Below is the transcript of my talk – “Where Will We All Be in 2019,” delivered at Growthink’s 10-Year Anniversary Celebration on Thursday, October 22nd at the Sheraton Gateway Hotel in Los Angeles.
You can view the video of my talk, along with Growthink co-Founder David Lavinsky’s remarks, via following this link:
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I look forward to your feedback, to connecting and to another 10 great years!
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"Dave, thank you very much for your review of lessons learned these past 10 years and thanks to everyone for attending tonight and sharing this milestone accomplishment with us. Particularly want to thank Rocio Melgar and Melissa Welch for all of their hard work and energy in putting this event together.
Before I dive into my “Where Will be in 2019 predictions, I would like to share a couple of stories with you. First one about a very, very famous and successful entrepreneur and angel investor and secondly, the story of how I got involved with Growthink.
As many of you know, Jeff Bezos was one of the early investors in Google. Yes, that Jeff Bezos. Founder of Amazon.com. #33 on last year’s Forbes’ 400 with a net worth of over $8.7 billion.
Here is the backdrop:
In 1998 when Google’s offices were a Menlo Park, California garage - Bezos invested $250,000 of personal funds into the fledgling search engine.
When Google went public in 2004, that $250,000 investment translated into 3.3 million shares of Google stock. And a stock share position worth over $280 million!
While he does not disclose how many of those shares he still holds, at the current price of Google stock they would represent an investment position of over $1.5 billion.
So why did Bezos invest in Google? In his words, “…There was no business plan…They had a vision. It was a customer-focused point of view.” And he adds, “I just fell in love with Larry and Sergey.”
So, now my story. Before business school and before Growthink I owned an ice cream business on Cape Cod in Massachusetts. It was a very nice life. I worked 4-5 months out of the year, lived in a beautiful place (Cape Cod), and did work that was heck a lot of fun. At age 30, I was all set. I had a business, a car, a house, and a girlfriend.
But then, in the summer of 1999, my MBA classmate Dave Lavinsky called me with this idea for a company at the height of the Internet boom. If I just worked with him for a few short months, we would be able to aggregate positions in a bunch of rocket ship gazelle companies – soon to be know as “the next Googles.”
Seemed like a great deal, So, I sold the business, the car, the house, broke up with the girlfriend, packed my bags and headed, Jed Clampett-style – not to Beverly Hills, but to Venice to start Growthink with Dave.
And here I am, 10 years later. With an amazing wife and 2 beautiful children!
And timeless truths remain:
First of All, Think Long Term. Even though Google has been the fastest growth company in the history of capitalism, it was still SIX YEARS from Bezo’s original investment in the company to liquidity. Overnight entrepreneurial successes simply do not exist. While certainly all of us would have liked to have had a Google in our lives by now, as Saint Augustine once said, Patience is the companion of wisdom.
Secondly, Get in Early. Sure, it would have been great to get into Google in 2004 at its IPO price of $85/share, as the shares are up over 500% since then. But Bezos, after adjusting for stock splits, got in at EIGHT CENTS PER SHARE!
The beauty and the allure of entrepreneurship is the opportunity to be a part of something VERY, VERY big very, very early. This is how great fortunes are made.
Third, Invest in People. At the time of Bezo’s investment, there were a large number of very well-funded and successful search engines already on the market. Remember this was 1998 not 1994. Yahoo, Alta Vista, Lycos, Excite, Infoseek to name just a few.
But Bezos was attracted to Page and Brin as people, as technologists, as leaders.
Lesson – we overcomplicate business. Great, talented leaders drive and build businesses. Everything else is secondary.
Fourth, Take Your Shot. For every Jeff Bezos who invested in Google, there are stories of dozens that were presented with the opportunity that did not.
This of course does not mean that the probability of having a Google-like success is anything but very low, but it does mean that it is far greater than the ZERO percent likelihood of success of those that don’t swing the bat.
And Finally, Get Lucky. As hard as it is for many to accept, having fantastic, great luck is a key variable in success.
Success IS assured with thoughtful, disciplined, day-in, day-out hard work. And with hard work as the given, magical success sometimes blooms.
And in the spirit of great luck, let me make my 2019 predictions:
PROBABILITY of 100% - On October 22nd, 2019, if Jay Turo is still of this earth and of animate form, he will be 51 years old.
His 2 sons, Jay Jay and Teddy, now 3 and 2, will be entering their teenage years. Dave Lavinsky’s son Max, whose conception at that particular time and place in 1999 was the magically unpredictable act that led to the founding of Growthink, will be entering his senior year in college.
Growthinker Tristan Sigerson, who started as an intern from UCLA and whose youthful cheer and spirit lifts us daily, will be 36.
Growthinker Jeff Jones, our VP of Business Development, who loves to flaunt his youth and athleticism at us 40-somethings, will be 40 himself.
Only my mother, who traveled here from West Boylston, Massachusetts to be with us tonight, will fight this trend, as she will still be celebrating, as she has for as long as I can remember, her 39th birthday.
Let’s all take a short pause here and reflect on how old YOU will be in 10 years. Does it impart you with a sense of urgency? Of dread? Of disbelief?
PROBABILITY of 90% - The NASDAQ and Dow will be trading at, respectively, above 10,000 and above 30,000.
Why – really quite simple – even getting to those levels will mean a return of less than 5% annually from 1999 to 2019. It points to how poorly the investment markets have performed in the last 10 years. The NASDAQ in particular has performed terribly, down almost 50% from where it was 10 years ago.
In short, all of us in the worlds of technology and entrepreneurship must have a deep and abiding FAITH that in the next 10 years all of the amazing technological progress we have seen and are sure to see more of will result in investment return.
PROBABILITY of 90% - The Fear of the Rise of China Will Be a Thing of the Past – America Will Still Lead the World.
Are you as tired of me as hearing about how China will catch the United States and then surpass it? There is very, very little chance that a society with no free press, with a monolithic educational system, with a totalitarian government, will EVER lead the modern world.
Lest we forget – we live in the information age. This is the age of software. All GREAT software companies – have you noticed – are AMERICAN companies? This is not by accident. Our freedom-loving, creative society is BUILT to birth great technology and great idea companies. Sure, America has problems, but compared to the problems and limitations of every other country and society in the world, we are still by far the most likely place for the companies and ideas that will shape the 21st century to be born and to grow.
PROBABILITY of 90% - The Cloud, The Cloud, The Cloud
Following up on the above, cloud computing will transition from not just being a business model or a business sector, but will become business itself. Even today there really isn’t such a thing as a technology company and a non-technology company – it is a 20th century legacy misnomer. Everything is technology and soon all of it will be run on the ether.
And we will interact with it with via devices and implants and virtual reality machines that today we can only imagine.
PROBABILITY of 100% - Growthink will be a publicly traded company and will have a market capitalization of greater than $1 billion.*
Let me put this bravado in perspective – as a grizzled consultant, as an MBA, as a risk-taker that has been well-trained to see sell all sides of the story, I am very much aware of the challenges and the probabilities.
But as a CEO, as an entrepreneur, I know the power of faith and commitment, that positive momentum is simply force positively applied. Quite simply, by sticking to our original principles – thinking long term, getting in early with charismatic and dynamic entrepreneurs, taking a LOT of shots, and being open to magic in our lives and our professional endeavors, success is assured.
Thank you, enjoy the rest of your evening, and see you in 2019!"
*Do note that as much as all of us would like it to be this is not an investment guarantee. It is, however, a statement of great confidence in the Growthink business model, in our team, and in our growth prospects.
I just finished conducting an interview on how to be an entrepreneur.
And near the end of the interview I asked an interesting question.
I wasn't sure regarding the response I would get, but I was pleasantly surprised.
The question I asked was, "What do you think makes the difference between a good and a great entrepreneur?"
I was expecting a list of qualities that the great entrepreneurs have.
But instead, entrepreneurship expert Dr. Bruce Barringer, gave a really great answer.
He said, "A great entrepreneur makes a difference in your life."
He went on to explain that the founders of Google have changed his life as he spends so much time on Google these days. But you don't have to be the next Google to be a great entrepreneur.
The founders of the local coffee shop have also changed his life. As have the companies that created the podcasting technologies that he employs every day.
The point is that great entrepreneurs are those that create products and services that truly benefit their customers in such a way that the customers integrate them into their lives.
When I think about my life, I can concur. The entrepreneurs who started the gym I go to, the gasoline station I frequent, and the supermarket where I buy my lunch have done a great job creating products and services that meet my needs. If they didn't, I'd patronize their competitors.
So, as you start and/or grow your business, you should make all of your key decisions with this question in mind: "will this decision allow my company to better serve customers and make a bigger difference in their lives?" As Dr. Barringer pointed out, if you solve the customer need, the money will follow.
To hear Dr. Barringer's answers to all of my questions on how to be a more successful entrepreneur, listen to the full interview on Growthink University here:
The other day, a BusinessWeek reporter contacted me with a question about entrepreneurial success.
She wanted my thoughts on a new business opportunity that one of their readers was considering.
The opportunity was "to open a sports store to sell products just from the four major sports teams in my city."
I hated the concept.
I immediately wrote back to the reporter:
"Is there really a need for this store? Who else is currently selling these items (stadiums? national retailer like Champs?) If there is no directly competing store, maybe there is no market? Is it hard to purchase these items online? I would think most of these items are easily found online at decent prices.
Will you offer anything that a national chain (http://www.champssports.com/) doesn't. Even a formerly local store (http://www.cosbysports.com/ in NY) now sells all teams' stuff online. And Cosby has a lot of unique items (e.g., autographed equipment and pictures that you can't find elsewhere).
The only thing that I think could work is offering unique items that you can't find elsewhere, mainly stuff like autographed pictures/equipment and collector's items. This stuff is available on eBay, but many people still like seeing/touching used stuff over buying online. With new items, I can't see this concept working since there's too much competition.
Finally, note that with the new items, the online stores have so many items. A physical store can only have so many SKUs or the inventory cost will go through the roof.
Once again, the concept only seems to work if the store offers items not available elsewhere (which will also make it more authentic - which is GOOD)."
So, why I am telling you all this?
The point that I want you to get is that your success in business is predicated on just one thing - your ability to solve the needs of your customers better than alternative methods.
In this case, unless the store carried merchandise that others didn't, it simply didn't solve customer needs any better.
So even if this entrepreneur quit their job, raised money and worked 24 hours a day, they probably would fail.
You need to worker smarter and not harder. And working smarter means that you are always looking to better satisfy customer needs; since that is the key.
Whether you are a detergent company looking to get clothes even cleaner, or a chair manufacturer looking to make chairs even more comfortable at a lower price, you must constantly be thinking about solving your current and potential customers' needs.
Why do entrepreneurs start new businesses?
Well, for some, they simply love the thrill of starting a new business. For others, they have a great idea that they think will help people, and are eager to fulfill this unmet customer need. For some, they want to create a paying job for themselves and/or not have to answer to a boss. And for still others, they have grandiose plans to "change the world."
While the individual goals for each entrepreneur may vary, most sophisticated entrepreneurs share one common goal when starting a business - to eventually exit the business for a large sum of money.
Savvy entrepreneurs know that they can make money day-to-day running a successful business. But, they know that the real money comes when they "exit"; that is, when they take the company public, or more likely, sell the business. That is when the million-dollar windfall comes that most entrepreneurs dream about.
Having successfully bought and sold businesses in the past, I have my own views on the topic of "exit strategy planning" or how to prepare a business to maximize the likelihood of 1) selling it and 2) the price at which it eventually sells. (Note that I tend to equate "exit" with "selling a business" since this is the most likely form of a successful exit.)
But, in order to provide more expertise on this subject, I recently interviewed John Davies.
Not only is John the co-author of "Selling Your Business For Dummies," but he has significant experience buying and selling businesses as the CEO of Merrymeeting, Inc.
In fact, not only does Merrymeeting own Sunbelt, the world's largest business brokerage firm, but Merrymeeting owns and/or has a majority interest in numerous national and international service franchise businesses.
In my interview, John conveyed his five insider tips for successful exit strategy planning.
The first is to make yourself replaceable. That is, if you as the business owner are too critical to the business' success, no one will want to buy it. You need to make sure that you have trained others that can run the business successfully in your absence.
The second tip is to make sure that your business has "predictable future revenues." The predictability of revenues has to do with how many new customers you get and the number of times your customers buy from you over time.
Clearly, a business that has repeat customers is more valuable than a business that has to constantly search for new customers. If your business is the latter, you need to figure out how to extend the lifetime value of your customers.
To learn more about these two insider secrets, get three more great secrets, and to learn John's personal 3-point plan that he's used to start, grow and run numerous multi-million dollar empires, listen to the full interview on Growthink University here.
To hear a short clip of the interview, click the blue triangle in the player below:
Los Angeles, CA. October 9th, 2009. For Immediate Release. Jay Turo, CEO and co-Founder of Growthink, today announced that it honor of Columbus Day on Monday, that Growthink offices will be open for business.
"Being of proud Italian heritage, I have always admired the spirit of entrepreneurship, initiative, and good old-fashioned going for it that Christoforo showed on his great trip," Turo said. "And those of in the capital-raising business (especially as Columbus Day falls right in the middle of capital-raising season) can all learn a LOT from the strategic, angel investing round he raised from Queen Isabella to finance the trip. And he put his presentation together, I understand, without the latest versions of Powerpoint and Excel."
"In honor of his achievements and his spirit, Growthink, unlike the yesterday's news post office and the bailed out banks, is excited to be working and serving the world's entrepreneurs this Monday."
Imagine a business opportunity that had a 95% chance of success.
Would that interest you?
Now, what if I further told you that not only was there a 95% chance that you would make money year after year from this opportunity. But that you would also continually be building equity in a business that you could sell in the future and retire.
Well, I'm not here to tell you about a specific business opportunity like this. But I am here to tell you about an interview with someone I did who has experienced over 1,000 opportunities like these.
That person is Ed Pendarvis.
Around 30 years ago, Ed founded Sunbelt Business Brokers Network, LLC. He has since grown Sunbelt into the world's largest business brokerage firm with approximately 300 licensed offices. Also, Ed has personally managed the sale of more than 1,000 businesses.
Few, if any, people have this level of experience and expertise. So, I was fortunate to get Ed on the line to get answers from him on key areas to help you grow a successful business.
And one of the incredible things that Ed told me was the approximately 95% of businesses which are purchased succeed.
Now, after digging a little, the reason we concluded that this happens is because there is a serious vested interest in these business.
To begin, typically with these businesses, the buyer invests all or a substantial portion of their life's savings in buying the business. As such, they have a serious vested interest in the business' success.
And, Pendarvis goes as far as stating that he would not buy a business if the seller didn't provide seller financing. The result of seller financing? The seller doesn't get paid if the business doesn't succeed.
As a result, the seller has a vested interest in the business' success and works to train the new owner how to expertly run the business.
Which leads to the question of "who has a serious vested interested in your business?" Obviously the more and better qualified the individuals and companies which have a vested interest in your business, the better the chance of your success.
So, if you have not done so already, get qualified personnel, advisors, joint venture partners, investors, and others who can take a vested interest in your company, and your success should skyrocket.
Growthink University members can download the full audio of the interview I conducted with Ed Pendarvis here:
In the interview, Ed revealed tons of great tips and information regarding buying a business, including:
* Why the success rates of buying a business or buying a franchise are over 10 times greater than starting a business from scratch
* The key things you should look for when buying a business, and the first thing you must do
* The most qualified person in the world to teach you how to run the business you bought
* The easiest place to find ideas to grow your new business
* How to maximize the productivity of your workforce once your acquisition is complete
* The 3 places to get financing for the business you buy
* Why buying a business is so much different than buying a house
In addition to great information on buying a business, I got Ed to reveal tons of useful information for those starting a new or growing an existing business, including:
* How to build a business that makes others want to buy it at the highest price
* The common traits he has found in over 1,000 successful business owners
* The technique he used to ensure quality control as he grew Sunbelt from just one to over 300 offices
* How Ed ensures that he is as productive as possible every day
If you are looking to start, buy and/or eventually sell your business for a lot of money (which I hope applies ALL of you), this is an interview you want to check out!
Listen to the full interview here: http://www.growthinkuniversity.com/members/357.cfm
Non-members can listen to a brief clip of the interview by clicking on the blue triangle in the player below: