pointing at me, I was feeling pretty good about myself…that was until my wife mentioned that they were pointed to the large spider that was crawling up my back…

About the Awards Ceremony…I think this suffered from the same issue as the previous night’s museum party.  Everything was too spread out (as compared to last year when the ballroom was completely packed) and I didn’t like the energy…in fact, I got so depressed (and bored) during dinner that I convinced Isaac Davenport to go up front with me where we would streak.  However, right before I was going to take my shirt off, Norm Brodsky came on stage and started the awards ceremony.  So, the question of whether I have the guts to streak at the INC 5000 will have to wait until next year.

After Party

No B52s…<cry>  My wife, who doesn’t like to dance, excused herself and told me to grab my 2 year-old daughter.  My daughter loves to party, so we went back downstairs and danced the night away…We had a blast…and so concluded the INC5000 conference.

How I started the business

1:46 pm | Charles Wu | Be the first to comment

DISCLAIMER: Editing stuff in the minature text box that this blog interface offers is extremely cumbersome, so I'm going to attach a pdf with pictures and all the good stuff (recommend that you look at that for a better reading experience)

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My grandpa used to laugh when his 5 year old grandson told him that he was going to own a McDonald’s when he grow up so he could get chicken nuggets for free.

I got my first job in high school cleaning toilets at a local heath club.

Looking for something better, I bought a book about computers and tripled my salary by getting a part-time job programming at a local Internet startup.

19 years old and a second year at the University of Chicago, I was recognized by USA Today as a member of its collegiate all-academic team.  I took graduate level economics coursework while maintaining a 3.8 GPA at one of the most nationally renowned institutions in the country.  I traded derivatives and pre-IPO stocks in my spare time and had grown my summer job savings from high school into a $25,000 investment portfolio.  I played classical piano across the country and all around the world.   I ran track at the varsity level.  I started a non-profit to bring literacy to disadvantaged inner-city children.  I joined a fraternity.

I was looking for something exciting to do.

I tried the “work thing” again that summer at one of the largest and most prestigious financial services institution in New York.

We had entered the program with the carrot of a $5,000 signing bonus and a projected six-figure compensation package if we were willing to work hard all summer.

After one particularly hellish week, we were let out early on Saturday at 10:00 PM and decided to go to one of the “hottest” nightclubs in NYC; there, I met the bathroom attendant.

 His “job” consisted of the following

1.       Smoke a lot of reefer

2.       Hand out a variety of toiletries (soap, gum, cologne, moist towels) to drunk nightclub patrons

3.       Collect tips (averaging $2-5 / nightclub patron)

4.       Sell illegal drugs to supplement  tip income

This nightclub was three stories tall, had foot traffic exceeding 3,000 people throughout the night, and had a single bathroom.

I figured I had to find a way to “work smarter.”

At the end of the summer, I was the only intern in the program not offered a full-time position.

Multi-player computer games had created a demand for network connectivity to facilitate collaborative play.  Our fraternity house was located approximately 1 mile away from campus.  There were a total of 12 of us in the fraternity, but only 6 of us lived in the house while the rest lived in the dorms.  We had to find a way to connect to the University network so the other 6 could join us in playing StarCraft and Quake.

The Telecommunications Act of 1996 had created a new breed of competitive telecommunications carriers like Winstar and Teligent who were pioneering the concept of using microwave technology to bring Internet and telephone service to underserved office buildings in the downtown metro.

A leased T1 connection in 1999 cost over $1,000 / month.  A microwave radio capable of delivering a T1 had a one-time cost of $15,000.

Wireless Networking technology, based upon the 802.11 standard (the precursor to WiFi), had become commercialized and was being used amongst the early adopters.  This technology was capable of delivering up to 2 Mbps of bandwidth using microwave technology in the 2.4 GHz bands at distances of up to 200 feet.

At the time, a Wireless Networking card cost $300.

With some basic reasoning and an understanding of the fundamentals behind electromagnetic spectrum and communications gained from reading reference materials, it made sense to assume that a wireless laptop card capable of delivering signal 200 feet could be modified to utilize external amplifiers and antennas to increase the signal and boost the distance to 5 miles.  All I needed was a hammer, some tools, wire and a soldering iron:

 

After making a basic prototype inside of the fraternity house, I decided to go to the rooftop to test my “contraption.”  Our frat house consisted of the basement and first floor of a 6-unit apartment building.  Looking for roof access, I climbed the balcony to the third-floor, but couldn’t figure out the location of the roof hatch.

 

Finding a solution to scale the side of a three-story apartment building was easy.  During a rebellious period in my first year in college, I had learned how to climb and repel off of many tall buildings structures throughout campus. 

Ironically, after building out anchors up the side of the building, I discovered a roof hatch on the other side of the building.

 

 

I learned about the concept of “line-of-sight” the hard way while standing on top of the frat house.  Line-of-sight in the world of microwave communications requires that both endpoints “see” each other in order to establish a reliable broadband connection.  Obviously, the 3 story frat-house didn’t satisfy this condition.

Surrounding the frat house were a variety of tall buildings that would provide clearance.  I just needed to figure out a way to get an antenna on the top of one of those buildings…

I started knocking on doors and it turned out that the property manager of the tallest building in the area was willing to talk.

 

 

It turned out that broadband access technology in the area hadn’t been heavily developed and service providers in the area were incapable of providing high speed access in the building.  We made a deal where I would gain rooftop access in exchange for wiring up the building and providing competitive broadband access to residents within building.

Now I just had to make everythingt work.

 

 

 

I got the system built-out and working and was able to establish connectivity between the fraternity house and campus.  I didn’t get very much time to enjoy the gaming experience because I had underestimated demand.  With a good percentage of the building signed on as customers, I became busy installing and supporting several thousands of dollars / month in Broadband Access revenues. 

 

 

 

 

I was in the cover story in the August 2000 issue of Red Herring Magazine.  I learned about “PR Spin” when editorial guidelines wanting an article about young entrepreneurship and mentoring caused me to “adjust” my story to fit the context of the article.

 

 

Caught up in the euphoria of the dot-com boom, it was my understanding that the next step was to develop a business plan to raise venture funding and start a company.

 

 

At the time, my older brother was attending graduate school at the Business School which had an annual business plan competition for its students.  I wrote up a business plan for my startup, put together a team and entered the business plan competition using his name.

I was the first undergraduate in the history of the GSB New Venture Challenge to be accepted into the semi-finals of the business plan competition.  During the three month process of developing a business plan, the team put together a proposal to raise $5 million in venture financing.  I also had my first taste of bad management when my team broke up due to my immaturity.  Not surprisingly, we didn’t make the finals of the New Venture Challenge.

 

 

EVERYONE out there said that a cocky 20 year old kid without even a college degree who “knew it all” had no chance in succeeding.

2. Which areas of the business plan were weak?

Needless to say Charlie you need to get your B.A. – some gray hair would be helpful.

20 years old, I had enough credits from my 1st 2 years of college to graduate a year early in the summer of 2001.  With ~$5,000 / month in revenue and $10,000 left in my checking account, I decided to prove EVERYONE wrong.

 

 

INC 500 Conference Review

12:06 am | Charles Wu | 3 comments

I am 27 years old and own a company that hit $15 million in revenue for 2007.  Starting from my fraternity house, I have financed growth these past 6 years through internal operations with our only debt consisting of company car loans and a line of credit against open receivables to ensure that checks don’t bounce due to clearing delays (this will be going away soon due to a newly negotiated banking arrangement).  However, in reviewing the last 6 years, hindsight has shown that better decisions could have been made. As a subscriber and reader of INC magazine, one might wonder why I have never bothered, with 5,125% 2001-2004 and 973% 2002-2005 Growth Rates, to apply for the INC 500.  I have never applied before due to a bad experience I had with publicity back when I initially started my business.  That said, with a woefully lacking network of people / peers / advisors to discuss ideas, I decided to apply for the INC 500/5000 competition this year to attend the INC 500 conference in order to: 

1. Learn more about developing an effective People Strategy
2. Meet people (peers / potential advisors) who would provide me “context” of my current situation.

 In July, I was notified that CTI made the INC 5000 list and that I had qualified for an invite to the INC 500 Conference from September 6-8, 2007 in Chicago, IL.
Conference Day 1: Thursday, September 6, 2007 

Due to the fact that the conference was in Chicago, I missed the pre-conference golf-tournament and company tours due to the proximity of the office.  There is always work to get done.  I arrived at the conference at 2:30 pm in time to spend some time browsing the marketplace before the opening session began.

 Registration & Marketplace 

After picking up my badge, the first booth that I walked into was manned by a company called Greenleaf Publishing.  There are two things I remember about Greenleaf Publishing. 

 

1. The booth staff thought that the provided furniture made their layout look like the set of a porn (we probably wasted 10-15 minutes joking about this due to the fact I know a little more about the industry than I probably should from my friend who owns a hosting company that services that space).
2. Greenleaf is promoting a self-publication and distribution program for INC500 & INC5000 company leaders who want to self-publish “advice books.” Personally, having very little knowledge of business, this is a product that won’t be very useful.  However, I have a lot of customers with large egos who would love to be able to “leave their legacy.”  Something to think about…

 

The next stop in the marketplace was Vistage.  Vistage International (formerly known as TEC) claims to be the world’s largest CEO membership organization.  I spent some time talking to several of the representatives from Vistage, told them my story and my goals, and learned about the Vistage’s service offerings.  Vistage is founded on the principle of idea, knowledge and experience sharing between executive CEOs.  At a $12k / year price tag, I am unsure of whether it is a good deal.  $12k to join a social-club is a bit steep, and $12k to get high-level management and strategy consulting seems like too good of a deal. They did offer me a free 90 minute coaching session as a trial; can’t beat free.  I’ll probably take them up on that offer.

 Thursday Opening Session 

3:30 rolled around and it was time to go inside to listen to the opening session.  The first session was a panel entitled “Great Entrepreneurial Minds: Unlocking the Secrets of Small Business Growth.”  Sitting on the panel was Gigi Chang, founder of Plum Organics, a recent startup, Clint Greenleaf, founder of the Greenleaf Book Group (I had just talked to them outside in the marketplace), Joanna Meiseles, founder of Snip-Its (a kids hair cutlery, which, with the current spending habits of my wife on our daughter, I know there DEFINITELY is a market for), and Jack Stack, president and CEO of SRC Holdings (~$300 million business conglomerate).  From that session, I took away one point, which incidentally, was the answer to a question that I asked.

 

Me: Everyone talks about a people strategy, and how great our employees are, how we want to treat them with respect and get them engaged in our business.  Can you comment on how you get your people engaged in your business?

 

Jack: I use a technique called Open Book Management, where ALL the employees see the financials of the company, learn about their specific role and how it impacts the company, and then gain ownership of their personal “P&L.”  How well does this work?  Back in the late 80s, I was walking down the building when I struck up a conversation with a janitor, who happened to be in a bad mood and was languishing around.  I approached him and asked him what was bothering him.  He replied, “Approximately 90% of SRC Holdings’ business is in the engine truck (or some industry-specific manufacturing vertical) industry which seems to be headed for disaster in a few years.  We are over leveraged and extremely vulnerable…Additionally, given the way market pressures are going, our specific industry is headed for recession in a few years…if we don’t diversify, I don’t think we’ll be around for much longer…”

 

Wow!

 

On this answer alone, I (and probably many others in the room) ended up running over to the Border’s kiosk and buying a copy of Jack Stack’s book.

 

The first panel was followed up with a presentation from Gauri Nanda.  She presented a “How I Did It” session about the creation of her company, Nanda Home.  Nanda Home was started as a class project at MIT and has garnered significant media attention through viral marketing, which is extremely helpful for a consumer products company.  I personally didn’t get very much from this session due to the fact that (a) Gauri seemed to be a bit timid on stage and thus wasn’t very engaging and (b) At my current stage, the start-up process isn’t all too interesting.

 

After Gauri’s presentation, Mark Jarvis, the CMO of Dell, gave a presentation on Marketing in the Digital World.  I found his presentation extremely interesting and engaging (and if I was in the mind-set of marketing, I would venture to say that this would be one of the best presentations at the conference).  However, I needed to stay focused on my initial conference goals so I ended up forcing myself to check email on my PocketPC.  I did take some notes on some of the more interesting points made (to be filed away for future analysis).

 

1. Consumer is in Control: Being in B2B, this wasn’t anything new or revolutionary…I can see how this might apply to B2C type companies.

 

2. Focus on “Word of Mouse” Marketing: Incidentally, this made me think of WOMMA (Word Of Mouth Marketing Association)…I don’t very know much about WOMMA, other than the fact that the web site is www.womma.org and that it has a catchy name.

 

3. Create Advocacy: this really rang a bell, due to the fact that I am currently trying to apply the principles of Ken Blanchard’s “Raving Fans” within my organization…incidentally, this also reinforced to me that I need to pay less attention to Mark and focus more on people strategy, because you can’t expect your people to treat your customers right if they aren’t rightly treated.

 

4. Be Part of the Community: Makes sense, I built our business initially through viral marketing on Internet Discussion List Serves, and a major piece of our current existing corporate strategy is based upon regional 1-day educational “road shows” where we facilitate learning and networking within our market niche.

 

This ended the first day’s general session.

 Thursday Welcome Reception: 

With the conclusion of Mark Jarvis’ presentation, everyone went into the Marketplace to enjoy the Welcome Reception and to mingle with attendees and vendors (free food and SWAG).  At this point, since I really didn’t know anyone (but wanted to network), I went back to talking with vendors.

 

The next vendor that I had a substantive conversation with was the CEO Project.  I had a good feeling that the lady standing there (seeing that I was a 27 year old kid in cargo pants who really needed to shave) didn’t want to talk to me, but I politely kept on her for information and after awhile, she warmed up to me and we had a meaningful and interesting conversation (I need to thank Steven Covey’s 7 Habits for giving me the know-how for my success here).  As things turned out, I may fit the criteria of a target CEO Project customer / member (don’t judge a book by its cover, eh?).

 

As I browsed further amongst the vendors, I stumbled across the booth of United Bank Card.  As a business, we are now having an increasing number of customers paying with credit cards, and processing fees are starting to creep up (we pay on average close to $10k / month in credit card processing and taking AMEX costs us almost 4% of sales revenue) so their offering was something that was definitely worth investigating (well, not for me personally, but for my internal operations people).

 

Here’s something that I found interesting.  After waiting a few minutes, a young guy standing at the booth with a United Bank Card shirt approached me and we had a decent conversation.  I told them about the challenges that my organization was facing and he, being extremely knowledgeable, was able to give me insight about the industry and how he would be able to provide me with a solution to save me money.  This was wonderful.  Then I asked him for his card.  Turns out it was Jared Isaacman, who at the age of 24, holds the title of Founder and CEO.  For some reason (and I’m not quite sure exactly), I was shocked to see such a young person as the CEO of what appeared to be a fairly well established and professional company.  Being in a similar situation, this doesn’t make much sense, but at the time, I was really taken aback.

One thing to note, there was a company in the Marketplace that gave away what I believe was the best SWAG (a portable cell-phone charger) but hadn’t bothered to put their name and/or logo on the giveaway.  I’m definitely going to keep and use that giveaway, but I’ve already forgotten who I got it from.

 

United Bankcard Poker Tournament:

 

Free Food, Free Drinks, Free Poker, Prizes…what’s there to complain about?

 

Coincidentally, I had the opportunity of sharing a poker table with Jared and learned about how he started the company.  His accomplishments are quite impressive, (starting the company at age 16 with a $10,000 note from his grandfather, $50-60 million / year in annual revenues, flush with cash) and I was truly humbled.  I spent some time talking with other members of his organization, and everything else that I learned about him only increased my level of respect for him.  He’s someone that I DEFINITELY would like to get to know better.

 
Conference Day 2: Friday, September 7, 2007 

Friday began with a session from Scott Cook, founder of Intuit, the maker of the Quickbooks accounting system that we use to run our business (we’ve actually only use Quickbooks as our GL and have integrated it with an add-on web-based ERP application called Oasis).  His session focused on people strategy, which was EXACTLY what I had came to this conference looking to learn.

 

Point 1: Your People are Your Greatest Asset: Treat THEM as a Volunteer Workforce

 

Point 2: Give Your Employees the Ability to Experiment and Change Workplace Process

 Summary: Ultimately the work is done by people and process 

Scott was an extremely engaging speaker, and I enjoyed his speech so much that I didn’t take my customary detailed notes.  All I have to take away from this session are my impressions above (hopefully, one can find / purchase videos / conference proceedings).

 

After Scott, Donald Katz from Audible, Inc gave his “How I Did It” presentation.  Donald was a very good speaker, but being a completely bootstrapped company, I’m not particularly interested or impressed with a company that, after spending a lot of VC money on unnecessary things, was just starting to turn the corner. (I’m not saying that VCs or funding are a bad thing).  I actually spent most of this session checking and responding to office-related emails on my PocketPC.

 

After Donald, Susan from American Express went on stage to unveil the Plum Card.  The session started with customary vendor brown-nosing… you entrepreneurs are so great, smart, innovative…<YAWN> – coupled with the customary feature pitch…you’ll get this and this and this with American Express.  Even though it may have been a good presentation, American Express’ rising merchant credit card processing fees (almost 4%) has given me such a bad perspective that each of the presented benefits only makes me think that higher processing fees are just around the corner.  Apple iPhones are nice, but I’d happily exchange that for a reduction of my $60k+ annual AMEX merchant processing fees.

 

Friday Breakout Session I: Leaders on Leadership

 

Originally, I was planning on attending the Second City comedy troupe session, but Jack Stack’s answer to my question from Thursday changed my mind.

The session was moderated by Bo Burlingham and a panel consisting of Joe Mansueto from Morningstar and Jack Stack from SRC Holdings.  Bo did a good job of asking questions, and fortunately, the majority of the discussion was centered around People Strategy issues.  Here are my takeaway points from that session:

 

1. Don’t be (or call yourself) “Boss”
   
   1. The term Boss is a function of the “command and control” mentality of the industrial age, and in today’s information age, in addition to the physical engagement of our workforce, we also need their mental, emotional and spiritual engagement.

 

2. Credibility and Integrity are KEY to building a positive winning environment

 

3. Build Trust in your organization

 

• Joe Mansueto’s 4 Characteristics of Leadership
  
  • Talent Developer
  • Strategic Thinker
  • Relationship Builder
  • Change Manager

 

• Jack Stack added to Joe Mansueto’s Leadership Characteristics by highlighting “Succession Planning” and his “Pluck and Place” policy

 

I was again given the ability to ask a question.

 

Me: As a young founder of a company, I am not scared / hindered by any of the challenges that we face.  However, I have learned to some extent that I cannot seem to apply this metric to my people, as I often am faced with the “I am not you” excuse from them.  Honestly, I’m really not that bright; I’m just bull headed enough to jump in the pool without thinking.  How do you deal with this in your respective organizations?

 Answer (It’s a bit of a blur between who said what): 

1. When you’re looking at your people, you may sometimes have people who are just getting the job done but who don’t seem to have the potential for future growth.  Although every business needs the Average Joe, if they’re not an A player, you are ultimately better off making a change now rather than waiting.

 

2. Jack Stack again referred back to his “Great Game of Business” which focuses on the following points
   
   1. After your employees understand their impact on the Company Financials, have them provide forecasts of what they’re going to do
   2. Hold them ACCOUNTABLE to their forecasts
   3. Numbers need to come from the people

 

3. Ultimately, it’s the pattern (and the way people follow the pattern) which defines what makes a company great.

 

On a side note, part of my “context” goal included the initial formation of a Board of Advisors / Directors for my company to add a sounding board for me due to the fact that:

 

1. Marc, having never grown a business beyond $10 million, is breaking new ground
2. I don’t know anything

 

I approached both Joe and Jack about this possibility after the session concluded.  Joe, being an extremely nice guy, gave the impression that he was somewhat interested.  (Optimism aside, he has much better things to do than to help out some clueless 27 year old kid and probably didn’t want to sound mean).  However, he did give me his card.  I also talked to Jack, another extremely busy person, and though he declined my proposal, he mentioned that he would be willing to spend some time on the phone with me to draft a framework of what I would need (position wise) for such a Board.

 

Obviously, as things currently stand, even though I’m naïve, I am smart enough to realize that there’s little reason for either Joe and Jack to help me out as an advisor…what I need to do is to put together a compelling win-win scenario where the gain of advising me and helping my company succeed outweighs the opportunity cost of time spent.

 

Friday Lunch & General Session

 

The general session during lunch was presented by a distinguished panel of academics that everyone, in the midst of eating and networking, ignored.  I have to give credit to the presenters; they (or so it seems from my perspective) had a good sense of humor about the situation.  Had I continued my academic pursuits in college and advanced in the field of economics, I believe that I would have found the content fascinating.  Unfortunately, I, like many others, got caught up in a conversation with the person sitting right next to me, in my case, it was a person by the name of Scott Medintz, who is working on creating a new type of magazine under Mansueto Ventures specifically for the start-up entrepreneur (this new publication is being launched to fill a market gap that both INC and Fast Company currently miss).  For the next 30-45 minutes, I filled his ears with nonsensical ideas about the type of content that this new venture should cover.  Hopefully, he’s smart enough to ignore my suggestions.

  
Friday Breakout II: Customer Love: How to Develop Best in Class Customer Service 

Following lunch, I went to a session presented by Mike Faith, the president and CEO of Headsets.com.  Mike runs a B2C business that generates the vast majority of its revenue through its call center operations.  That’s a business where it’s all about customer service.  On top of being an incredibly funny and engaging speaker, Mike gave a wonderful presentation on developing a Customer-centric organization.  Here is what I got from his session.

 

1. Customer service is a company culture, not just a departmental function

 

2. Be truthful to your Customers even if it costs you the sale…ultimately, it’s the right thing to do and in the long run, it will reap benefits for you

 

3. Regularly test you and the competition’s Customer service by being an actual customer to see what you can do to improve your Customer experience

 

4. Remember the technology is a tool – don’t let technology create your process, bend technology around Customer service.

 

5. Be respectful of your Customer (value their time as much as your own, don’t leave them on hold, give them up-front accurate information, try to answer their question / issue while they’re on the line)…never allow disrespect towards a customer, even when they’re off the line

 

6. Begin every call with a “Thank You”

 

7. Solicit Customer feedback as much as possible.

 

8. LOVE your Customer

 

Later that evening, I was able to hook up with Mike and his partner at the YPO reception and spend some time with him…He’s awesome.

 
Friday General Session:  

What Got You Here Won’t Get You There

 

Generally speaking, I am a skeptic when it comes to “experts” due to the fact that very few of them actually “walk-the-walk” (Remember the Dilbert 1% Rule).  However, Dr. Goldsmith definitely knows his stuff.  His session was centered around self-improvement with a specific emphasis on people strategy and interaction.  Dr. Goldsmith does an excellent job of combining humor and audience participation to really drive home his point.

 

I arrived at the session just in time for his listening exercise; everyone in the room was supposed to pick a bad habit that they wanted to get rid of and then walk around and talk to as many people as possible in order to solicit feedback and suggestions for improvement with the only response to the feedback being a simple “Thank You.”  I personally have a bad habit of being late to things, and that’s what I picked.  In this exercise, I received the following suggestions.

 

Me: I have a habit of being late

 

Suggestion 1: Get a watch (3 people told me that)

 Me: Thank you.  

Me: I have a habit of being late

 

Suggestion 2: Set your watch 5 minutes early

 Me: Thank you.  

Me: I have a habit of being late

 

Suggestion 3: Don’t try to “squeeze in” that additional task before you need to leave

 Me: Wow…er…Thank You 

Bill Clinton: How Entrepreneurs Can Transform Communities – And Change the World

 

Former president Bill Clinton was the next speaker.  I have heard that he is an incredibly engaging speaker, but unfortunately for me, I lack the mental ability to multi-task; I was still digesting everything from Dr. Goldsmith’s presentation and didn’t take in very much from Clinton.  That’s probably my loss.

 

In looking back at this, a story popped into my head about Bill Clinton and John F Kennedy.  Back in 1963, Bill Clinton met President John Kennedy in the White House Rose Garden.  The encounter inspired Clinton to seek a life of public service.  True or not, I remember reading an urban legend about this encounter, in which Bill Clinton introduces himself to John Kennedy and lets John Kennedy know that one day his name will be as well known as John Kennedy.

 

In hindsight, I should have taken the initiative to shake Bill Clinton’s hand.

 YPO Reception 

The Young Presidents’ Organization (YPO) hosted a reception that evening for INC500/5000 honorees.  The YPO is a global network for young CEOs that support peer information and idea exchange on both a business and social level.  Specifically, YPO is a peer group for young CEOs.  I met several YPO members at the reception and had many good conversations.  There were 2 things about YPO that stood out to me

 

1. There is a wives forum for YPO members
2. Scott Cook gave a YPO endorsement at the end of his speech earlier in the day

 

In my search for context, a peer group is definitely something that would be extremely helpful.  In addition, Marc has recommended that of all “peer group” organizations out there, YPO is probably the one most worth joining.  I was extremely impressed with YPO and I plan on submitting an application to join YPO.

 House of Blues 

Parties are always fun.  However, one interesting note; it seemed that the vast majority of people on the dance floor were INC staff members and employees of other exhibiting companies.  I would think that entrepreneurs would be more willing than employees to “let loose” due to the fact that they “buck the trend” on a daily basis.  Maybe not…

 
Conference Day 3: Saturday, September 8, 2007 

Waking up and getting to the conference in time for the 8 AM session wasn’t the easiest thing after a late night at the House of Blues, but listening to Michael Kobold’s “How I did it” story about starting the Kobold Watch Company was worth that lack of sleep.  In my search for context, I am looking for peers and Michael, like Jared Isaacman, is someone I want to get to know better.  Unfortunately for me, I wasn’t able to personally catch him after his presentation.

 

Making Your Ideas Stick

 

Chip and Dan Heath gave a fascinating presentation about marketing, which, like Mark Jarvis’ presentation, I had to force myself to “filter” in order to stay focused on my conference goal.

 Sticky Idea Paradigm 

SUCCES

imple

nexpected

oncrete

redible

motional

tories

 Try as I might, their presentation was so good that I couldn’t help but walk away with ideas.  For now, I’ll just Refuse to say “Hey…” 

Bob Galvin: Extraordinary Entrepreneurial Opportunities

 

Chip and Dan Heath are an extremely tough act to follow.  Robert Galvin, former CEO and chairman of Motorola, is an older gentleman who is more determined to achieve his goals than many 20 year olds that I know.  I find this admirable.  In regards to session content, it was focused primarily on strategic entrepreneurial opportunities. 

 

After missing out on shaking Bill Clinton’s hand, I was determined to redeem myself and right after the presentation, walked up to Robert Galvin, shook his hand and introduced myself.  This may sound silly, but it is extremely difficult to muster the confidence to walk up to someone who is extremely successful, shake their hand, and inform them that you will be as successful as them in the near future.

 Making a Fool Out of Myself 

During the general session, Dell had made an announcement that copies of Chip and Dan Heath’s book, Made to Stick, where available outside.  After shaking Robert Galvin’s hand, while looking for either Chip or Dan Heath to get their autograph, I ran into a nice lady and asked her if (1) she worked for INC and (2) if she knew where Chip and Dan were signing books.  The lady’s name was Jane Berentson, editor of INC Magazine.  I think I offended her.

 Breakout Session III: Creating a Performance-Driven Culture 

This session, moderated by Ellen Brodsky, co-owner of CitiStorage, was actually led by 3 employees of the company.  In this era of gurus, it’s extremely impressive to find someone who actually practices the mantra of “work through your employees.”  I was extremely impressed by the confidence of the CitiStorage employees who had to address a room full of “bosses.”  Ellen came into the organization 13 years ago to help her husband, and has transformed Citistorage from a culture of fear and intimidation into a highly productive and fun environment.  I will be looking at CitiStorage as a model for my company’s People Strategy.

 

1. Combine Fun & the Job: Productivity and fun go hand-in-hand

 

2. Promote from Within: Brining in “Outside Bosses” kills employee morale

 

3. Employee Culture IS the Competitive Advantage

 

4. 401K Matching: I found it fascinating that CitiStorage uses 401K matching as metric for employee effectiveness.  In short, they want people who care about 401K benefits, due to the fact that employees who care to build THEIR future are employees who will work to build the company’s future.

 

5. GYM Membership: Fostering an employee gym actually creates a culture and environment for meetings / get-togethers in an informal setting

 

General Session:

 

The general session started with Shoba Purushothaman giving a “How I Did It” presentation.  Here’s what I got from that

 

-          Use customers to fund your business (e.g., charter programs)

-          It’s better to recruit inexperienced but SMART people

 

Katrina Markoff, the founder of Vosges Haut-Chocolat, gave her “How I Did It” presentation after Shoba.  The presentation was hilarious, but from a business perspective, I found Katrina extremely flaky and scatter brained…however, as a parent with a 2 year old daughter, I really admire her mother.

 

After Katrina, Tom Szaky, the founder and CEO of TerraCycle, gave his “How I Did It” presentation.  I was happy to listen to his story and afterwards, exchanged contact information with him.  I have found another peer.