John explains why his role as educator and mentor is what he most cherishes; Why do entrepreneurs decide to become mentors? What are the requirements for effective mentoring? John relates the sacrifices of entrepreneurship on individuals and families; How do entrepreneurs and their significant others get aligned? How long should the entrepreneurship journey last? Is entrepreneurship for everyone? John shares the worst advice entrepreneurs get; The shame of bad ideas unidentified; How does a great idea become a great business? John suggests down economies are the time to ramp up; The phases of startup; John bemoans the ROI of higher education; Why campuses are the ideal place to experience a collision of ideas; John explains the service found for fledgling entrepreneurs at Startup Ignition; The imperative of sales and developing relevant skills; How sales and a great salesperson lifted Omniture to become a billion-dollar company. We’re talking about the meaningful mentor, John Richards, who joins Rob Cornilles as this episode’s Game Face Exec.
Watch the episode here:
John Richards | The Mean And Meaningful Mentor
Admit it, one time or another, maybe even now, you’ve wondered what it would be like to be your own boss, to start your own business. You’ve identified the need, void, and the likely solution that you think could make countless lives a little bit better. If you’re wondering whether or not to take that risky but potentially rewarding step, you have to meet John Richards. This week’s Game Face exec and a mentor whose candid guidance has saved many entrepreneurs untold pain while helping them realize unimaginable opportunities.
I’m joined by John Richards. He is a man who can be described in four distinct ways. He’s been called a great entrepreneur, educator, advisor, and investor. John, thanks for joining me on Game Face Execs. It’s a privilege to spend some time with you.
Thank you, Rob, and thanks for all you’re doing for the ecosystem.
Thank you. John, in that description of you, I mentioned four ways that people have referred to you, an entrepreneur, advisor, educator, and investor. I’m curious if you had to pick one of those and had to put one on a gravestone, which one do you think best describes John Richards?
Probably in the area of education and mentorship is the one that I’ve had the most fulfillment from.
When you talk about fulfillment, can you describe for me what that means to you?
Right before we started this podcast, I had another Zoom event. It was from the mid-2000s, a student that I mentored at Brigham Young University. He has gone on to build a sizable successful company. He and I had a great catch up talk about all that he’s doing there. It’s rewarding to see what he’s done and gone on to do. He shared some principles. I had given a little bit of mentorship in his formative years, but he discouraged me a little bit because he told me he just turned 40, so that made me feel old.
How long have you been advising him?
Probably from the mid-2000s. From the thousands of students at the university level that I’ve mentored and then even people out in the community, I’ll sometimes get emails or communications from people I haven’t heard from, from 8 or 10 years ago saying, “Do you know what’s happened to me?” They tell me their success story and they said it all started when they got this principle or that help. Other ones, I have constant communication with different things. It’s such a fulfilling, rewarding thing. As far as fulfilling, one of the most fun things I’ve ever done in life was to coach my daughter’s basketball team for seven straight years. All of those young ladies are now married and with children. That was one of the most rewarding things I’ve ever done. It was coaching a youth basketball team.
I never had daughters. I have three sons who are all grown now. One of my favorite pieces that were ever written by a sports column was Rick Reilly’s piece about coaching girls basketball. Did you ever read that one?
No, I didn’t.
I have to find that one for you and get that to you.
It was fun. I found that girls listen and follow directions. When you coach youth boys basketball, it’s a running gun the whole time.
[bctt tweet=”The worst advice is no advice.” via=”no”]
Going back to your role as an advisor, you have been a successful business person for many years. It’s a unique personality that decides to step away from building businesses and advise and mentor other people to go that same route and teach them to do that. I know you’re still involved in businesses, don’t get me wrong, but you spent a lot of time helping people do what you did. There are many that don’t have the stomach and the patience for that. What caused you to go in that direction?
It’s interesting you say that. It is a sacrifice so you’re bringing up. You step off the income and equity value generation roller coaster and merry-go-round to stop and take more time with people. It’s less lucrative certainly. Some people don’t want to do that. They say, “No, I’ve got more good earning years ahead of me so I don’t want to do that.” The willingness to do that is one of the character traits. Answering your question more directly is, I like to teach. I enjoyed the field of teaching. Teaching is valuable and important.
As a young person going into teaching, it’s not a lucrative career. It’s not something where you’ll gain financial independence quickly. It’s noble, but it’s not that way. When I had the freedom after having entrepreneur success and being able to have that financial independence, I chose to be more of a teacher and mentor, and that fulfilled that desire from my early ages. Some of the traits that you need to do well at doing that though because also some people don’t have the skills or the characteristics needed to do that.
You have to be able to be a good teacher to teach well. You have to be able to be a good mentor. Mentoring is hard. Mentoring requires time, commitment, caring, and spending time with people. Not just flash in the pan superficial mentoring, but real mentoring getting down in the trenches and helping them. Some people believe that mentoring is only about teaching them how to discover their own mistakes and foibles. There’s some truth to that, that helping people learn how to discover things on their own is important, but mentoring is also sometimes being able to tell a person that their idea sucks. It’s a train wreck waiting to happen.
Like a child, if they’re going to put their hand on the burner, you don’t let them put their hand on it so they learn that burners can hurt you. You stop them from burning their hands. That’s the same thing in mentoring. There are times where you have to say, “You’re doing a red light activity and you need to be stopped now for your own good.” Other times where you let them discover on their own. That kind of being the mentor is important. You have to have a desire and a willingness to sacrifice being the entrepreneur going forward and making your own money or high income. All those traits come to play. We talked about that a lot in my circle of mentors and people that have given time the same way I have. It’s hard to find somebody who has been there, done that, and has all the experience and skills, likes to teach, and likes to mentor. For instance, you enjoy that. I’ve seen that in you. You like to teach and mentor, but not everybody does.
The thing that I’m most impressed about what you do, and I’ve observed this in you, John, over the years that we’ve known each other, is that it’s such a time-consuming activity to mentor. It’s almost like you’re a doctor, a physician who’s always on call. When these young or old entrepreneurs are working late at night in their garage or kitchen table and they’re troubled by something, if you’re the first person they think of, you’ve got to be available on the other end of that line. There are tremendous sacrifices that come in what you do, and you’ve talked about some of those. One that I’m interested in knowing more about is I know that you have, as best you can, a balanced life. You have a great family. You have a supportive wife and you support her. Can you talk a little bit about the career choices you’ve made and how family factors into that? In your case, how a spouse or relationship has factored into your decision-making?
That was a big part of taking that directional change in my life. I was married in 1983. My wife is incredible. She and I went on to have four children every two years. We have a busy household and I worked constantly. After I finished my collegiate career, I started building up a company in Seattle. Over about a dozen years, I became a leader in that industry. I worked 80-hour weeks and I was gone a lot. I parlayed that experience into the yellow pages company.
Can you explain to some of our readers what yellow pages are?
The printed Google Search. The industry was huge at the time. In 1984, the federal government broke up AT&T, the largest publisher of yellow pages and the old Bell Company with Alexander Graham Bell. It broke it into eight different companies and that led to a lot of opportunities for entrepreneurs. That’s perfect timing for me coming out of school in 1985. The yellow pages industry was rife with opportunity so I went into that industry. I parlayed that print publishing industry experience into being the first-ever online yellow pages. That happened in 1995. That caught the dot-com emergence perfectly.
My fledgling online yellow page company was sold to a new company started by some Microsoft people that had learned about me, and I became number four at that company called InfoSpace. Two or three years later, it went public in ‘98. From that entire period of around 14 to 15 years, I never took a vacation. I worked incessantly, and then we had enough financial independence to never have to work again. My wife sat me down and said, “It’s payback time.” That was an interesting moment. We decided that we would do that. It was fascinating.
Six months into that of me being the dad on all the field trips and meeting my sons after school, BYU, my alma mater university called me up and said they’d like me to be a professor of entrepreneurship. I said, “I don’t have a PhD.” They said, “You don’t need one. You can be a professional faculty member.” I tested it for a semester flying down from Seattle and I enjoyed it. I moved my whole family down to Utah and decided to work a few years like nobody else is willing to do so that you can live the rest of your life like nobody else or like many people can’t do.
I got off the moneymaking train of income. I stayed at the same level where it was at then. My kids were 16, 14, 12, and 10 when I made that change, and it’s been wonderful. All my adult children live within fifteen minutes of me. I have seven grandchildren. We get together frequently, love each other, and have great relationships. It’s paid off. I got to coach my daughter’s basketball team for seven straight years. I took control of my schedule and time, and my wife has enjoyed it. That’s a big moment.
Earlier when I was working those eight-hour work weeks though, she also taught me things. For instance, she said, “John, you have to be home from 6:00 to 8:00 PM every day.” In the first few years, I was violating that. I learned that if I was home from 6:00 to 8:00, I could have dinner, help get the kids down for bed, and then go back to work until 1:00 or whatever in the morning. I learned a lot of things from my wife. One thing we learned also is that the spouses tend to have a built-in marriage manual. If you listen to them, it helps. That’s been our relationship. I hope that answers your question.
It does. I love what you said about, “I’m willing to work like no one else will so I can have a lifestyle that few people have.” You may have had that mentality. You could have been born with it. You had that work ethic and drive. I find a lot of young entrepreneurs have a difficult time finding someone. If they’re dating or want to get married, finding someone who has that same attitude and same outlook about that. I’m wondering, were you and your wife aligned from day one on this venture and path that you’re going on?
I’m going to bring up. We talked about that. Let me clarify before I answer that specifically. One of my mentors one time told me, “Work a few years like no one else is willing to do so that you can live the rest of your life like no one else can.” What that means is that the craziness of doing it being an entrepreneur is meant to be a finite time period. If it was to go on until you’re 65 years old or older and work like that, that’s workaholism. That’s not good for relationships and family. If you say, “For these seven years, we’re going to work like that. We have a plan and a strategy behind it. We’re going to have to make sacrifice faces. We’ll be a little bit like a car with an over or under-inflated wheel sometimes and won’t be perfect in some other areas of life.”
I might not be able to be a coach. I never was able to coach my two sons’ sports. Even with my two daughters who are younger. We made that sacrifice as a family. My wife knew the sacrifices, and we did that. We had a time where that was over and we said, “Now we’re going to enjoy the fruits of what we have the freedom to do.” That’s how we structured that. That is important to understand that if it was meant to be for life, that would be a real problem. That’s not how it’s meant to be. That’s our vision. It’s interesting, my wife comes from a family of school teachers and bankers. A lot of them are conservative by nature in terms of that. They work an 8:00 to 5:00 job for a big company.
It ends up though my wife is completely along for the ride. There have been about three defining moments in my career where I put everything on the line. The first time I did it, I went to my wife and said, “Susan, if this doesn’t work out, we’re going back to a one-bedroom apartment, particleboard bookshelves, and a 9-inch black and white TV.” She goes, “Fine. Go ahead. Take your chance. I love you as much then as I do now, and I love you as much afterward. It will be fun building it back up again. Don’t worry about it.” I go, “Wow.” That gave me the freedom to take chances and risks that others might not take. We all know risk and reward go hand in hand as long as you know you’re not a crazy wild gambler and you’re a measured risk-taker.
You’re one of the lucky ones, John. You and Susan have a partnership that’s well-matched and you’re aligned. I feel for a lot of entrepreneurs who don’t have that.
Can I tell you a story about one?
Yeah, it would be interesting.
I won’t name names. One time, I mentored a great entrepreneur. He’s a born and trained entrepreneur. He had to be an entrepreneur to be happy in life. One time, I invested a significant amount of money and helped him raise $716,000 for this company. It was a great idea. The company was doing well. One time, his wife invited my wife and I out. I was chairman of the board after leaving the investment around. We went to a restaurant, The Melting Pot, which now I don’t go to because of this experience. We go to the restaurant and he goes to the restroom. His wife lays into me about his salary and says, “We can’t survive on the salary that you investors have been capped at. We have three children and I need more money.”
I told her, “We, investors, put in $716,000 and we have it capped at $84,000 for a reason. He was making $78,000 and he brought himself up at $84,000 where it’s capped, but it’s not just me. There are other investors. That’s in the documents of the investment. The company is still early and needs the capital going back into building the company. I’m not sure we can do that and pull it off.” He was gone a long time. It took 5 to 7 minutes of her talking to me like this. My wife was blown away by it. He comes back from the restroom. He doesn’t say anything. She doesn’t say anything. We finished the dinner.
A month later, he calls me back and says, “My wife is making me quit.” He’s the founder and CEO. “She says I need to be making $120,000 to $130,000. The last month talking to everybody, that’s not going to be happening here.” She makes him take a job at one of the most conservative institutions in our area and sit in a cubicle. The funny thing is I did help him get a job at a great tech company and he became their number one sales guy but she said he had to have a job with benefits and all these things. We went on to that company, by the way, to make all the investors 5x. It was a great company. He lost out. He sold out all of his shares which was a huge chunk for a small amount of money when he left. He called me up three years after all of this and told me they got divorced. He said, “John, I have to be an entrepreneur.” That’s the extreme on the other side, isn’t it? To this day, he is happier after that situation. He has got multiple companies and multiple things he’s been successful with. It’s interesting.
At the same time, you would agree that entrepreneurship is not for everybody. One has to make a decision. What’s more important for me now, and then in the long-term? Is it to pursue this dream I have and to bring this product to market or to have a happy marriage?
It’s a partnership of the spouse. A lot of times, I mentor people and say, “You need to talk to your spouse about this right now.” Have a real talk if you’re all in and try to prevent that situation I told that story on. There are people, men and women, I meet that I’m one of them. I cannot work for the man. I cannot work in a large organization. I am not happy if I am just a cog in a massive machine. I need to be an entrepreneur in control of my destiny more and have the feeling of building and growing every day. I like the days when I walk in and I’m not sure exactly what’s going to happen. I’ve got to be an entrepreneur and handle what happens. I like that. It’s a different lifestyle. I could see if I have saddled the same way this fellow I told the story about and found out. That could have easily happened to me because most of us, while we’re cording our spouses, aren’t telling them, “Are you in for this ride?”
It’s not one of the questions we typically review. “Tell me about your parents. Where did you go to school? Do you mind if I am an entrepreneur?” Let me ask you about the advice on entrepreneurship. Is there bad advice that you’ve heard entrepreneurs get over the years whether it’s from well-intentioned relatives or from professors, or someone else?
[bctt tweet=”Down economies are a great time to set the table so that you can enjoy the feast when the economy comes back.” via=”no”]
Or even investors.
What are some examples of some bad advice in your mind that entrepreneurs sometimes get?
The worst advice of all, and it’s rampant, is no advice at all. Let me tell you what I mean. It starts at the idea stage. There are two aspects to this. Let’s take The Mom Test first of all. If you’ve heard of that book, it’s a legendary book to read about making sure you don’t get caught in this. I had a young man meet me and come to my office. He says, “I’ve got the greatest idea.” He tells me his idea. “I have spent time evaluating thousands upon thousands of ideas so I’m good at it. I have my procedures and I do it mentally fast. I can teach people how to do it in a spreadsheet and all that. That’s part of my training.”
He told me his idea and I went, “That is probably the single worst idea I’ve heard in my entire years of mentoring.” He went wide in his face and he went, “What do you mean?” I go, “Hold on. Let me tell you. Here are five reasons why this is such a bad idea.” I told him and he goes, “I can’t believe it. Everybody around me tells me what a great idea it is.” I go, “Who are those people?” He goes, “My mother and my best friend.” I go, “They’re not. First of all, they may not have the qualifications to assess this idea. Your mother telling you is not unbiased feedback.”
We decided he was going to go out and get good feedback for the next three days from people he doesn’t know. He comes back three days later and goes, “You were right. My idea sucks, doesn’t it?” I go, “Yes.” He says, “I need to hang around you more.” I go, “It’s funny you say that. I need a TA for this new class I’m starting. Would you like to be my TA?” He becomes my TA and he meets my son. They cofounded Devmountain together and sold it three years later for $20 million. That’s one thing. Bad advice like that is all over the place just at the idea stage.
The problem with investors is that I’m known a little bit for being blunt, and it’s with kindness I hope. What happens is I’ll set up meetings of entrepreneurs meeting with investors and entrepreneurs come back and go, “I had a great meeting. I know they’re going to invest with us. In 30 days, I’m going to get money from them. They loved it.” I set up the meeting sometimes to make sure they get some good critical feedback. I called the investor and I went, “This entrepreneur is jazz. They had a meeting with you and think you’re going to invest with them in 30 days. Did you love it?” They go, “No, I hated it.” I go, “What?” They go, “It’s a terrible idea.” I go, “That’s not how the entrepreneur left for the lunch meeting. They thought you loved it and that you’re going to invest.”
Here’s the common refrain and get back. “John, I’m not in the job of discouraging entrepreneurs.” I say back to them, “Are you in the job of misleading an entrepreneur down the primrose path, and then squandering their time and money on an idea you know is terrible? I agree with you it’s a bad idea. I’ve told them that. They were going to you to get some more advice and feedback.” Investors and people that are mentoring have to tell people when they can back it up with the reasoning that their ideas are terrible.
You have to realize most business ideas are terrible. Few of them make good business opportunities and few good business opportunities get to the finish line. There’s a book called The New Business Road Test by John Mullins, which is the definitive work on this topic. In the foreword to his book, he wrote the book because he says 90% of all the failure could be eliminated by people just not starting companies based on bad ideas that we could have tested as an idea before we even thought about a company. We dismissed it based sometimes even on secondary research, not even primary research.
That’s fascinating because it’s absolutely right that you want to be encouraging to someone, especially if you see that they’ve got good instincts. Here’s one of the problems I’ve had, John. Tell me what you think about this. I’ve always had a problem. Forgive me if I’m stepping on your toes because I don’t know how you feel about this. When people say to young entrepreneurs especially, “Follow your passion.” The reason why I have a problem with that is that sometimes what you’re passionate about is not necessarily a good business idea.
That’s in the same genre. “My passion is knitting sweaters.”
My passion is playing basketball, but that’s not going to make me taller. I’m still going to be 5’6”.
That leads to the same thing. You’ve got to measure it and measure the business idea. In every million business ideas, only 1% or 10,000 of them are going to be a business opportunity. Inside those 10,000 business opportunities, there are going to be some poor ones, mediocre ones, some good ones, and some great ones. The only ones worthy of us taking our time, the most precious commodity we have, and our treasure, personal savings, resources, working on them and maybe even quitting a job to pursue it is a great business opportunity. You need a system.
In my Startup Ignition Bootcamp, I have a system for teaching people how to filter those ideas down so that you’re only working on great business opportunities. You then have to run through the lean startup process to make sure that you can form a business model that extracts, creates, captures, and delivers value. That’s a strong refining process. People that spend a lot of time on ideation and on idea evaluation know when they hear an idea, they can quickly put it into, “This has a possibility that’s not so good and that sucks.” That’s important.
The people that I’ve delivered that blunt news to and done it in a kind way have come back years later or a little bit later. They’ve thanked me for being honest and frank with them. They start seeing how we have an ecosystem in the venture world that sometimes does not give this kind of critical feedback. I put it just like the kid putting a hand on a hot stove, or you see two trains and they’re on a collision course. Aren’t you going to be the one that goes in switches the tracks so they don’t hit each other or you’re going to be the one that grabs the hand away from the burner?
That’s what you have to do to first time entrepreneurs or people that haven’t had as much experience. I certainly wish people would have done that to me in a lot of the decisions I’ve made early in my career. We can’t be there for everything. They’re going to make enough mistakes and enough terrible outcomes even with all the mentoring they get. Left to their own devices to discover all their mistakes by going through them is not what a mentor is there for. It’s not just to let them have a train wreck. That’s not what you’re there for.
In this economy that we find ourselves in, and I say this economy, I don’t think the economy is going to be much different than what we see today. We’re in the middle of a COVID crisis. Is this the time for entrepreneurs to contract and pull themselves into Corporate America? Is this a time for entrepreneurs to exercise those tendencies they feel that they’ve got running through their veins?
I can’t cite a bunch of sources on this but anecdotally, in my readings over the few decades, most of the research shows that this is an excellent time to start something. Be in the validation and building phase, keeping it lean and mean. When the economy, as it always does, cycles back up, then you thrive. It’s the same thing with a company that is doing well, and then this thing hit, those that make sure they stay lean but keep their marketing up, keep their brand presence up, and all that. They make sure by the time during this correction and down and when the economy is more down, they then thrive when they come back.
The ones that cut too deeply can get hurt and the ones that don’t cut enough can get hurt because their burn rate doesn’t go down. That’s existing companies. Starting a company, taking 3 to 6 months to truly validate your business model and position in it, and then starting to build the product and the infrastructure keeping a lean, taking 6, 9, 12 months to do the things you should do anyway. The things that in a good time, you might prematurely scale and rush it too much. This is a great time to set the table so that you can enjoy the feast when the economy comes back. Does that make sense?
Absolutely. What you say is though everyone needs to make a paycheck. You’ve got to eat and pay your rent. This is a time to be methodic. The market is not asking anyone to rush unless you’re developing a vaccine. The market is allowing you to be thoughtful in the thought as you talked about validation, using this time to validate. That’s interesting advice.
I’m a big believer in lean startups. The lean startup doctrine is true. I’ve proved it and I’ve had the experience for many years. I’ve seen it work. I’ve also participated and read massive longitudinal studies. Lean startup works. Lean startup doctrine is there’s a validation phase, build phase, and growth phase to businesses. The validation phase is when you are contacting your target customers and users to find out what is the magic business model that they will accept and work with you on. That can be done while you’re employed and earning a paycheck and while you’re not putting full time into it.
It will take you longer to validate as opposed to being full time of validation. This is a great time to take your time and validate thoroughly. When the economy starts coming back and it’s easier to raise money and capital to fund your runway, or to get customers, then you can be devising those systems for sales, onboarding activation, and customer service, and then going into a strong growth phase. This is antithetical. It’s like Warren Buffett. When others are selling, you’re buying. What others are buying, you’re selling. This is the same thing. A lot of people would be in trenches, “I’ve got to get a job. Entrepreneurship doesn’t work.” This is a great time to launch something and validate it.
Let me switch topics on you here, John. You were at one time named one of the Top 25 Entrepreneurship Professors in the country. Interestingly, for those of those reading this who don’t know you, you left the world of formal education. In fact, one time, as I understand it, you called it broken. We’re seeing that formal education is reinventing itself by force, simply because people are afraid to go back on campus. Online learning is now a necessity, not just a nicety of education. Talk to us a little bit about your views of formal education. How do you see it further evolving? What does it have to do to be relevant and helpful to the people that you mentor?
There have been massive studies on this. There is a crisis in higher education that has gone back for many years. There’s easy money with loans and grants to students that have paid inflated tuitions that go up 7% a year and fund high salaries for professors and PhDs in academics. That’s all been finding good for that. The disconnect started emerging where the purpose of a college education for most parents and students is to get a job and earn income, but that’s number seven on the professor’s list. Number one on the professor’s list is to help them think better. Number one on the parent’s and the student’s list is to get a great job. There’s a disconnect there.
It turns out that universities in America have an important purpose but they were more about teaching how to think like the professors think as opposed to imbuing the skills for the workplace that companies and employers need. There are only about 10 or 12 majors that have a positive ROI where you spend money on education and put that degree to work and get a job, and you have a positive ROI. There are not many of them. A lot of research shows that. There are some broken systems in all of that. That’s why a lot of the bootcamps, adult education, and online education have emerged where you can go and get quick skills training and get the skills needed by the workplace. Also, what companies and CEOs are wanting in their workers. This is important.
Universities though will never go away and should never go away because it’s important that a young person leaves their home and goes and congregates with other peers and gets training that will help them become productive adults. The thing that happens magically in universities is you bring people together that are smart and have ideas, and they start having collisions. What that means is their hunches of how things should be or what could be better in society and all that, collide with other hunches and form strong ideas. The value of a university is not degreed education as much as it is the collisions that happen at a university.
That’s why Harvard, for instance, is valuable. It’s not the degree from Harvard, but the collisions with other Harvard students and professors. Those collisions that happen of people and ideas coming together to create more than the sum of the parts. That’s why universities are important, but universities do need to focus more on imbuing skills. It’s not just to become a vocational place, but the skills. For instance, computer science is broken. Computer science at a university does not teach a person how to become a 10x software engineer that can help a company build products.
[bctt tweet=”Real business happens in sales.” via=”no”]
They’re teaching people esoteric, nebulous ways so that they can become a great PhD in algorithmic computer science, which has its place and is important. For instance, at our local university where you and I have helped out, on any given day, there are 1,000 computer science students. Ten percent of them just want to be an entrepreneur and start their own software company. They’re getting no training on how to start that company right. They are being taught nebulous, esoteric algorithmic things that would help a large company trying to do a complex data problem for a specialized thing. They are not for being able to be the coder, the software engineer that can go into a startup company or an emerging company and produce some real product.
That’s why there are many coding bootcamps that emerged over the last decade or so. It’s because, in twelve weeks, they can produce those kinds of coders, at least in a junior developer way. That’s true in a lot of different things. I know I’ve spoken a lot in answer to this question, but it’s an important one. I even took the entrepreneurial education that I was doing at the university and put it into a bootcamp off-campus for this specific reason. I was having students in their senior year come to me and they finally got into my 400-level class that changed their lives. They go, “You’ve changed my life. I’ve spent the last three years here becoming an accounting major and I hate accounting but I’m now on track. I’ve accepted a job at an accounting firm and I hate it, but you showed me a whole new world that there’s this other world that I can be my own entrepreneur, my own boss. I can control my destiny. That’s a viable option in today’s world. I didn’t know that. Why don’t they give this in the freshmen and sophomore years and expose them to this more?”
I started a class to do that and snuck it in at that university. We started changing things here. What happens if you think about university is these great 400-level classes that start giving some skills, you have to matriculate to the university. You have to get good enough grades in general education courses that far afield from what you want to do in order to get into, for instance, a business school. You have to go through another academic filter and few get all the way to a 400-level class to get my training. I said, “Let’s take it off-campus and make it available.”
I was having even the students going, “I had to spend three years just to get to you and now I’m going to do something that my first three years gave me no value for. Also, I had a 32-year-old and I know that I told him about what you trained me in this 400-level class. He wants it but he can’t get into the university and he’s not going to do that.” What’s interesting is when I do this off-campus, I’m helping people from around the world. They fly into Utah or they come from other states and they sit in the same type of training I was doing at the university, but now they’re getting it and it’s helping them. That’s a long answer, but there you go.
It’s worthy of a long answer, so thank you for that. Of course, what you’re referring to is Startup Ignition, which has been successful in helping entrepreneurs, those who’ve been disenchanted with formal education, or they can’t afford it. They can’t afford the time or they just want to make a career move or career switch. You’ve provided a great outlet for that. We’ll make sure that people know more about that. I have one more question for you. Before we go to that last question, John, for those who are interested in what you’re describing as far as Startup Ignition and how they can get your counsel and mentorship, where would they go to explore that possibility?
StartupIgnition.com and my email address is JRichards@StartupIgnition.com. I love answering questions from entrepreneurs. I will give advice and all that. I’m happy to do that. Thank you for asking.
My last question, and you know this is my baby, is the topic of sales. You’ve mentioned it a couple of times, even when we were talking about you and your wife and how you got aligned early on in your marriage. I’m sure those conversations required a lot of persuasion. When another entrepreneur wants to talk to a spouse or parents about getting some seed money, or friends and family to help invest, there are always sales going on from the moment you get the idea. If you could share with those who are reading, how has sales shaped your career? Could you have done what you did throughout your career, what you do now, without developing the skill of selling?
At the most fundamental level, sales is vital and important. I was a sales leader. I came out of my university experience technical and that served me well for a year or two, and then I realized the real place business happens is in sales. I switched to being a sales leader more than a technical leader, which was interesting. One time, I had 40 to 60 sales representatives under me leading a sales effort. They learned all about compensation commission plans, sales motivation, and how sales works, and handling objectives. I led that for a number of years. Even as I became a CEO and during the CEO role, I learned that the CEO’s number one function they should always stay close to is sales. Absolutely 100% sales in everything.
Also, with all the people I’ve mentored over the years, it’s not until they figured out sales that things took off. I tell entrepreneurs, “On the Richter scale of difficulty, finding your tech cofounder is a 3 or 4 because that stymies a lot of people.” It’s the number one problem I usually hear about. I say, “Wait until you have to find your all-star VP of sales or the person who’s going to make sales go in your company. That’s going to be an 8 or 9 or 10 on the Richter scale. You’re going to be at a point where you don’t want to pay that salary or those commissions and you’re going to be too cheap and frugal, and you’re going to hurt your company.”
I have a lot of people I mentor where they go, “John, sales aren’t happening.” I go, “You’re hiring a guy that is happy with a $35,000 base salary and a pittance of commissions. That’s the kind of salesperson you’re hiring. I’m telling you that person that told you they want a $90,000 or $110,000 basis and they’ll make another $100,000 commissions, that’s exactly who you need to hire and you need to make that happen.” I’ll go back and tell you one of my greatest Angel investments of all time is Omniture, which became Adobe Analytics and brought thousands of employees to our local Utah area. I was an early investor in Omniture. I don’t know if you know that or not.
Omniture struggled in this realm for a number of years. Josh James and John Pestana, the Founders of Omniture, finally came to me and told me one day that they cracked and figured it out. They were going through waves of salespeople. They were not getting high-powered enough the right type of salespeople for enterprise software sales. They had little money left in the bank. They found somebody who wanted to make a $125,000 base and earn another $125,000 commissions. They were used to paying $40,000 to $50,000 base salaries.
They bit the bullet and hired that person. In the first month, that guy brings in $800,000 in revenue. They go, “Is this what we’ve been doing wrong?” They hired three more people and 1 of those 3 in the next three months landed a $5 million a year, three-year contract, a $15 million sale. The rest is history. They went on to sell the company for $2 billion. The inflection point that was most important, even though they’re all important to come together, was that salesperson coming in and being able to make sales go.
John, I have to ask you though if you have a great product, won’t it sell itself?
The streets of hell are paved with good intentions. It’s just said that way. Great products don’t always just sell themselves. There are some consumer products that do that way a little bit. We know that. If you’re involved in any kind of personal selling, direct sales, or enterprise type of sales, it’s not that way.
John, this has been great. Thank you for sharing with us a collection of your experiences and your wisdom. There’s more we could dive into from everything that you’ve shared. If people want to learn more, you’ve given us your email address, JRichards@StartupIgnition.com. They can learn more about you. I’m sure they’ll want to connect with you on LinkedIn as well. I know you’re active on that. Thank you. You’ve been a great example and mentor to many people. I hope that continues. I hope you’ll do it until they put you in the coffin, John, because you’ve got a lot to give.
Thank you, Rob. It’s been an honor. Also, thanks for doing this and giving back to the ecosystem and for all you’ve done to also mentor and help us mentees and students. You’ve been involved as well. Kudos to you too.
Thank you. Thanks for being a part of this episode of Game Face Execs. If you found any of it useful or helpful, please rate or like and subscribe to our YouTube channel. I always appreciate you referring this to others as well. I’ll see you next episode. Until then, persuade, influence, inspire.
- John Richards
- The Mom Test
- The New Business Road Test
- LinkedIn – John Richards
- YouTube channel – Game Face Execs Podcast
About John Richards
Entrepreneur | Investor | Mentor | Professor | Executive
Entrepreneur: Co-founder of several ventures leading to high-multiple exits.
Investor: Active angel investor having directly invested in scores of new and mature ventures as well as hundreds more through investment funds.
Mentor: Give much time to mentor startup entrepreneurs, having mentored thousands.
Professor: Teach entrepreneurship (lean startup) at leading universities.
Executive: C-level executive with substantial early-stage experience. High premium on Internet, software, and lean startup. Focus has been on advertising and business services. Technically adept. Programmed business solutions before turning full-time attention to management.
Specialties: Accelerators, Advertising, Budgeting, Business policy and strategy, Business-to-business marketing, Cash management, Consulting, Corporate Strategy, Customer service, Database, Database: concepts, eBusiness, Electronic commerce, Entrepreneurial finance, Entrepreneurship, Family-owned business, Internet – B2B & B2C, Lean Startup, Management: consulting, Personal selling and sales management, Social entrepreneurship, Strategic alliances, Technology: impact on people at work.